a brand marketers guide to retail media networks rmn

Customers prefer personalized ads over generic ones, prompting brands to leverage retail media networks (RMNs) for targeted marketing. RMNs allow retailers to optimize their digital presence, collect data, and enhance customer experiences. Brands benefit from direct access to consumers, better data attribution, and improved relationships with retailers. However, managing multiple RMNs can be challenging, making agency support beneficial for navigating this complex landscape.

Customers are choosing personalization over generic advertising. The deluge of information online about any product you can imagine is not only overwhelming to customers but also prone to be ignored unless there’s something about it that demands their attention. This change in customer priority and expectation creates problems for brands and retailers alike. Customers trust their favorite retailers, and brands need to tap into this trust to effectively personalize marketing. Brands are also always looking for high-quality consumer data, as well as popular outlets to market their goods. Retailers need a robust, flexible retail operation that maximally leverages digital assets like websites and data. They need to collect information, segment it, and keep it private. And they need a way to market their operations to the brands that fill their inventories. To do all this, retailers are creating their own retail media networks (RMNs). So, what does a brand marketer need to understand about retail media networks? We’ll walk you through it here.

What is a Retail Media Network?
A retail media network (also known as retailer media network and RMN) is a retailer-owned network of media products. The network includes digital shelves, content, and platforms that brands can buy media on to obtain direct access to the retailer’s customers.  You can also think of it as a general advertising strategy or model that retailers are using to generate closed-loop customer experiences and capture key data. RMNs need extensive digital infrastructure, planning, and maintenance. This is because they are endemic to the continuing shift towards more complex customer-centered marketing and business operations. RMNs are broad initiatives that can encompass disparate parts of an organization, including IT, media, advertising, marketing, and sales. For this reason, archetypical examples are those RMNs of large brands like Amazon, Walmart, and Instacart.  The evolution of the retail media network is the industry recognizing that, while in-store retail shopping still has its place, any retailer who isn’t maximizing their online presence will be missing the majority of retail shoppers.

"The evolution of the retail network is the industry recognizing that, while in-store retail shopping still has its place, any retailer who isn't maximizing their online presence will be missing the majority of retail shoppers."

Understanding Traditional Retail Marketing

To fully understand the concept of a retail media network, consider the traditional way a brand would advertise within a retail setting. This usually involves leasing premium space within a store, such as an endcap or in-store signs.  Advertising like this is effective but limited. There’s no personalization available, and essential customer data, such as who is buying what products most often, is left out of the equation. Endcaps work because they’re conveniently placed and hard to miss. The same principle applies to successful advertising on a digital platform.

Retail Media Networks Aren’t Just for Online Shopping

An RMN is an update to traditional retail marketing principles that focuses on the digital presence of the company to compete with the convenience options available to today’s customers. The end goal of an RMN is to have a fully functioning, closed-loop advertising and purchasing platform that maximizes customer personalization and minimizes friction.

"The end goal of a retail media network is to have a fully functioning, closed-loop advertising and purchasing platform that maximizes customer personalization and minimizes friction."

This doesn’t mean that in-store retail shoppers are not a focus of an RMN. 56% of shoppers still like to visit a store before making online purchases. A retail media network can and should include ways for brands to advertise in stores and any outlet the retailer controls.

FAQ About Retail Media Networks

Some of the most frequent questions brand marketers have about RMNs are:

What is a Media Network?

A media network is a network of media platforms that serve to reinforce and support one another, resulting in mutual growth. The “retail media networks” definition is flexible. In general, they share the following characteristics:

  • A network of media offerings like digital shelves, social media postings, segmented customer data, and direct marketing opportunities.
  • Directly managed by a retailer, or a company chosen by the retailer, where advertising space is sold to brands and manufacturers.
  • Uses data generated to personalize advertising and shopper experiences.
  • May appear on the retailer’s main website, but this is not a requirement.
  • Some represent many retailers, so they are not branded with any single retailer name.

How Do Media Networks Work?

Media networks function as digital real estate, sometimes spread across several sites, existing to bridge the gap between retailers, customers, and brands by creating new ways to advertise and shop online.

Why are Retail Media Networks Important?

To keep it simple, RMNs are important because they are the way of the future. In fact, the U.S. digital retail media ad spending may reach $51 billion in 2023, from $40.81 billion in 2022.

The increase in retail media network (RMN) advertising spending from 2019 to 2024

Any marketing, brand, or retail leader needs to understand the concept as well as how to leverage it or risk falling behind.

What is Amazon’s Retail Media Network Called?

Amazon calls its retail media network Amazon Advertising. Their RMN is one of the largest in the world, boasting a base of nearly 200 million U.S. customers from which brands can draw data and use it to design products and marketing.

6 Key Reasons for the Rise of Retail Media Networks

It’s a simple reality that more and more customers start their shopping journey online. Whether that’s researching new products, placing an order for in-store pickup, or taking advantage of free shipping, consumers are interacting with retailers and brands before heading in-store. Here are some of the benefits brands get from RMNs, or in other words, the key reasons why retail media networks are only going to grow.

1. Marketing Personalization

Customers today need advertising that speaks directly to them, brands that reach out to them proactively, and retailers that go out of their way to facilitate easy and enjoyable shopping. Retailer media networks solve the problems facing marketers, brands, and retailers by forming a closed loop of advertising, shopping, and checkout while generating massive amounts of valuable data.

"Retailer media networks solve the problems facing marketers, brands, and retailers by forming a closed loop of advertising, shopping, checkout, and generating massive amounts of valuable data."

You, as a marketer, can use this data to personalize any shopping experience to the benefit of everyone involved.

2. Unpredictable Retail Operations

COVID was a death knell for many small retail operations that weren’t yet leveraging online assets well enough to survive when shutdowns seized the global economy.  The companies that survived were those that were already well-established in the online retail sphere and could absorb the sudden loss of in-person shopping. Though COVID is hopefully behind us, even a far less serious event could put a hamper on your retail operations at any time.  A flexible online marketplace and network of advertising products will always be useful for surviving tough times.

3. Closed Loop Data Attribution

One of the strongest points of an RMN is its ability to generate a great deal of very valuable data.  The simple reason for this is that every step of the shopping process comes under the purview of the retailer.  Direct marketing, in-store or on-site advertising, sales, checkout, and loyalty programs are all essential pieces of a retail media network. You can leverage each step to gather data and improve customer experiences.  Ultimately, an RMN improves a brand’s ability to target its customers. All of the retailer’s rich, first-party data is available to create, segment, and market consumers.

4. Countering the Waning Effectiveness of Traditional Retail Marketing

In-store signs and endcaps still work, but the effectiveness of non-personalized advertising is waning regardless of its medium. A retail media network helps brands make up for this with its ability to personalize. As RMNs become more refined and effective, profits from them will keep rising. It’s estimated that retail media markets will grow by 25% per year to $100 billion over the next five years. At this rate, retail media will account for 25% of total digital media spending.

"Boston Consulting Group estimated that retail media markets will grow by 25% per year to $100 billion over the next five year. At this rate, retail media will account for 25% of total digital media spending."

Customers don’t just want to shop anymore. They want an experience. The more convenient and relevant this experience is to them, the less friction will exist between them and checkout.  There is evidence of this phenomenon in the massive jump that Amazon’s advertising revenue saw in the pandemic year, 2020. A jump that has not only been sustained but has grown since.

The growth of Amazon's Retail Media Network revenue.

Regardless of how you feel about retail media networks or personalized advertising, the reality is that customers will look for this experience because they know they can. The only question is whether or not your brand will capitalize on RMNs’ power and momentum.

5. Improved Brand and Supplier Relationships

The data gathered by retail media networks is valuable not only to retailers but to all the brands listed as well. Each can use this data to see which customers are buying what items and when. This isn’t just useful for advertising but also for things like product development and even the pace at which to order replacements or start to scale. Though brands may bristle at the concept of advertising using retailer platforms, they will listen to results: RMNs are more effective because they allow direct consumer access. In addition, RMNs include open exchange inventory that can be shown across the web, so advertisements may not be limited to only the retailer’s properties.

6. Improved Customer Satisfaction

A retail media network is the best way to ensure customer data and privacy is well secured since it will remain entirely under the retailer’s control.  Customers’ data won’t only be safer, but you can also put it to better use with more personalized advertisements, timely content, and far less friction through the entire shopping experience. There’s nothing like a one-stop shop!

The Challenges for Brands Navigating Multiple Retail Media Networks

While retail media networks are a net positive for brands and retailers, there are growing pains involved in the transition that many brands are currently living with. Since the initiative is undertaken on the retail side, brand leaders and marketers may feel left out of the development process. They don’t have access to infrastructure and in many ways are subject to the competency of whoever is in charge of the RMN. There’s also a natural concern that the largest RMNs may, one day, demand exclusivity. There’s also the problem of managing your marketing operations inside many retail networks, instead of just one global network.

Why You May Want an Agency to Manage Your Retail Media Networks

RMNs are a massive undertaking for retailers. Any investments or policies in place are going to be strictly guarded since they can’t afford to fail.  All of this means brands, especially smaller brands without leverage, will need to be adept at managing the diverse sets of rules and formats their advertisements must take. They also need to be able to comb through volumes of customer data, find patterns, design personalized marketing campaigns, and execute them – potentially across many different networks – each with different aesthetics, customers, and contexts. If you’re concerned that your brand isn’t going to be able to handle this load, E29 marketing can take it on for you! E29 is a dedicated marketing team that specializes in creative marketing strategies, growth-driving social media, pinpoint digital ads, shopper marketing, and expert marketing analytics.  Most of the concepts E29 makes our living on are key aspects of retail media networks, meaning we have the insight and experience necessary to wade through the dozens of RMNs you’ll want access to. Managing campaigns across dozens (or even just a few) RMNs requires dedicated time. Leveraging our expertise and buying power means hours back in your week.

Investing in Retail Media Networks Early Could Yield Big Returns

The concept of retail media is highly likely to keep growing. Retailers around the world are already taking part in retail media networks or cultivating their own. As a brand marketer, you’ll need to ask if now is the time to get involved. Brands who made the early switch have already reaped some benefits – surviving COVID, for one – and now they’ll have the chance to shape the future of retail media in partnership with major retailers. They’ll also be the brands working with retailers to shape retailer media networks that have positive benefits for all stakeholders.

If you’d like to learn more about how E29 can manage retail media networks on your behalf, get in touch with us

Next

Unlock Marketing & Advertising Excellence

Get exclusive insights, industry trends, and game-changing strategies delivered straight to your inbox.

Join industry leaders who trust our full-service expertise

Related Posts

February 8, 2018
crafting the ideal o2opus online to offline pop up shop
October 10, 2018
is market research protected from the robots