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Overview of the Summit
The 2024 Path to Purchase Retail Media Summit in Chicago brought together industry leaders to discuss the evolving landscape of retail media, with a strong focus on incrementality measurement and the optimization of Retail Media Networks (RMNs). As the retail media sector continues to thrive, with 75% of participants reporting strengthened brand-retailer relationships, the summit highlighted both the opportunities and challenges facing the industry.
Importance of Incrementality in Retail Media
A key theme throughout the event was the critical importance of incrementality in measuring the true impact of retail media investments. Speakers, including Brian Spencer from Kroger and Jess Hendrix from Hy-Vee, emphasized that traditional metrics like click-through rates (CTR) and return on ad spend (ROAS) are no longer sufficient indicators of campaign success. Multiple studies presented at the summit, spanning from 2009 to 2021, consistently showed no correlation between clicks and ROI or conversions, challenging long-held beliefs in the industry.
Introduction of Incremental Return on Ad Spend (iROAS)
The summit introduced the concept of incremental Return on Ad Spend (iROAS) as a more accurate measure of advertising effectiveness. Unlike traditional ROAS, iROAS focuses on sales directly attributable to advertising efforts, controlling for other factors. This shift in measurement approach is crucial, as 38% of attendees reported difficulty in proving investment incrementality.
Challenges in Incrementality Measurement
Incrementality measurement, however, comes with its own set of challenges. 53% of participants cited analytics and reporting limitations as a major hurdle, while 41% noted lower ROI compared to other channels. To address these issues, the summit explored various measurement approaches, including experimentation, econometrics, and direct attribution, each with its own strengths and limitations.
Advertising Strategies and Their Incremental Value
The event also shed light on the nuances of different advertising strategies. Surprisingly, conquesting campaigns were revealed to be more efficient than previously thought when viewed through the lens of incrementality. Similarly, even branded search was shown to have incremental value when used strategically to introduce new products or upsell multipacks.
Role of Retail Media Networks (RMNs)
Another significant focus was the role of Retail Media Networks in the changing landscape. With 80% of brands investing in these networks, up 66% from 2023, the summit addressed the challenges of managing multiple RMNs, including data quality concerns and the need for standardization. A KPI audit framework was proposed to help streamline goals and improve performance measurement.
Adapting to Changing Shopper Behaviors
The summit also highlighted the importance of adapting to changing shopper behaviors. Jess Hendrix from Hy-Vee emphasized the need to understand the multitude of touchpoints in the customer journey and the growing importance of psychographic and behavioral data. The concept of omnichannel commerce was central, with discussions on how to create seamless experiences across digital and physical retail environments.
Future Directions in Retail Media Strategies
Looking ahead, the summit underscored the need for continued innovation in retail media strategies. Attendees were encouraged to focus on data quality, market confidence, and tailored incrementality approaches. The future of retail media, as envisioned at the summit, is one where advanced analytics, customer-centric strategies, and robust measurement frameworks come together to drive meaningful results for both retailers and brands.
Conclusion
As the industry moves forward, the insights shared at the 2024 Path to Purchase Retail Media Summit will undoubtedly shape strategies and investments in the rapidly evolving world of retail media.
