Ask the Expert: How can c-stores tap into the power of retail media networks?
With growth set to skyrocket, retail media networks (RMNs) in Canada are gaining attention from global market research firms and commerce marketing agency giants looking to tap into the data-powered targeting of these networks on behalf of CPG clients.
Earlier this year, eMarketer released its first-ever Canadian forecast of ad spending on RMNs and estimates the format will surge past $3 billion in 2024, almost double the amount they attracted from advertisers three years ago. By 2027, it predicts spend on retailer-owned ad platforms will surpass $5 billion, a 60% jump over 2024. And as a percentage of total digital ad spending, RMNs will grow from a 15.5% share of the Canadian pie in 2022 to 27.8% in 2027.
Now Mars United Commerce has released its first-ever Retail Media Report Card: Canada to help “clients efficiently evaluate spending opportunities across networks.”
“I’ve been in this business for almost 20 years and it’s one of the fastest growth trajectories of an advertising platform that I’ve ever seen,” says Victoria Cromie, Mars United Commerce's Toronto-based managing director for Canada. “Fuelled by digital, the data that retailers are able to collect and optimize on is immense.”
The report card evaluates four RMNs: Amazon Advertising, Instacart, Walmart’s Connect and Advance powered by Loblaw. Amazon and Instacart—the latter which has partnered with U.S. grocers to help grow their RMNs in terms of owned websites, social channels and apps—focus their networks, naturally, on the digital ecosystem. Walmart’s Connect and Advance powered by Loblaw offer vendors access to their customer data to build targeted promotions and campaigns that reach in-store (digital screens, sampling, etc.) as well as digital and mobile assets.
Avoiding the pitfalls of generalized data, RMNs enable brands “to hyper-target whether it is a new shopper or a repeat shopper” at any point in the purchasing-decision shopping journey, says Cromie. “A salsa brand, for instance, can target a shopper with an offer when she adds tortilla chips to her shopping basket, knowing a lot of customers buy them together.
“And as we move towards a third-party cookieless data environment, advertisers are going to be relying heavily on the datasets of first-party partners,” she adds, noting the frequency and recency of retailer data is second to none.
The big c-store chains have been slow to invest in RMNs despite their large physical footprints and growing digital properties.
However, in the autumn of 2022, 7-Eleven announced the launch of Gulp Media Network. Noting most products purchased at its stores are consumed within 30 minutes of purchase, 7-Eleven says Gulp Media aims to help vendors influence consumption purchase occasions with targeted ads and offers. The Gulp Media Network, according to its website, leverages social media, including TikTok, Meta and Snapchat, as well as connected TV, in-store radio and streaming audio. The network is also set to add gas station TV screens.
Alimentation Couche-Tard hasn’t formalized a retail media network for its Circle K and Couche-Tard stores in Canada. However, the company has forged interesting partnerships with other networks around the world. In 2022, Dublin-based RMN Intouch.com announced a partnership with Circle K Egypt and K-TV, their retail media partner, to use AI, machine learning and IoT technologies in bringing “in-store digitization to the next level. Today, CPG brands and advertisers can advertise their products in any of Circle K’s branches using Intouch.com’s AI-driven in-store customer personalization platform.”
It's likely advertising can be combined with Circle K Egypt’s digital channels, as well.
As big c-store chains venture into this space, they may want to look at Loblaw, which launched its retail media network, Advance, in 2019 for inspiration. The network scored well in the Mars report’s Retail Media Health Scorecard across five areas—targeting; measurement and reporting; media opportunities; innovation; and partnership.
According to the report, Loblaw is beta-testing omnichannel measurement capabilities with Advance that will report the impact on in-store and ecommerce sales from campaigns spanning in-store, offsite, onsite and loyalty activation.
As well, offsite media targeting has expanded to include socio-demographic audience segmentation. New opportunities at Shoppers Drug Mart, meanwhile, include sponsored products on e-commerce platforms and screen media in stores. Elsewhere, supply chain information is now available in the Loblaw Data Insights & Analytics portal.
Cromie says the goal is to expand the scope of the Canadian Retail Media Report Card to include other networks.
She also notes it’s not too late for c-stores to ramp up RMNs, pointing out the sector’s rich first-party data sources from their loyalty programs, websites and apps, which would help brands drive sales, optimize search criteria and retarget with more success. “They could provide advertisers and their vendors with strong datasets of different Canadian audiences, because with gas and convenience, you’re getting a wider demo than perhaps a higher-end grocery story might,” she notes. “C-stores can provide the targeting scope of a Loblaw, which has higher-household income targeting through their Loblaw banner to lower-income households with discount banner No Frills.”
