Revolutionize Your Supermarket Chain: Unleash the Power of Retail Media Networks

6 min readApr 4, 2023

If you’re seeing CPG profit margins drop in your supermarket chain, while feeling misunderstood by your consumers, who keep trying to lower the price even more, you’re not the only one. According to data science firm Dunnhumby’s survey, grocers earn a 2.5% profit margin, while consumers believe they earn 32.5%, reports Supermarket News. Talk about a gap.

Increasing product prices is obviously problematic in this situation. Therefore, to improve profits, an increasing number of supermarket chains now establish retail media networks — and brands are loving it. Global retail media spend is expected to be 121.88 billion dollars in 2023, according to Statista — and that’s in digital alone. Moreover, its “global retail media spend… is expected to be the fastest-growing channel this year and next, according to [our] latest analysis,” reports WARC.

Source: Statista

But what exactly is retail media?

What is Retail Media?

Amazon suggests thinking of it “like a ‘digital shelf,’ where you can announce special offers. Because, yeah, it basically means advertising.

Supermarket chains develop retail media networks to optimize the monetization of their online and offline real estate assets, including:

Website
App
Shelves
Banners and screens inside and outside their stores

Some of this can be combined, say…

Smart shelves that trigger contextual, individualized advertising on the supermarket chains’ apps, depending on a consumer’s specific behavior.

But either way, supermarket chains have at least three low-hanging fruit ad clients:

Themselves. They can advertise their own products to introduce new products, increase sales, get rid of low-selling inventory, and even improve brand affinity and loyalty by speaking up about social topics that matter to their customers.
Their partner brands. We know that a brand’s location on your shelf matters. So does its visibility across the rest of your assets.
Complimentary companies, such as medical or real estate service providers.

Ready to get strategizing?

Unveiling 3 Key Strategies Supermarket Chains Use to Grow Their Retail Media Networks

Now that we know what retail media networks are about, let’s explore how supermarket chains can set themselves for success.

Think Beyond “Buy Now” Ads

Sure, sometimes consumers need to know there’s a very special offer, for a very limited time, and they literally need to “buy now” to get it. But usually, if you want to capture long-term attention and build relationships that keep them coming back, remember this:

“Functional magnetic resonance imaging (fMRI) shows that when evaluating brands, consumers primarily use emotions (personal feelings and experiences), rather than information (brand attributes, features, and facts)” — Psychology Today

So what can you do?

Think of what works elsewhere:

Practical tips on blogs.
Step-by-step tutorials on YouTube.
Visual creativity on Instagram.
Quick entertainment and/or authentic, real-life experiences on TikTok.

Look for ways to recreate that through your retail media network. For example:

Want consumers to buy an “underdog” kind of vegetable? Broadcast a step-by-step video tutorial in your stores that shows how it can elevate an “overused” food. You can make it simple enough for consumers to buy the veggie, remember the recipe, and take action. Or you can make it more complex. In this case, send them to your website or social media channels to watch a more detailed explanation.
Showcase consumer-generated photos that show creative usages of mundane products.
Share inspiring stories of consumers or influencers who overcame challenges related to your products. If you sell back-to-school merchandise, share stories of how school made a difference in people’s lives. In addition, share stories of people who found school challenging, yet they found their path to happiness anyway.

Provide Personalized Experiences

“Gain[ing] access to a retailer’s first-party data” was the number one reason US CPG brands decided to work with retail media networks, according to eMarketer. A similar reason — “better understand the shopper at the retailer” — ranked as the third top reason, following a desire for stronger relationships with retailers themselves.

Source: eMarketer

When supermarket chains develop their own networks, they gain lots of first-party data that allows both them and their partners to personalize consumers’ experiences in a way that feels like you “get them.” Consumers get the right content or offer, at the right time, on the best channel, with messaging that speaks their emotional or logical language.

A couple of the ways your first-party data allows you to personalize consumers’ experiences:

As mentioned above, when consumers walk near a department or a shelf that your system knows interests them — for example, based on what they browsed online — you can trigger app messages with special deals.
Alternatively, use your offline knowledge to make suggestions via your website. If you have a consumer — or a segment — that’s into healthy living, send over a discount code for a juice maker or a free invitation to a virtual cooking class with a brand partner.

Your relationships with your brand partners are bound to grow stronger as well.

Go Off-Site

For even greater growth, supermarket chains can extend their inventory beyond their own assets. One way to do that is to partner with other companies and advertise on their assets as well. A few ideas for such partners:

Complimentary businesses, such as fashion stores, school supply stores, and gyms.
Content websites, such as cooking blogs, lifestyle websites, or personal finance apps.
Advertising supply-side platforms (SSPs), that sell advertising impressions.

Another way to do it is to go to platforms such as connected TVs (CTVs). Meaning, advertise to consumers who stream content on smart TVs that connect to the internet.

“98% of brands believe that connected TV advertising will be bigger than mobile advertising, with 25% claiming it will happen in 2–3 years,” discovered a late 2022 AppsFlyer survey.
This is understandable when you see that consumers remember ads from TV and streaming devices better than other ads, according to a tvScientic survey.

Source: tvScientific

Just like on YouTube, you can position your ads before, during, or after a content piece (a show or a movie) your consumers watch. Ads aren’t clickable here but are retargetable.

Retarget viewers who’ve proven to be relevant by how they’ve interacted with your content and ads on other platforms.
Retarget CTV viewers across the internet once they’ve shown interest in your CTV ads.

Either way, when you expand beyond your own assets, you can:

Advertise your own products, and
Arrange a deal for better advertising fees for your partner brands, assuming you can bring big brands’ budgets to a supplier.

As you can see, retail media networks provide many growth opportunities for supermarket chains. However, before you jump in, beware of common challenges.

Overcome Common Retail Media Network Challenges

Over time, managing inventory gets messy. It’s easy to double book ad placements, for example, or deliver inaccurate data to your partners. Data comes in quickly, in massively growing amounts. It becomes more challenging to analyze it in an accurate, proactive way that leads to a profitable strategy.

That’s exactly why we founded ADvendio, a retail media platform that seamlessly supports your ad management, both online and through brick-and-mortar stores. It’s a comprehensive platform that supports all media channels and a variety of needs. That said, it can be customized to your specific needs, no matter where your supermarket chain is in the process.

It’s already trusted by leading global companies, but we recommend you get a free demo to see how it can help your specific team manage a profitable, valuable retail media network.