A fifth of UK supermarkets which haven’t already are planning to roll out dedicated media groups to capitalise on booming retail media sales spend, according to a survey by Criteo.
Some 21% of the chief marketing officers at UK grocery businesses questioned wanted to follow in the footsteps of Boots and Tesco in launching media divisions.
“If you look at any big-name retailer in the industry, you’ll notice they’ve built, either on their own or more likely with the help of an ad partner, a retail media business,” said Brian Gleason, chief revenue officer at Criteo, which works with Carrefour on its Carrefour Links media platform.
Such a move “enables companies to create personalised advertising experiences and generate new and high-margin revenue streams” he said,
In November, Tesco launched Tesco Media & Insight, powered by Dunnhumby, with Tesco CEO Ken Murphy saying earlier this year that advertising could be a “significant contributor over time” to its revenue.
Boots partnered with commerce marketing firm Threefold on its Boots Media Group service late last year, giving brands the opportunity to tap the seven million active members of Boots’ Advantage Card loyalty scheme. They can also deliver campaigns in-store, across the retailer’s digital platforms, and on social media. Co-op, Deliveroo and Sainsbury’s also offer dedicated media services.
The fifth of UK grocers seeking to launch dedicated media groups was slightly higher than the 18% of CMOs who intended to across general retail.
A number of factors are pushing up demand for retail media opportunities – including the upcoming ‘cookiepocalypse’ in 2023, when Google Chrome is due to phase out third-party cookies, and the appeal of the first-party data held by supermarkets such as EPoS and loyalty data, which allows advertisers to be more targeted in their marketing efforts.
According to Criteo’s Future of Commerce study, where retailers are already offering advertising space across their online properties, CMOs reported revenue from such ads had risen 24% over the past 12 months.
Goldman Sachs forecasts UK grocery retail media market value to hit £2bn by 2024.
According to Criteo’s survey, 93% of UK grocers have a waiting list for brands who want to place ads on their site, and 65% said better monetising advertising was a “strategic priority”.
However, CMOs were divided on how their company retail media should be structured – with half saying responsibility should sit with them, and the other half expecting it to be led by the CEO.
“Given the explosive growth of media networks, many consumer-facing industries are ripe to benefit from this movement,” Gleason added.
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