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10 minutes of expert insights every weekday. Your morning ritual for staying ahead in retail media.
Retail Media Isn’t a Cart
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[00:00:00] Kiri Masters: welcome back to Retail Media Breakfast Club. Today I'm reading a guest contribution from Tom Limongello, host of the Middlemen Podcast, and you might remember that name because Tom and I chatted about Redfest Media, Ace [00:00:15] Hardware's upfronts last week. And, um, Tom is back in the newsletter because I'm out this week on a family vacation in Poland with my mom and dad and brother doing a special bucket list [00:00:30] kind of trip.
[00:00:31] So I called in a couple of friends of the show to contribute some pieces that they have shared recently on their own newsletters that I personally handpicked because I thought that they were great. This one [00:00:45] from Tom today is called Retail Media Isn't a Cart, and it got me thinking because I tend to focus on retail media networks in this newsletter.
[00:00:56] Retailers have unique needs and [00:01:00] assets, as do any other type of commerce player. If we're talking about travel or payments, they all have something quite unique to offer. But I just personally feel like I can provide the most value in this space since I know it [00:01:15] best relative to these other categories.
[00:01:17] But of course, I am very curious about the broader commerce media ecosystem and this better together kind of data story. And as Tom explains in this piece, the ability to understand [00:01:30] and address entire shopping missions is the real unifier here So I'm gonna jump in and narrate Tom's piece for you today.
[00:01:38] Let's go.
[00:01:39]
[00:01:40] Kiri Masters: To tell you the truth, I was low-key genuinely [00:01:45] going to just delete the segment Todd had on defining commerce media from the recent episode with Colin Colburn of the IAB. I was sitting there editing, and I heard Todd say, "I think we'd say that United [00:02:00] and the back of the screen or Delta's back of the chair screen is commerce media because it's not their cart, but their retail media might be if I was showing ads in the checkout of the plane ticket."
[00:02:12] I viscerally reacted to this [00:02:15] comment. Why the fascination with the cart? My experience with retail media started with offsite for retailers who hadn't even fully committed to e-commerce. More to the point, Todd and I had just sat on the Kroger [00:02:30] rooftop in Cannes with Christine Foster talking about how a consumer could be targeted on TikTok using the retailer's audience, but that the cart is basically irrelevant on social for low-price products.
[00:02:43] Shipping a single can of [00:02:45] poppy because you discovered it on TikTok is absurd. Instead, you'll discover on social and then buy in store. In this case, the ad exposure was on TikTok, but Kroger was the merchant of record. Todd and I used to argue a lot, but it [00:03:00] was usually because we were both trying to explain the differences between the retail and media worlds.
[00:03:05] So I kept thinking about what was behind his definition and whether it could lead us to a better one. What I think might have been missing from our discourse was a very [00:03:15] specific retailer vocabulary word: assortment. A retailer's assortment is the complete set of products it chooses to sell.
[00:03:24] Broader commerce media networks can create demand for products and services outside [00:03:30] their own assortments. A year ago, we had Harsh Jandani on the podcast
[00:03:35] Harsh Jhandani, just as a side note, is at the ad serving company Cody
[00:03:40] And he gave us a simple definition of commerce media that was easy to [00:03:45] remember. For me, retail media is SKUs and commerce media is everything that's not SKUs, period. In many retail media systems, the SKU is more than the final record of what someone purchased. It is the [00:04:00] targeting language itself.
[00:04:01] Customers can become collections of product views, purchases, and affinities that determine which product should be promoted to them next. Harsh later in the episode explained why moving from keywords to [00:04:15] SKUs was an operational advance It gives the system greater precision about what is being advertised and ultimately purchased.
[00:04:25] That makes the SKU a useful way to operate retail media, [00:04:30] but not a definition of it. SKUs identify the products involved. Shopper missions explain what the person is trying to accomplish. That distinction matters across commerce media. Every network is trying to [00:04:45] understand a mission. What changes is whether it owns the advertised assortment.
[00:04:52] Retail media networks are generally organized around the retailer's assortment. Emerging commerce media networks can create demand [00:05:00] for products and services outside their own assortments. Travel is my favorite demonstration of why the shopper mission creates value even when the network doesn't own the advertised assortment.
[00:05:14] So when [00:05:15] Todd talked about the airline seatback screen, he was evaluating its function as a non-transactional surface and which advertisers can fit. If you've heard Todd recently on the podcast, he likes to think deeply about how endemic the [00:05:30] advertiser is to the retailer. The seatback screen and hotel room TV are not off-site media.
[00:05:38] They are owned and operated by the commerce media network
[00:05:43] What the network may not own [00:05:45] is the advertised offering. You're not buying another airline ticket or booking another hotel room. You're deciding what else you want from the trip, often on impulse. Impulsing grocery might mean grabbing [00:06:00] M&M's at checkout. Travel changes the scale. Once someone has paid for the flight and hotel, the impulse purchase might be a handbag, an expensive dinner, or an excursion.
[00:06:11] These purchases can feel justified because they help the [00:06:15] traveler make the most of what they have already spent, and therefore live the version of the trip they truly imagined Costco isn't scaling its [00:06:30] RMN with legacy ad tech and manual solutions. It's leaning into a cloud-centric composable stack. As part of the Costco Velocity Network, GrowthLoop empowers the [00:06:45] retail media team to build audiences directly from the Data Cloud, enabling faster activation, greater relevance, and better performance, all while maintaining privacy and governance [00:07:00] standards.
[00:07:01] The result? Exceptional value and experience for Costco members and better ROI for brand advertisers. Learn why the GrowthLoop Composable Commerce Media Solution was the right choice for [00:07:15] Costco's Velocity Network. Visit go.growthloop.com/breakfast. That's go.growthloop.com/breakfast
[00:07:29]
[00:07:29] Kiri Masters: In a [00:07:30] recent two-part study conducted by BCG and commissioned by Connective by United and Marriott Media, we see that travel purchases cover a whole range of categories. It would actually be inefficient for the Commerce Media Network to stock all of these [00:07:45] SKUs and experiences And within that, there's a little graphic that I'm just gonna talk through.
[00:07:50] It explains things like technology, excursions, beauty, fitness, health and wellness, automotive. These are [00:08:00] all unplanned purchases during travel that this combination of Marriott Media and Kinective can help to surface and deliver
[00:08:10] Not owning the assortment is part of what makes these commerce media networks [00:08:15] interesting. It's also what makes their measurement more complicated. Before moving on, it's worth pausing on who sponsored the BCG research. United and Marriott could each have commissioned research about its own audience.[00:08:30]
[00:08:30] Instead, Kinective Media and Marriott Media studied the traveler together across the journey. They are not combining assortments. They are recognizing a shared mission. The open question is whether that partnership extends to measurement
[00:08:44] If [00:08:45] United shows an ad for a hotel, the hotel or online travel agent records the booking. If Marriott promotes an excursion, the tour operator may become the merchant of record. The network owns the media exposure, but another [00:09:00] business owns the resulting transaction. At the end of our conversation with Colin Colburn at the IAB, he acknowledged that retailers are not incentivized to standardize their measurement.
[00:09:12] He His more practical proposal is disclosure. [00:09:15] Explain the attribution windows, the ROAS methodology, and incrementality approach so that advertisers can interpret the results themselves
[00:09:24] TravelMedia adds an earlier question. Before advertisers can compare methodologies, [00:09:30] does the outcome even make it back to the network that influenced it? After mulling over the seatback screen, carts, SKUs, and assortments, I think we've arrived at something more useful. A commerce media network [00:09:45] turns a first-party commercial relationship into media by using what it knows about a customer's mission to create demand for products and services, whether they are in its own assortment or offered by merchant partners.[00:10:00]
[00:10:00] Retail media fits within that definition, but it is generally organized around the retailer's own assortment. Kroger can reach someone on TikTok, promote a product that it carries, and record the eventual in-store purchase. Travel media [00:10:15] shows us the broader model. A network can understand the mission and own the moment of attention without fulfilling every need or recording every transaction.
[00:10:24] This gives us the next set of questions for shopper missions. What does each [00:10:30] network know about the mission? Who fulfills the resulting demand? Does the transaction return to the network that influenced it? If several networks participate, does anyone receive an assist? These are the [00:10:45] conversations we now want to have with travel, financial services, and mobility networks.
[00:10:50] Commerce media gets interesting when one business understands the mission and owns the moment of attention, while another owns the assortment and [00:11:00] records the transaction. Will they all play nicely?
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[00:11:05] Kiri Masters: So thanks again to Tom for contributing this essay. I'll link up to the original version of that, uh, from his Substack, and check [00:11:15] out the Middlemen podcast on your favorite podcast app.
[00:11:17] I know you're gonna love it. Thanks for listening, and I'll catch you tomorrow.
[00:11:21]