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10 minutes of expert insights every weekday. Your morning ritual for staying ahead in retail media.
The Case for the ‘Long Tail’ of Retail Media Networks
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[00:00:00] Kiri Masters: The retail media industry is obsessed with scale. Amazon, Walmart, Kroger. These are the names that dominate every conference, keynote, and media plan.
[00:00:11] But here's a question that doesn't get asked enough. If you're a [00:00:15] brand selling grocery items in St. Louis, Missouri, and you're only running retail media through Target, what about the other half of shoppers walking into a local Schnucks every week?
[00:00:28]
[00:00:29] Kiri Masters: [00:00:30] Dave Glazer runs digits an agency with an unusual dual role. They help major CPGs execute retail media campaigns, but they also operate retail media networks on behalf of regional grocers. [00:00:45] That dual vantage point straddling both sides of the retail media divide Helps give Dave a perspective that most observers lack on a recent episode of The Beyond the Shelf podcast with Dave Feb, dave Glazer made the [00:01:00] case for what I'd call the long tail of retail media, and he sees a lot of Wyatt space in regional grocery in particular.
[00:01:09] Dave Glaza: Uh, well, the regional side is what we're working on.
[00:01:12] Probably the biggest white space right now. [00:01:15] Um. On that half of our business is, you know, regional grocers, and by that I mean grocers that have maybe 50 to 200 stores that are really awesome in their market. We have grocery partners that compete one-to-one [00:01:30] with Walmart in their market, but they're only maybe in a couple of states or a few DMAs.
[00:01:34] But you know, within that market, if you shop groceries. You're just as likely to go to them as you are to go to Walmart. And so helping them build platforms for brands to win, um, [00:01:45] is something we've been super focused on. So, you know, right now we have what we call our digits arm in which is that connection of those regional grocers, um, and helping them run it in a coordinated way across the, the pack, um, is sort of where we're at.
[00:01:59] And then we're focused on [00:02:00] rolling that solution out across more and more grocers. So the best way we help our regional brands and our regional grocers is by reducing that fragmentation. And so if we can go from running a handful of grocers to dozens, you know, [00:02:15] there's a way for us to, you know, sit in the middle and help both the regional grocers and the brands out, um, and really solve that fragmentation problem,
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[00:02:23] Kiri Masters: Now I've written extensively about why brands hit a wall at 5, 6, 7 retail [00:02:30] media networks and various studies from the industry. Back this up. Here's one from the A NA. 57% of advertisers cite lack of standardization as their top challenge. The reality is [00:02:45] that managing Network number 11 requires nearly as much infrastructure as Network five for a brand, but it generally delivers a fraction of the reach.
[00:02:55] So I get why brands draw a line in the sand [00:03:00] and have some kind of arbitrary number of RMNs that they wanna deal with directly. But Dave has a challenge that is worth sitting with.
[00:03:08] Dave Glaza: you know, the pushback we have is well. Don't you want to talk to all the customers that buy your product [00:03:15] or shouldn't that be the starting point? And by customers, I don't mean necessarily like retailers, I mean the actual shoppers, right? Mm-hmm. I mean, the example I was giving, you know, Schnucks is one of our best clients in St.
[00:03:25] Louis, and like I said, they're, they're. They compete very closely with Walmart on a market share [00:03:30] basis is if you're only talking through Walmart's, RMN, you're literally walking away from half the town. Like, is that the way you want to do it? Like I think those decisions make sense when you look at a spreadsheet of reach from a pure media point of view.
[00:03:44] But if we go back [00:03:45] again to your, one of your original questions about like merchants, I mean, merchants are looking at, well, I can send more units out of all of these doors. Like, how do I take a broader approach? And so I think we'll see quite a bit of change in the market in the next couple years of, [00:04:00] you know, if, if business starts to tighten up, um, you know, how are you driving business out of not just your top three accounts?
[00:04:08] Um, but there's a ton of business to be one, um, in the mid-market and the regionals as well.
[00:04:12] Dave Feinleib: Now, is that tech you've built yourself [00:04:15] or is it something you bought, or how does that work? We like to
[00:04:19] Dave Glaza: think of ourselves as tech agnostic. So we're, we're not, we're more of a business services firm, I'd say we. Tried the approach historically of like bringing a tech. [00:04:30] Um, and the challenge is, is uh, in, if you think regional groceries fragmented in media, they're also fragment fragmented in tech.
[00:04:38] So, you know, we've been able to come in and help grocers regardless of their tech. So we have partners that are on the Instacart store [00:04:45] form Pro platform. We have partners that have built their own. Uh, we have partners that are on more legacy, um. Legacy e-com and in-store tech. And so I'd say we pride ourselves on being pretty tech flexible.
[00:04:57] Um, of course we have a, I'd [00:05:00] say we have a portfolio of tech partners that are preferred that, you know, helps us work the best. Um, but if we are, if we had our own tech, I actually think it would be harder to grow because. You know, most retailers can only pick one POS platform or one eComm platform. [00:05:15] Retailers know that a marketplace model can dramatically boost product assortment, shopper engagement, and total revenue. But to get the most out of your marketplace, you [00:05:30] need an ad tech solution that can really engage sellers. Miracle Ads is powering the future of retail media for leading retailers to activate both three P Sellers and one P brands.
[00:05:43] Kiri Masters: Learn [00:05:45] more@miracle.com. That's M-I-R-A-K l.com.
[00:05:50]
[00:05:51] Dave Feinleib: The other area I wanted to ask you about is measurement always a kind of a hot potato topic, but, uh, what do you see working there and, uh, [00:06:00] what is kind of the best practices these days?
[00:06:03] Dave Glaza: Yeah, I mean, the, the brands will ask you for standard KPI measurement, you know, across all of your assets, across all retailers. I mean, that's, I mean, brands would love to be able to have everything on one spreadsheet and be [00:06:15] able to optimize to it. So I, I think. What people expect is standard as best method is obviously roas.
[00:06:23] I mean, that's a pretty standard, you can different attribution windows, but that's the bread and butter I roas I think at this point is [00:06:30] expected, but a lot more of our RMNs and our brand partners are leaning into other metrics around, um, new to brand, um, that that's one as well. And then I would say new to category and what percentage they're winning within those.
[00:06:43] Uh, some of [00:06:45] our brand partners are, say, are starting to lean away from ROAS and more towards some more of these ancillary metrics. Um, you know, it's been harder, I'd say, for some regionals to kind of keep up in that space because the metric requests change. Um, and the brands can be a [00:07:00] little demanding and what they're looking for, but Right.
[00:07:02] You know, it's their money. They could, they, uh, they have the right to sort of ask for things if they want, um, within this space.
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[00:07:08] Kiri Masters: I think that Dave's last comment there is really at the crux of it, that 200 plus retail media [00:07:15] networks is unsustainable. That hasn't changed. Brands want simplicity and brands want to spend their money where they're going to get the best return. Whatever that return is, however that is calculated,
[00:07:29] but his [00:07:30] challenge still holds, brands already have the infrastructure to reach regional shoppers through their sales teams, and And broken networks, the answer probably isn't forcing regional spend through centralized media teams. It's [00:07:45] recognizing that local activation can flow through functions that already own those relationships within a brand that doesn't solve the measurement gap, and it doesn't create the standardization that brands.
[00:07:57] Say they really want, but [00:08:00] it might be more realistic than expecting brands to staff up teams capable of managing 40 networks. If you'd like to hear the full interview, check out the Beyond the Shelf podcast. It's one of my personal recommendations. We'll link up to it in the show [00:08:15] notes. Thanks for listening, and I'll catch you tomorrow.
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