April 13, 2024

In the dynamic realm of retail media, Andrew Lipsman, an independent analyst and consultant, offers profound insights into its recent surge and future trajectory in a Beet.TV interview. Recognized as one of the early chroniclers of the retail media phenomenon, Lipsman sheds light on the factors propelling its rise and delineates key areas of evolution in the months ahead.

Lipsman traces the genesis of retail media’s ascendance to the widespread acknowledgment of its profitability, exemplified by Amazon’s robust ads business. However, he underscores that the narrative has transcended Amazon, with other retail juggernauts like Walmart leveraging platforms such as Walmart Connect to bolster their bottom lines. This paradigm shift has catalyzed a seismic awakening across the industry, igniting a fervent pursuit of transformative initiatives.

Lipsman’s Insights:

  • “We’re witnessing just the tip of the iceberg. Retail media’s potential remains largely untapped, offering many opportunities beyond the confines of Amazon’s dominance.”
  • “Walmart Connect and similar initiatives have demonstrated that retail media can be a game-changer in driving bottom-line profitability for retailers.”

Lipsman emphasizes that central to retail media’s expansion is the pivotal role of search-based advertising. While the initial focus centered on onsite search optimization, Lipsman contends that the sector harbors immense growth potential, with over 50% of forthcoming investments projected to flow into search-based advertising.

Lipsman on Search-Based Advertising:

  • “The early money was really in onsite search, but there’s tons of opportunity and runway in search. More than 50% of the new money will come into retail media over the next four years is search.”
  • “Search-based advertising remains a cornerstone of retail media’s growth strategy, offering advertisers unparalleled targeting capabilities and ROI.

Moreover, Lipsman underscores the burgeoning opportunities in offsite media channels, including the open web, social platforms, and streaming TV. As consumers increasingly engage with digital content across diverse platforms, retail media networks are poised to capitalize on this trend by extending their reach beyond traditional onsite channels.

Lipsman on Offsite Media Channels:

  • “The convergence of retail media and streaming TV is particularly compelling. By harnessing targeted advertising capabilities, retailers can unlock new revenue streams and democratize access to TV advertising.”
  • “Offsite media channels represent the next frontier for retail media, offering advertisers unprecedented reach and engagement opportunities beyond retailer websites.”

However, Lipsman acknowledges the challenges associated with retail media, particularly those related to measurement and standardization. He advocates for greater transparency and uniformity in metrics to empower advertisers to make informed decisions.

Lipsman on Measurement and Standardization:

  • “As retail media continues to evolve, standardization and transparency will be paramount. By providing consistent metrics and attribution frameworks, retail media networks can cultivate trust and confidence among advertisers.”
  • “There needs to be more standardization around incremental return on ad spend. Retail media networks should provide both return on ad spend and incremental return on ad spend, along with transparency around attribution windows.”

Looking ahead, Lipsman anticipates a pivotal year for offsite retail media, with investments surging into emerging channels such as streaming TV and in-store advertising. While the market may take time to mature fully, Lipsman remains optimistic about the long-term prospects of retail media as a transformative force in the advertising landscape.

Lipsman’s Outlook for the Future:

  • “In-store advertising, in particular, holds immense promise as the next major media channel. With the advent of digital screens in retail environments, we’re witnessing the dawn of a new era in advertising.”
  • “While the market for offsite retail media may take time to materialize fully, the groundwork is being laid for exponential growth in the coming years.”

As retail media continues to reshape the advertising landscape, Lipsman’s insights are a guiding beacon for industry stakeholders navigating its complexities. With innovation and collaboration steering its trajectory, retail media stands poised to redefine the future of advertising in the digital age.