BrainTrust Query: Does the surge in shopper media mean a sea change for brands?
By James Tenser, Principal, VSN Strategies
The Wal-Mart Network has said its 390 million-plus monthly shopper traffic represents the largest media audience in America. Operated by San Francisco-based Premier Retail Networks, its 125,000 in-store video screens rake in an estimated $100 million in annual ad revenues from consumer brands.
A new multimedia in-store network now in test at Kroger stores claims a potential 68 million weekly shoppers when rollout is complete to 2,500 stores. In-Store Broadcasting Networks, Salt Lake City, is building the network.
Flat panel video installations located in about 1,000 Albertsons stores deliver messages to some 10 million shopping households in a four-week flight. SignStorey, Fairfield, CT operates the network.
Digital and networked media are popping up in all sorts of retail environments – from the flat video panels now gracing some Simon Properties shopping malls – to the gas pump islands at convenience stores – to the elevator cabs at major hotels – to the large screens in sports bars – the TV walls in large electronics stores – to the shelves, aisles, floors, carts and checkout lanes of supermarkets and mass retailers.
In recent months, the industry has been edgy with talk about planned shifts in media spending – away from so-called “traditional” media like TV and print, and toward the new breed of shopper media networks that put the message right at the point of decision. The mantra is “in-store activation” and the ad agency business is on high alert. Rightly concerned that an important fraction of media billings may be relocated outside their comfort zone, several large agencies have acquired or established units with special focus on at-retail media. WPP Group, Grey and Saatchi lead the pack
For the marketers charged with the care and custody of brands, this fast-changing media environment poses several great challenges. One, making apples-to-apples comparisons of in-store audiences with at-home audiences is a non-trivial undertaking. Two, in-store activation implies a need to measure effectiveness well beyond frequency and reach – to a true ROI. Three, new know-how is required for brand marketers to optimize the marketing mix.
Discussion Questions: Does the present expansion of shopper media mean a lasting change is coming in the way brands come to market? What does this mean
for “conventional” advertising media? Will gross rating points lose their meaning to ROI-based measures?
For the past two decades, I’ve repeated to all who can stand to listen that “the retail store is a communications environment for brand messages.” It seems
this has never been more true. Innovators are preparing to launch shelf-edge and shopping cart based devices in hundreds of store, tavern and hospitality environments as we speak
Not only are significant dollars migrating from conventional media budgets into the retail environment, but significant efforts are being made to quantify
the payback from at-retail advertising. These range from the conventional (GRP measures) to the esoteric (marketing mix modeling).
I submit that brand stewards and their agencies are facing a discontinuous professional moment. They need to get very smart about shopper media, very fast.