Key Takeaways from ShopTalk 2024
ShopTalk 2024 wrapped up last week, leaving attendees buzzing with insights and ideas. This year's event was particularly impactful, showcasing the rapid evolution of retail in the age of artificial intelligence (AI), personalized customer experiences, and emerging revenue streams.
In this article, I will delve into my critical takeaways from ShopTalk 2024, focusing on leveraging AI for personalization, the future of retail media, standout shoppable video offerings, and harnessing data and technology to create new revenue streams.
Launch of Epsilon Retail Media
We were excited to use Shoptalk as the jump board for us to launch our new brand of Epsilon Retail Media, combining the power of CitrusAd and Epsilon under one platform. Epsilon Retail Media?is the first platform to couple AI with person-first identity in the ad server, bringing people-based intelligence to retail media, enabling retailers and advertisers to exponentially grow their ability to drive sales while increasing brand loyalty.
Built on our core strengths, this platform further unites Epsilon’s existing suite of retail media solutions and CitrusAd?under?Epsilon Retail Media
The presence of offline data within our CORE ID is a key differentiator. Our person-first intelligence takes a dramatically different approach from traditional DSPs and retail media technology providers, who filter audiences based on where they are versus who they are, excluding a large portion of shoppers that advertisers want to reach out the gate. They then evaluate their ‘best guess’ of the shopper behind the impression, given their IDs are rooted in email addresses or other digital identifiers, not verified offline data. And when they do get around to evaluating the bid, they can only take a few variables into consideration before making a decision.
We kicked the Shoptalk event off with a sneak peek over dinner of the Epsilon Retail Media launch with our closest retailers, partners and advertisers - hosted by David Peterson
"Our person-first intelligence takes a dramatically different approach from traditional DSPs and retail media technology providers, who filter audiences based on where they are versus who they are, excluding a large portion of shoppers that advertisers want to reach out the gate" - David Peterson
David Peterson and Jaclyn Nix were interviewed (live from the Epsilon booth) by the great Tameka Kee from Beet.TV on the future of retail media.
The feedback from our valued clients, prospects and partners who dropped by the booth was immensely positive
Google announced an off–site retail media solution
谷歌 announced an off–site retail media solution through a closed beta in Search Ads 360 (SA360) where they are partnering with Lowe’s as one of their first beta partners.
What does this all really mean though?
Lowe's Companies, Inc. is launching an offsite retail media offering on Google Search and Shopping inventory, using a managed service model today and partnering with SA360 on the journey toward self-service options for their brand partners in the future.
Google Shopping is reserved for retailers with merchant accounts (brands cannot advertise directly and need to go through a retailer). Traditionally, this has been a quite a process for retailers to manage and execute. This lets brands reach high-intent shoppers with relevant ads, increasing performance while respecting consumer privacy.
The ads shoppers see would ultimately send them to a product detail page on a retailer’s website, at which point products could be purchased.
Leveraging AI to scale personalization
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AI continues to be a game-changer in retail, offering unprecedented capabilities to personalize customer experiences at scale.
"Circle K has 17,000 stores in 26 markets around the world. Our average customer visits our stores 2x a day. Creating personalized experiences is a must. You get one shot, and it must be at the point of purchase. We have created a recommendation engine (in the store) which we are very proud of. Using AI, we can make recommendations to the consumer. For example, if you have a bag of Doritos - the engine might suggest a Mountain Dew, which might seem very basic, but culturally we are very comfortable in saying 'grab a Mountain Dew on your way out'. That's the power of culture and technology coming together with the power of personalization and AI" - Kevin Lewis
In the fast-paced world of on-demand delivery, customer satisfaction hinges on speed, accuracy, and, crucially, the availability of desired products. One of the most common friction points in this process is the unavailability of specific products or SKUs at the time of order fulfillment. DoorDash is tackling this challenge head-on by leveraging AI to automate and personalize product SKU substitutions for out of stock products, ensuring customers receive what they want without delay.
Out of stock (OOS) situations are not just a minor inconvenience; they represent a critical moment of truth in the customer journey. Traditional approaches to managing OOS scenarios, such as offering a limited set of pre-selected alternatives or requiring manual input from the customer, often lead to frustration, abandoned carts, and lost sales. In contrast, DoorDash's innovative approach uses AI to transform this challenge into an opportunity to delight customers by offering personalized, smart substitutions.
DoorDash's AI-driven SKU substitution system is a game-changer. It goes beyond basic product replacements by understanding the nuances of customer preferences and order history to suggest alternatives that are both relevant and desirable. This system is built on a sophisticated algorithm that analyzes various factors.
DoorDash's AI-driven SKU substitution is just the beginning. The future holds potential for even more advanced applications of AI in on-demand delivery, such as predictive inventory management, dynamic pricing models, and personalized marketing campaigns. As AI technology continues to evolve, it will further enhance the ability to anticipate customer needs, improve operational efficiencies, and create more personalized, engaging customer experiences.
"So if you order a pack of cookies, and those specific cookies are out of stock. The question is 'what does a Dasher do?'. Having good data to understand what substitutes are available to make for substitution is really important. Some of our early models weren't that great - an alternative cookie brand like Chips Ahoy might be recommended, but sometimes you might get a recommendation of Cookie Dough ice cream. So for us, it was about the integrity of the data. We started with an unsupervised learning model where we had consumer feedback. We then moved onto supervised learning models where we continued to improve our models. The results are we now have better substitution recommendations, which results in Dashers being able to quickly find the item, and we are making the experience better fort the consumer" - Jessica Lachs
The integration of Audio Out of Home (AOOH) advertising with artificial intelligence (AI) is setting a new benchmark for the in-store experience, revolutionizing how retailers connect with consumers. AOOH advertising, a burgeoning force in the retail sector, now leverages AI to deliver personalized and dynamic audio content, transforming passive shopping environments into interactive, engaging experiences.
AI's role in enhancing AOOH advertising lies in its ability to analyze vast amounts of data in real-time, enabling the delivery of tailored audio messages that resonate with individual shoppers based on factors such as purchase history, demographics, and even current in-store behavior. This level of personalization ensures that consumers receive relevant, engaging content that enhances their shopping journey, fostering a deeper connection between the brand and its audience.
Moreover, AI-driven AOOH advertising optimizes the timing and placement of audio messages, ensuring they reach the right ears at the most opportune moments. Whether prompting shoppers about a sale as they near a particular aisle or offering a soothing playlist to enhance the overall shopping ambiance, AI ensures that every audio interaction adds value to the consumer's in-store experience.
We are seeing the hospitality, gas/petrol, liquor, and convenience store (C-store) verticals jump in to this technology in a big way - with pioneers in the space like QSIC leading the way with innovation.
The fusion of AOOH advertising with AI is not just transforming the in-store experience; it's redefining the boundaries of retail marketing. By creating a more personalized, engaging, and memorable shopping environment, AI-enhanced AOOH advertising is helping brands stand out in a crowded market, ultimately driving loyalty and sales. As technology advances, the potential for even more innovative applications of AI in AOOH advertising promises to further revolutionize the retail landscape, offering an ever-evolving, immersive consumer experience.
Future of Retail Media
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This was one of my favorite sessions of the week. To be honest, any time with Andrew Lipsman and his insights into the current and future state of retail media (and the bigger picture) is always time well spent.
Andrew Lipsman attributed that search is still where a majority of retail media growth will come from over the next few years, but on-site retail media, while burgeoning as a strategic asset for retailers looking to monetize their digital properties, faces several challenges that can limit its scalability and effectiveness.
Data fragmentation - one of the primary limitations is data fragmentation across different systems and platforms within a retail organization. This fragmentation can impede the effective targeting and personalization of ads, leading to less impactful advertising campaigns.
Inventory constraints - onsite retail media is inherently limited by the retailer's own digital real estate. The available slots for advertisements on a retailer's website or app are finite, which can limit growth potential, especially as more brands seek to advertise on these platforms.
User experience concerns - there's a delicate balance between monetization and user experience. Overloading sites with advertisements can detract from the customer experience, potentially harming brand perception and customer loyalty over time.
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Integration and alignment with broader marketing strategies - retailers often struggle to integrate their on-site media efforts with broader marketing strategies. This lack of integration can lead to disjointed customer experiences and missed opportunities for synergies across channels.
Eric Tarnowski from Kenvue suggested that there is still opportunity for onsite to grow (and even that there is money being left on the table).
"We must remember that whilst there is a lot of headwind [with onsite] - we are still capped by a number of limitations that need to be overcome. I think the opportunities that will grow the most in this space are the ones who are able to expand the pie, not slice it up" - Eric Tarnowski
"I think the most interesting placements [in retail media] are the ones where you are coming in at the point of or after the ad to the cart. Those ones are really interesting. When someone is coming in and they already know what they are looking for - it is hard to compete or change their mind there. It is how we trigger those personalized journeys to get them to step out of that process and consider something" - Eric Tarnowski
In the United States, Tied House Laws form a complex regulatory framework that governs the relationships between alcohol manufacturers, distributors, and retailers. Originating from pre-Prohibition concerns about monopolistic practices and the undue influence of alcohol manufacturers over retail establishments, these laws aim to maintain a strict separation between the production, distribution, and sale of alcoholic beverages. However, these regulations also significantly impact advertisers' ability to invest in retail media, affecting how alcohol brands engage with consumers in retail environments.
Advertising Restrictions - Tied House Laws limit direct advertising opportunities for alcohol brands within retail spaces. Since manufacturers are generally prohibited from owning retail outlets or exerting undue influence over them, opportunities for in-store promotions, exclusive product placements, and other direct advertising strategies are restricted. This limits the visibility of alcohol brands in key retail environments, impacting their ability to engage directly with consumers at the point of purchase.
Challenges in Digital Retail Media - As retail media expands into digital platforms, alcohol brands face challenges in navigating the digital landscape within the confines of Tied House Laws. Although digital retail media offers innovative ways to reach consumers, alcohol advertisers must ensure their digital campaigns comply with the same regulatory standards that apply to physical retail environments. This includes avoiding practices that could be interpreted as exerting undue influence over retailers or violating the separation between tiers.
Despite these limitations, Emily Bibeault talked about how alcohol brands such as Campari Group have developed innovative strategies to work within the legal framework. This includes leveraging third-party marketing platforms that comply with Tied House Laws such as marketplace platforms like Uber Eats, DoorDash and Instacart .
"As the [expansion of retail media in the alcohol] space is growing, we are talking about the huge dollar opportunities, we are finding ways to [in a compliant way] use audience data to provide closed loop attribution through a third party partner such as CitrusAd " - Emily Bibeault
The restrictions imposed by Tied House Laws necessitate a more strategic approach to brand marketing and advertising. Alcohol brands must focus on creating high-quality content and leveraging data-driven insights to reach consumers through compliant channels. This often involves a greater emphasis on brand-building and storytelling, rather than direct sales promotions, to foster consumer connections and loyalty.
Offsite advertising is rapidly expanding through innovative partnerships between retail media networks and various platforms, combining the retail sector's rich data with the extensive reach of digital and streaming services. Notably, Kroger has teamed up with giants like 华特迪士尼公司 and Roku , bringing targeted advertising to streaming TV audiences. Instacart and 百思买 have also formed alliances with Roku , leveraging streaming to enhance their advertising impact. Meanwhile, 沃尔玛 's collaboration with NBCUniversal illustrates the potential of integrating retail and media ecosystems. On the publishing side, partnerships like 塔吉特百货 with Pinterest and 沃尔玛 with TikTok demonstrate the merging of social media engagement with retail objectives. Moreover, programmatic advertising collaborations, such as Walgreens with The Trade Desk and Lowe's Companies, Inc. with 雅虎 , highlight the strategic use of data and technology to refine advertising efficiency and effectiveness across the digital landscape. These partnerships signify a shift towards more integrated, data-driven advertising strategies that benefit both retailers and advertisers by reaching consumers more effectively across a multitude of channels.
Shoppable Video Offerings that Stand Out
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Shoppable video is transforming the way consumers interact with brands, merging entertainment with instant purchasing capabilities. Amy Worcester Lanzi opened the session with a keynote presentation on real life examples of how shoppable video is paving the way for the next chapter in RMN growth.
"When we think about this space and the marketing challenges today - it is really about what we say at Digitas - which is everything all at once. We are in a really interesting, transformational moment in the marketplace today. And it is driven by a couple of things. Consumers are wanting to discover and purchase in one moment. Consumers really want to have an experience. Brands are increasing how complex they are in the market (becoming ecosystems). They are selling products as a brand, but they also need to be a destination" - Amy Worcester Lanzi
The discussions at ShopTalk 2024 showcased innovative shoppable video strategies that stand out by offering immersive and interactive experiences. Commerce or shoppable experiences were the top of the talktrack. Digital media has catapulted everything to being a media investment, and so when brands are thinking about spending dollars - this is about how to spend your dollars to create commerce experiences. To captivate consumers, retailers are integrating storytelling, interactive elements, and real-time purchasing options into their video content. The key to success is creating engaging, high-quality videos that seamlessly blend content and commerce, enhancing the consumer's shopping journey.
"Consumers are telling us - they want to see more branded content. They are looking for (engaging and immersive) stories from brands. Consumers are wanting to buy directly through video whether it is CTV or OLV, and this is really driving their future intent and purchase" - Amy Worcester Lanzi
Fanatics is leveraging shoppable video technology to transform how fans connect with their favorite teams and athletes while seamlessly purchasing merchandise.
Shoppable video integrates interactive elements into video content, allowing viewers to make purchases directly through the video interface. This technology creates a frictionless path from product discovery to purchase, enhancing user engagement and potentially increasing conversion rates. For Fanatics, which caters to a passionate fan base eager for sports apparel and memorabilia, this approach not only drives sales but also significantly boosts brand awareness and loyalty.
Fanatics launched a new platform last year which mixes creator content, sports, and media partnerships with live shopping. The content features trading card “breaks,” limited-edition merchandise and collectibles drops, and on-location streams featuring high-profile athletes and entertainers.
“When we think about the scale of content that a retailer like Walmart needs, we in no way, shape or form can just create that from our marketing group, and so we rely heavily on tens of thousands of creators — micro–influencers — to really talk about our brand through their voice. And it’s the authenticity that they bring to the table that makes the content compelling enough for people to want to shop because they believe what that creator is saying.” - Jill Toscano
沃尔玛 is revolutionizing the shopping experience by integrating shoppable video, influencers, and user-generated content (UGC) into its digital marketing strategy, setting a new standard for retail engagement. Through shoppable videos, Walmart allows customers to make purchases directly from interactive videos, seamlessly blending content consumption with shopping. This innovative approach not only simplifies the buying process but also enriches the online browsing experience, encouraging immediate action from viewers.
In leveraging influencers, Walmart taps into the power of social proof and relatability. Influencers, known for their loyal followings and content creation skills, showcase Walmart products in a natural, engaging manner, making them more appealing to potential buyers. These influencers share their experiences across social media platforms, creating authentic narratives around Walmart’s offerings. This strategy not only amplifies reach but also fosters trust and credibility among consumers.
User-generated content further enhances Walmart’s approach by involving the customer directly in the marketing process. Encouraging customers to share their own experiences with Walmart products on social media platforms creates a sense of community and trust. This content acts as personal endorsements, further influencing buying decisions of potential customers. UGC also provides Walmart with invaluable feedback and insights into customer preferences and behavior.
By combining shoppable video, influencer partnerships, and user-generated content, Walmart creates a holistic, interactive shopping environment. This approach not only drives awareness and sales but also positions Walmart as a forward-thinking, customer-centric brand in the digital age, adept at navigating the intersection of technology, social media, and e-commerce.
Walmart is once again leading retail innovation with its groundbreaking 23-part shoppable commercial series titled "Add to Heart." This holiday-themed romantic comedy series was launched across popular platforms like TikTok , Roku , and YouTube , blending entertainment with interactive shopping in an unprecedented way. By featuring 330 Walmart products alongside intuitive add-to-cart buttons, Walmart not only told a story but seamlessly integrated a shopping experience into the narrative.
"Add to Heart" represents a significant leap in content marketing, where viewers can directly engage with the products being used or featured by the characters within the series. This direct engagement strategy capitalizes on the impulse buying behavior, as viewers can instantly add products to their cart while being emotionally invested in the story. The choice of platforms for airing the series—TikTok, Roku, and YouTube—is strategic, targeting a broad audience spectrum, from Gen Z to millennials, who prefer consuming content on these digital platforms.
This initiative follows Walmart's previous venture into shoppable content with a "scan to shop" feature in partnership with Bravo TV 's"Below Deck Mediterranean." The move towards a more integrated shoppable content approach indicates Walmart's commitment to innovating the retail experience, making shopping more interactive, engaging, and fun. By leveraging storytelling and the immersive nature of video content, Walmart aims to enhance the customer journey, making it more memorable and convenient.
The selection of a holiday-themed romantic comedy for the series is a masterstroke in marketing, tapping into the emotional highs of the holiday season and the universal appeal of romantic comedies. This theme ensures a wide reach, drawing in viewers with the promise of heartwarming content while subtly introducing them to Walmart's product range. The series not only aims to boost sales but also to strengthen Walmart's brand affinity among consumers by providing value through entertainment.
The integration of shoppable technology into video content is a trendsetting move by Walmart, highlighting the brand's agile approach to e-commerce. It blurs the lines between content and commerce, paving the way for a new era of shopping where the convenience of online retail meets the engaging nature of storytelling. This strategy is expected to not only drive awareness and sales for Walmart but also set a new benchmark in retail marketing, challenging other retailers to explore creative ways to engage with their audiences.
With "Add to Heart," Walmart is not just launching a commercial series; it's redefining the future of retail marketing. By fusing engaging narratives with shoppable technology, Walmart is enhancing the shopping experience, making it more dynamic and interactive. This innovative approach demonstrates Walmart's vision for the future of retail, where shopping becomes a seamlessly integrated part of content consumption, and engagement goes hand in hand with entertainment.
Harnessing Data and Technology to Create New Revenue Streams
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沃尔玛 has long been at the forefront of retail innovation, using data analytics not only to enhance its supply chain efficiency but also to personalize customer experiences and expand into digital marketplaces. By analyzing customer data, Walmart offers targeted product recommendations and optimizes its inventory to meet consumer demand more accurately. Additionally, Walmart has ventured into the advertising space with 沃尔玛 , now known as Walmart Connect , which utilizes customer data to offer suppliers and advertisers the opportunity to reach customers more effectively through digital ads on Walmart's platforms. This approach not only improves the shopping experience for customers but also opens up new revenue streams for Walmart through advertising.
"When we talk about creating value, it’s how do we create visibility on the journey of a product from source to shelf, and the journey of a customer from home to store. Ultimately, the two come together at the shelf, which is the point of conversion. To really maximize that point of conversion, we need to understand the behaviors and attitudes that drive a consumer to decide where they’re going to shop and what they’re going to buy. What Walmart Luminate does is it allows Walmart merchants and suppliers, and our partners throughout the entire value chain, to have a single version of truth. We look at how to create visibility into the journey of a product and the journey of a customer so that we understand better the point of conversion" - Mark Hardy
家得宝 has made significant investments in technology to remain competitive and relevant in the digital age. Through its proprietary analytics and data platforms, the company has gained deep insights into customer behavior, preferences, and trends. This information is used to tailor marketing efforts, optimize product assortments, and improve online and in-store customer experiences. Furthermore, The Home Depot has focused on creating an interconnected retail experience, where online and physical stores complement each other seamlessly. The use of technology extends to their supply chain, where predictive analytics help ensure product availability and timely delivery, enhancing customer satisfaction and driving sales.
Zalando has placed data at the core of its business strategy to drive growth and customer loyalty. The company leverages machine learning and artificial intelligence to offer personalized shopping experiences, from tailored product recommendations to individualized search results. This personalization strategy is supported by Zalando's vast collection of customer data, enabling the company to understand and predict consumer preferences with remarkable accuracy. Additionally, Zalando has expanded its business model to include Zalando Marketing Services, providing brands and retailers with data-driven insights and advertising solutions to reach a wider audience effectively.
Agitating for better design and experiences in retail
8 个月Great summary - thanks Adam
Business Development and Partnerships Executive
11 个月Great insights!