Retail media networks still in the R&D stage, says ad execRetail media networks still in the R&D stage, says ad exec

Retail media networks might have taken a backseat to artificial intelligence as the tech darling du jour, but they continue to grow, and Andy Murray, executive chairman of the communications and advertising agency Saatchi & Saatchi X, called them an “unstoppable force.”

Murray, who spoke at a full-day conference on retail media networks, sponsored by the National Retail Federation and digital signage company STRATACACHE, earlier this month, noted that retail media networks face challenges but are taking a bigger slice of the marketing pie, according to consulting firm Bain & Company. 

“Bain has estimated that by 2030, retail media networks are expected to account for about 50% of the total digital marketing expenditure. When you have that kind of money shift, a lot of things are going to happen, because you're talking billions of dollars that are moving across ecosystems, and that requires a lot of change around those ecosystems,” he said.  

The blurring lines between marketing and commercial teams—what’s the role of the chief marketing officer versus the chief of sales or chief merchant—has given some brands and retailers pause when considering retail media networks.

Also, some brands are holding back on retail media networks until they can prove the strategy leads to incremental growth, Murray said.

“A lot of CPGs have tapped out their investment levels on the test and learn side, and are not ready to take that plunge into bigger spends until some of the other journey elements are resolved. So you get this kind of plateauing effect, which is where I think we are today,” Murray said. 

He said that leveling up on retail media networks means transitioning an organization to be more comfortable with uncertainty and moving from a profit-centric to a customer-centric mindset.

Retail media networks are still in the research and development stage, and siloing that research can slow down progress, according to Murray. The idea that businesses must have firm data before taking a step forward is “an optimization mindset, not an innovation mindset,” he said. 

“We must move from siloed structures (internally) to a synchronous community,” he said. “What leader ever woke up and said, ‘We need more silos.’ I haven’t heard that one yet.”