Last week, IAB Europe opened a proposal for industry comment focused on the measurement of in-store commerce media. The proposal splits the store into five zones, from outside the front door through to in-aisle, and sets out a simplified way to calculate “opportunity to see” from six inputs: footfall, store count, campaign duration, number of placements, aisle penetration and share of voice. It also tackles how to count impressions in stores with no sensor technology, which is most of them.
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This is overdue and welcome. A shared language means a brand can compare a screen in a Tesco with a screen in a Carrefour without needing three different spreadsheets.
A common language will also go a long way for retailers that have seen retail media investment hit a plateau. In Australia, the IAB Australia Retail and Commerce Media State of the Nation report found that 73 per cent of the industry cites measurement as the top challenge for the channel.
Currently, in Europe, 95 per cent of food and beverage spending happens in-store. Yet more than 99 per cent of retail media advertising spend remains online. That isn’t because in-store doesn’t work. It’s because brands put money where they can prove the effect.
Anyone who has sat through a retail media presentation about the impact of in-store assets knows the moment. It starts with a big reach number, a cost per mille (CPM), and then the brand manager asks what it sold. That question is usually met with silence.
The issue is that the only metric many retailers can call on for in-store media is “opportunity to see”. Let’s be honest about what “opportunity to see” is. It’s a considered estimate of who walked past your ads, but it tells you nothing about whether a single unit moved. And for investment to match the scale of in-store purchasing, there needs to be more proof than that.
American retailers are already further down the track. Earlier this year, Albertsons set out an in-store incrementality framework using close to 60 variables to match test and control stores and estimate what would have happened without the media.
Zones change how we plan
The five-zone model is the most useful part of the IAB’s proposal, and the least talked about. Shoppers don’t think the same way in the car park as they do at the fixture. Out front, they’re setting a mission. At the entrance, they’re open to suggestion. In the aisle, they’re choosing.
That should reshape planning. Instead of buying a network of screens, brands should buy a journey: build the idea outside, nudge at the front of store, close at the shelf. Each zone needs its own creative, its own KPI and its own price. Judging an entrance screen on sales lift is as pointless as judging a shelf-edge on reach.
The opportunity for the Australian retail landscape
Woolworths’ Cartology and Coles 360 are scaling in-store fast, with Chemist Warehouse, Bunnings and the big-box players close behind.
My worry is that we import the European framework, badge it “best practice” and stop there.
Three things would change the conversation here. Retail media networks should report incrementality as standard, not as a paid extra. When you own the stores, the tills and the loyalty data, test-and-control isn’t hard.
They should also measure the shelf, not just the screen. A beautiful ad above an empty gap is burning money. Availability and compliance belong in the same report as impressions.
Finally, publish the method. Brands trust what they can audit, and suspicion is the heaviest tax on this channel.
The store is still where the money gets spent, and it’s one of the few places left where attention hasn’t been auctioned into oblivion. That’s a genuine advantage, but only when retailers sell outcomes instead of footfall.
Simon Porter is head of retail at Hatched and founder of RX Worldwide.
Further reading: McDonald’s is testing a retail media network on menu screens
