RESEARCH

DRIVING ROI IN
RETAIL MEDIA
NETWORKS
AUGUST 2023

1
Study objectives and design

DRIVING ROI IN RETAIL MEDIA NETWORKS

Integral Ad Science (IAS) conducted a survey to understand industry

Consumer Study
perspectives on retail media network advertising. This study provides insight
FIELD DATE into the value and challenges of the rapidly expanding retail media network
March 2023 advertising market for both marketers and consumers, focusing on how
media quality can overcome challenges and maximize KPIs in the space.
PARTICIPATION
n=1669 U.S. retail
In addition to consumer data, this study integrates findings with information
media shoppers
from external B2B studies and observational data analyses to further
understand industry perspectives of retail media network advertising.

DRIVING ROI IN RETAIL MEDIA NETWORKS | 2

RETAIL MEDIA NETWORKS Proportions of advertisers who used
RMNs in the past year
ARE BECOMING A KEY 2022, % of respondents

PILLAR OF ADVERTISING
STRATEGIES
Retail media networks (RMNs) let brands
advertise across a range of digital channels,
placing ads in front of consumers who are in a
shopping mindset.
42% 58%
Did not use Used RMNs
RMNs in the in the past year
More than half of advertisers used RMNs in
past year
their advertising strategies in 2022, and this
number will continue to grow.1

Source: “Retail Media Networks: A Forced Marriage or Perfect Partnership,” ANA, January 2023
DRIVING ROI IN RETAIL MEDIA NETWORKS | 3
1 ”Retail Media Ad Spending Forecast 2022,” eMarketer, August 2022
RMN INVESTMENT RMN ad spend in the U.S., 2019-2024
billions, % change, % digital ad spend
IS THE SECOND FASTEST
ACCELERATING AD $61.2
CATEGORY
$51.4
RMN ad spend is accelerating faster than
any other ad category other than CTV, 57.3% $40.8
and is expected to grow nearly 26%
year-over-year to exceed $51 billion in $31.1
2023. 49.3%
$20.8 31.4%

25.8
$13.2 19.3%

18.1% 19.1%
14.7% 16.4%
13.6%
10.0%

2019 2020 2021 2022 2023 2024

RMN ad spend % change % of digital ad spending

Source: “Retail Media Ad Spending Forecast 2022,” eMarketer, August 2022 DRIVING ROI IN RETAIL MEDIA NETWORKS | 4
RMN AD SPEND IS Internet users’ expected change in
shopping on RMNs over the next 12 months
FOLLOWING CONSUMER % of respondents

SHOPPING HABITS
98% of U.S. internet users shopped on 71%
RMNs in the past 12 months — and this
behavior isn’t slowing down.

98%
of U.S. internet users
9%
20%

shopped on RMNs in the

past 12 months. Less shopping on
retail platforms
About the same
amount of shopping
More shopping on
retail platforms
on retail platforms

Q. The following is a list of retail platforms. Which of the following have you used for online shopping over the past 12 months?;
DRIVING ROI IN RETAIL MEDIA NETWORKS | 5
Compared to last year, how much shopping on online retail platforms do you plan to do over the next 12 months?
AS CONSUMERS RMN retail sales in the U.S., 2020-2025
March 2022; trillions, % change, % RMN sales
CONTINUE TO SHOP, RMN
SALES WILL INCREASE TO $1.4
$1.2 TRILLION IN 2023 $1.3
$1.2
RMN sales are expected to continue to $1.1
grow over the next few years, taking an $1.0
increasingly larger slice of overall retail $0.8
sales.
36.4%

17.8% 18.4%
15.8% 17.1%
14.7%

14.6% 14.6% 11.1% 11.3%

9.6% 10.5%

2021 2021 2021 2021 2021 2021

RMN retail sales % change % of total retail sales

Source: “US Retail Ecommerce Sales, 2020-2026,” eMarketer, November 2022 DRIVING ROI IN RETAIL MEDIA NETWORKS | 6
RMN ADS ARE HIGHLY EFFECTIVE AT CAPTURING CONSUMERS’
ATTENTION AND MOTIVATING PURCHASE DECISIONS

ATTENTION PURCHASES CLICKS

89% 86% 48%

of RMN shoppers pay
attention to at least one
of RMN shoppers purchased
a product from a retail media
of RMN shoppers clicked
on a retail media ad in the
type of retail media ad ad in the last 12 months last 12 months

Q. Which of the following types of ads do you pay the most attention to on retail platforms?; Of the following types of ads, which have led you to products that you
have purchased over the past 12 months on retail platforms?; Over the past 12 months, how have you interacted with ads on retail platforms?
DRIVING ROI IN RETAIL MEDIA NETWORKS | 7
 24% 20%
RETAIL MEDIA ADS
INSPIRE IN-STORE
FOOT TRAFFIC
RMNs can work toward measuring
in-store purchases when determining
the efficacy of RMN ad campaigns. of RMN shoppers visited a of RMN shoppers purchased
store to shop for an an advertised product at an
advertised product in-person store

Q. Over the past 12 months, how have you interacted with ads on retail platforms? DRIVING ROI IN RETAIL MEDIA NETWORKS | 8
RMN SHOPPERS Share of U.S. RMN shoppers paying attention to
and purchasing types of RMN ads
PURCHASE PRODUCTS % of respondents

FROM ADS THEY PAY

Ads for products
ATTENTION TO that are on sale
44%
51%

Ads for best-selling items 44%

Consumers are most likely to pay in the product category
you're browsing 37%
attention to and make purchases from
ads that promote sales, followed by ads Ads suggesting products 41%
that you "may also like” 36%
featuring best selling items.
Ads suggesting products 32%
that "customers also
viewed" 27%
They pay the least attention to and do
Ads for products that are 14% Attention
not purchase products featured in unrelated to the products
you're browsing 15% Purchase
unrelated ads.

Q. Which of the following types of ads do you pay the most attention to on retail platforms? ; Of the following types of ads, which
DRIVING ROI IN RETAIL MEDIA NETWORKS | 9
have led you to products that you have purchased over the past 12 months on retail platforms?
77%
of RMN advertisers agree that
expanding targeting options is the
most important capability RMNs can
offer to deliver an effective campaign

Source: “State of Retail Media,” Path to Purchase Institute in collaboration with Criteo, August 2022 DRIVING ROI IN RETAIL MEDIA NETWORKS | 10
RMN FIRST-PARTY DATA Advertisers’ perceptions of the most important future
opportunities with RMNs
FOR CONSUMER 2023, % of respondents

TARGETING IS LIMITED
56%
BY PRIVACY CONCERNS 51%

66%
of RMN shoppers are
concerned or very concerned
35%

27%
23%

about the privacy of their

data in retail media networks

Leveraging Directly driving Integration of Strengthening Improved retailer

first-party data sales merchandising and overall comms plan relations
marketing at integration
retailer
Source: “Retail Media Networks: A Forced Marriage or Perfect Partnership,” ANA, January 2023 DRIVING ROI IN RETAIL MEDIA NETWORKS | 11
ALMOST HALF OF RMN Share of U.S. RMN shoppers who opt out
of data tracking on RMNs
SHOPPERS HAVE % of respondents

ALREADY OPTED OUT OF

DATA TRACKING 49%

19% 21%

11%

Yes, I have No, but I would like No, and I don’t Unsure
opted out to opt out want to opt out

Q. Do you opt out of data tracking on retail platforms? DRIVING ROI IN RETAIL MEDIA NETWORKS | 12
 39% 20%
CONSUMERS ARE
UNCOMFORTABLE
WITH RMNS USING
THEIR DATA WITHIN
AND OUTSIDE OF of RMN shoppers are not of RMN shoppers are not
RMN PLATFORMS comfortable with RMNs comfortable with RMNs
using any of their data using any of their data
As RMNs expand to offer
outside of their platforms within their platforms
advertising options on external
sites, these consumer privacy
concerns are likely to build.

Q. Which of the following personal information are you comfortable with retail platforms using when serving ads to you within their own platform?; Which
of the following personal information are you comfortable with retail platforms using when serving ads to you on websites outside of their own platform?
DRIVING ROI IN RETAIL MEDIA NETWORKS | 13
CONTEXTUAL Top benefits of contextual targeting reported by
U.S. agency and brand marketers
TARGETING IMPROVES 2022, % of respondents

ROI WITHOUT USING

COOKIES OR PERSONAL Aligns with audience
interests
51%

DATA
Brands and agencies both agree that Improved ROI/ROAS 42%

contextual targeting can align with

Increased ad engagement 35%
audience interests and improve ROI
without invading consumer privacy. Does not require cookies
or personal information
29%

Better creative
personalization
28%

Easy to implement 26%

Increased brand safety 23%

Better measurement 18%

Source: “Cookieless Strategies with a Dash of AI,” Advertiser Perceptions commissioned by StackAdapt, October 2022 DRIVING ROI IN RETAIL MEDIA NETWORKS | 14
38%
of RMN shoppers are likely to purchase
products from ads that are displayed in
relevant contexts on retail platforms

Q. Which of the following statements do you agree with? I am likely to buy products that are displayed in relevant places or
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times on retail platforms
ADVERTISERS Most important KPIs to measure success of RMN
advertising, reported by media experts
MEASURE SUCCESS OF April 2022, % of respondents

RMN CAMPAIGNS WITH

AD COSTS AND Advertising cost of
sales (ACoS)
81%

GENERATED REVENUE Return on ad spending

(RoAS)
81%

Industry experts can measure their Sales/order volume/

56%
revenue
success by comparing overall ad costs
and revenue metrics such as advertising Profit 40%
cost of sales and return on ad spend.
Cost per acquisition (CPA) 39%

Share 26%

Average cost-per-click
(CPC) of media
19%

Cost of goods sold

(COGS)
10%

Media cost CPM 10%

Source: “The State of Retail Media 2022,” Skai and BWG Strategy, April 2022 DRIVING ROI IN RETAIL MEDIA NETWORKS | 16
COMPARED TO Critical challenges that slow growth of RMN
advertising investments, according to media experts
OTHER CHANNELS, April 2022, % of respondents

EXPERTS PERCEIVE
RMN ADVERTISING Poor ROI relative to other
advertising channels
22%

TO HAVE POOR ROI Supply chain issues and specific

retailer fulfillment constraints
21%

Media quality solutions, like viewability Proving incrementality of

19%
investment
measurement, can lift ROI on retail
Selling more D2C
media network campaigns. (Direct-to-consumer) less reliance 11%
on retailers

The challenges of managing so

many retailers
7%

Lack of product assortment for our

desired audience
7%

Missing talent or expertise for the

retail media space
6%

Poor or inconsistent content 5%

Too new, not enough best practices

to maximize investments
3%

Source: “The State of Retail Media 2022,” Skai and BWG Strategy, April 2022 DRIVING ROI IN RETAIL MEDIA NETWORKS | 17
Observational Study

AD VIEWABILITY RAISED CONVERSIONS BY 200%

In an observational analysis of a CPG brand’s Q1 campaign, in-view ads uplifted conversions by 200%.
Observational Study
In View Not In View
METHODOLOGY
Sample: blinded
0.06%

200%
CPG brand’s Q1
2023 data

APPROACH
We compared
conversions and ROI
across viewable and 0.02% conversion lift
not viewable
impressions

0.00%
Conversion
Rate

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Observational Study

AD VIEWABILITY INCREASED ROI BY $2.25

In the same observational analysis, viewability resulted in a 268% lift in ROI, or an additional $2.25
Observational Study return on every dollar spent.

METHODOLOGY
In View Not In View
Sample: blinded

$2.25
CPG brand’s Q1
2023 data
$3.09

APPROACH
We compared
conversions and ROI
across viewable and
return on every
$0.84
not viewable
impressions
dollar
$0.00
ROI

DRIVING ROI IN RETAIL MEDIA NETWORKS | 19

1
KEY TAKEAWAYS
Expected retail

RETAIL MEDIA $1.2T e-commerce sales

in 2023
NETWORKS ARE A
GROWING PLATFORM Expected digital
FOR SHOPPERS AND $51B retail media ad
spend in 2023
ADVERTISERS
RMN platforms will continue to grow as of U.S. internet
consumers ramp up their online shopping
activity. 98% users shopped on
RMNs in the past 12
months

DRIVING ROI IN RETAIL MEDIA NETWORKS | 20

2
KEY TAKEAWAYS
of RMN advertisers agree that

CONTEXTUAL 77% expanding targeting options is

the most important capability
RMNs can offer
TARGETING REACHES
AUDIENCES WITHOUT of RMN shoppers are

PRIVACY CONCERNS 66% concerned or very concerned

about the privacy of their data
in RMNs
RMN advertisers can turn to contextual
targeting to reach consumers without using
personal data, ensuring consumer privacy of RMN shoppers have
and peace of mind. 49% already opted out of data
tracking on RMNs

of media experts say that a leading

29% benefit of contextual targeting is

that it does not require cookies or
personal information

DRIVING ROI IN RETAIL MEDIA NETWORKS | 21

3
KEY TAKEAWAYS

CAPTURING CONSUMER 200% Lift in conversions from ad

viewability for a CPG brand

ATTENTION WITH MEDIA

QUALITY DRIVES RESULTS
Advertisers can implement media quality
$2.25 ROI lift from ad viewability for
a CPG brand

solutions like viewability measurement or

contextual targeting to inspire consumer
purchases and other KPIs.
of media experts agree that
42% contextual targeting
improves ROI/ROAS

of RMN shoppers are likely to

38% purchase products from
contextually relevant ads

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HOW IAS
CAN HELP

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OFFERING TOOLS FOR VERIFYING RETAIL
MEDIA NETWORKS
TRANSPARENCY
● Through Tags and S2S
integrations, IAS provides
third party verification for
Viewability and IVT across
the RMN ecosystem
LIVE
CONSISTENT RESULTS
MEASUREMENT ● We’re exploring applications
for sales lift, multi-touch
● IAS is developing capabilities to
attribution, campaign
help clients compare campaign
overlap analysis, and more
performance between retailers
and other channels
COMING COMING
GET STARTED
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