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Developments in Retailer Media

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Developments in Retailer Media

Is the growth in retailer-owned media an opportunity for suppliers to reach shoppers? Or is it just a way for retailers to drive new revenue? Tesco and Asda's new media centres can handle fully integrated campaigns. Which media combination works best for individual products and categories?

Media fragmentation and growth mean that positively affecting consumer decisions is more complex and costly than ever. How can brands maintain share of voice in retailer owned media? Does the integration of Retailer Media Services represent a new opportunity for collaboration with the manufacturer as client?

The “last five metres” is one of the key brand battlegrounds for the future. Many brand decisions are made in-store by shoppers who spend less and less time at home. But is the growth in retailer-owned media an opportunity for suppliers to reach these consumers or will it be the retailer and his brand who benefit most? Is it just a way for retailers to drive new revenue?

“We are hugely, hugely interested in this area because we think it’s going to be one of the biggest sources of new value created in the whole space … from a corporate point of view getting the answers is a huge priority.” (Marketing Director, Supplier)

Two current developments are important: the increasing availability of in-store plasma screens and the appearance of retailer media centres able to handle integrated campaigns. Which media combination works best for individual products and categories?

Plasma screens are the newest retailer media platforms. There are 200 networks in the UK and Tesco have them in over 100 stores. How well is it working? Why do supplier opinions differ so widely? Will plasma screens add value to the shopping experience? How much does the industry understand about the new dynamics of communicating with shoppers who are more concerned with their current shopping mission? Knowledge of shopper dwell time and behaviour in different categories is crucial. Trials have shown that what works best are “call to action” messages. These should be integrated with in-store promotional and NPD activity.

The integration of retailer media by Tesco and Asda in 2004 represents the most significant breakthrough. Co-ordinated campaigns have always been extremely difficult to organise. What adds value for the shopper? Where does the supplier place their media so that the shopper finds it helpful and interesting rather than annoying and irrelevant?

“It’s actually how the things work together that matters and not what each individual one does … it’s about the integration, that’s where you get the benefits.” (Dunnhumby).

A growing number of suppliers are using the services of Asda and Tesco Media Centres. How are they organised and how do they work? How are media agencies adapting to them? Tesco Media Services have run over 30 integrated media campaigns for suppliers like P&G, Colgate Palmolive, Nestle Rowntree, Crookes Healthcare, Kellogg’s, Masterfoods and PepsiCo. Since its inception in March 2004, the Asda Media Centre has worked with 90 suppliers of all types and sizes. What do suppliers think so far?

This report is based upon taped interviews with senior management in major multiple UK retailers, fmcg suppliers, media and advertising agencies and industry consultants.

Published: January 2005

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