Transcript

You're listening to the Middleman podcast with Tom Limongello So usually at this time of the year, we'll just jump right in, line up a whole bunch of guests and keep moving. And to be clear, we've already done that a bit. We have a couple of episodes that are recorded and those are coming out soon. But last year we had 35 episodes and a lot of them were focused on in store, retail, medium. And after spending time at CES and NRF, it felt like the right moment to slow down and explain for a second how my thinking has changed after seeing those two events back-to-back. That's why I wanted to do a solo episode here. Now, before we get into the episode, I went to both CS and NRFI. Don't know if I recommend that, but I definitely recommend the Stratacache What's in Store event. And a big thank you to Jonathan Rosen for reaching out and letting me do a panel on in store creative. We had Tyler Lusebrink from Ace Hardware, Red Vest Media, we had Mario Mijares from Seven-elevens, Goat Media, and we had Amy Andrews. From marginally commerce and we had a great conversation. All of that will be available on the Stratacache website of the event, so you can go and have a look at that. I also had enough time to make a meme of Mark Williamson after his amazing Team Wolf 2 presentation, and I even had time to high 5 Kerry Masters in person. Just generally a great time. So again, thank you for inviting me. I'm a big fan of getting a chance to get on stage at any of these events, so I hope to do. So this episode we're calling the banded pack. And if you're not from the retail world, a banded pack is when 2 complementary products are bundled together on the shelf. This is not like a family size way to get higher volume of the same products. This is thinking about the use case, soup and crackers or chips and salsa. I once saw Ramen gum, which was my favorite use case where you had soup and then your breath stinks so you need some gum afterwards. Each one works on its own. But together they just sort of click. And that's what CES and NRF were. To me, this year's CES was kind of like the ceiling. It showed me what in store retail media looks like when you have real scale. You saw announcements from Albertsons bringing incrementality to in-store measurement. You heard Walmart talk about incrementality in sponsored search. So just overall retail media getting more mature. It's very much the investor facing story, the CNBC version of retail media. It's proof that the category is growing up, scaling, and starting to adopt more rigorous measurement. And I think that's great. It also raises questions, though. How does this work for shoppers, how the technology should be deployed and how the different answers are for large retailers versus everyone else? NRF. Is a lot messier. If you're not deep into retail, it can feel like a collection of point solutions. There's a lot of hardware, a lot of people talking about software, and it doesn't feel like it's connecting anything. A lot of demos. And for me, this is my first NRF, so it was exciting. But as I walked the floor, especially after coming from CES, I started to see something very different. I saw approaches that weren't trying to replicate what Walmart and Albertsons are doing, and instead we're finding paths that could work for a much broader set of smaller retailers. And that's where I think the banded pack idea really started to make sense. CES is going to show you the ceiling of what's possible at the maturest level, and NRF shows you all these different paths. Now this is where it's important to see where we were. There were two episodes that we had one almost two years ago with Trevor Sumner at Radiant where he talked a lot about brand funded, very bespoke experiences where you built the cabinetry, you had front facing cameras. All of these capabilities were sort of forced onto the vendor and the brand to fund and bring to the store. And then we also had in last April a discussion with Marlow Nickell talking about how they pivoted. Away from a lot of this extra technology that the media buyers weren't really in favor of in the first place. Out to talk about sort of the bespoke capabilities that a brand funds Trevor talked about perfume brands having really exquisite cabinetry and a black box that explained you know when you lifted up a product what you should be thinking about the same thing happens at Dick's Sporting Goods now where you lift up a sneaker and the screen behind it will show you more information about it even Albertsons is now brought that with wine we have an RFID at the bottom of one of the. Models and you lift the bottle on the screen behind it explains more about the varietal or the brand itself. All of those things are great when you are looking for high precision, high intent, bespoke activations to teach somebody about like a new product, but it doesn't really fit in a retail media world where you're running Dr. periods and you want to swap out one brand for the other. Really if we're looking at a world where the retailer funds some of the infrastructure and the brand comes in and rents that space for media, that is really sort of where I think the future will be. I think it's good to listen to how in our episode with Grocery TV, Marlow Nickell talks about how they built out all this technology and then they actually pulled back, not because the technology didn't work, but because the market, media buying market wasn't ready for it. We used to do actually impression and engagement measurements so we could actually see when someone was in front of the screen and whether they were looking at the creative or not, how long they were looking at it. So we could say like, here's exactly how many impressions have been served and how engaging your creative is relative to other creatives. And that was really cool stuff. But the reality is the market wasn't ready for that from a demand standpoint. And there's also just a lot of challenges from a scalability standpoint and a legal standpoint. And so we've really on the other direction got a lot more pragmatic and basically just said, look. Just fundamentally, this is a really good media product. Let's just put great screens in the right parts of the store and, and that alone is really valuable and that's what we've leaned into and focused on. So this was a quick episode. Really I just wanted to focus on the fact that we're moving away from bespoke over instrumented experiences led by brands in store towards things that can actually scale across different types of retailers. One of the themes that's come up for me, including in the conversations like in the panel I did at Stratacache, is that you really have to start with the job to be done. When you're thinking about the creative and what you're trying to put in front of the consumer. In a lot of cases, you don't need a ton of technology to make that work, however. There's also another layer around measurement, sensing, even things like screen quality that I saw at NRF that hasn't been talked about much in retail media yet, especially not in the CES track, largely because it's not ready. But when that is ready. That is going to get us to that next level of in store retail media. Some of that will show up in the upcoming podcast conversations. Some of it will be better handled in more visual written breakdowns alongside of the show. Um, but overall, that's where the tension comes in. The ambition for in store retail media has always been to make it more engaging, more measurable, but it only works if it fits the shopper experience. Even when in store retail media is done really well, it is potentially something that makes the retailer nervous because anything that adds friction can slow down shoppers and actually reduce throughput. So all of us thinking about how dwell time is great and ad engagement, we want to elongate that time. A retailer actually thinks of that as a negative in some cases, especially in the store so. The future of in store retail media is going to be defined by how well we balance that consumer experience with how well we can engage the consumer with new ideas and retail media in the store.