Rajesh Verma, General Manager of Epsilon talks to Communicate about the new trends of retail such as offsite media, CTV and predictive and generative AI.
Retailers are starting to explore offsite media and form partnerships with non-endemic brands. Can you elaborate more on this trend and how it works for brands?
Onsite retail media is just scratching the surface – offsite media is where the real growth lies. By using retailer audience data, endemic brands activate campaigns outside the retailer’s ecosystem, but partnerships with non-endemic brands open up an even bigger playing field. Nearly 90% of untapped retail media opportunity lies here.
Take, for instance, a car brand targeting parents shopping for prams. Using retailer data, they can deliver highly relevant ads promoting family vehicles. Everyone benefits – the retailer boosts revenue while gaining valuable customer insights, and the advertiser reaches a hard-to-find audience segment that traditional channels miss.
What makes it even more powerful is the ability to track outcomes. Advanced tools measure results like website visits or even showroom footfall, proving the value of the investment. When executed thoughtfully, offsite media and non-endemic partnerships deliver measurable wins for both brands and retailers.
Formats like Connected TV (CTV) and on-demand streaming services are certainly on the rise. How can these formats work in tandem with a more classical approach?
Connected TV and on-demand streaming are gaining traction, offering brands exciting new ways to extend their reach. These formats aren’t here to replace traditional methods but to complement them. In regions like the Middle East, where adoption is still growing, there’s immense potential for early adopters to set the pace.
The focus should be on cross-device accuracy, ensuring consistent messaging across screens. For instance, collaborations like Samsung’s with MBC Media Solutions hint at the potential of integrating CTV into a single customer view.
Long-term, CTV can complement classical approaches by delivering precise targeting and wider reach. For now, it’s about experimenting and building capabilities to make this a seamless part of the media mix.
Predictive and generative AI will transform how brands target consumers and create ads. How can this nascent technology be harnessed to optimise campaigns?
Predictive and generative AI are reshaping marketing, but their success depends on execution. Predictive AI is a technology we have been actively developing and deploying for many years now. It uses historical data to refine targeting and optimise campaigns. It ensures brands deliver the right message, to the right person, at the right time, improving ROI while cutting waste.
Generative AI adds creative firepower, enabling brands to produce personalised visuals or recommendations at scale. While exciting, it’s still emerging and sadly often overhyped. The real magic happens when you combine predictive and generative AI – letting one handle the targeting while the other takes care of tailored content.
The foundation for both? First-party data. Without a robust data strategy, neither predictive nor generative AI can reach its full potential. Brands should prioritize predictive AI now for immediate impact while preparing to harness generative AI’s creative possibilities in the near future.
Retailers are tapping into digital in-store advertising to capitalise on foot traffic, which is obviously positive but might also be seen as intrusive. Where is the right balance?
Digital in-store advertising has massive potential, but it needs a delicate touch. When done well, it enriches the shopping experience. When overdone, it can feel intrusive and alienate customers. The key is personalisation that’s thoughtful and unobtrusive.
For instance, placing targeted ads in relevant aisles – like promoting baby wipes in the baby-care section – makes the content feel useful rather than distracting. Placement and frequency are critical; too many screens or overly loud ads can create a negative experience.
Non-endemic advertising is an intriguing avenue to explore, as it can diversify the content, but it comes with its own challenges, like tracking cross-store purchases or managing data complexities. Retailers may need to partner with external experts to make this work smoothly. Striking the right balance ensures ads enhance the shopping journey without overstepping boundaries.
With the growing complexity of retail media, more retailers will turn to external experts for strategy, technology, and sales support. Is there still a place for in-house agencies?
Absolutely – there’s still a role for in-house agencies, but retail media is intricate and evolving rapidly. In the early stages, external experts are often essential for strategy, technology implementation, and sales support.
Retailers need to deliver on high CPMs, which means providing advertisers with robust analytics and performance insights. Building these capabilities in-house takes time. A smart approach is to partner with external specialists on a revenue-share model initially. As the retail media network grows, retailers can reinvest revenue into building in-house analytics teams and proprietary systems.
This phased approach ensures a solid foundation while gradually reducing dependence on external partners. The goal is to achieve the right mix of external expertise and internal control to support long-term growth.
