‘While some will strike it rich, not all will be lucky in the new retail media gold rush’

Another week, another retail media initiative – two, in fact.

Over recent days, Iceland and Frasers Group are the latest to join the retail media frenzy, as many in the industry seek to exploit a fast-growing and potentially highly profitable revenue stream that complements their core operations.

The frozen food specialist’s move is a relaunch, this time in partnership with specialist agency Gig Retail, which has worked with big names such as Asda.

Iceland aims to offer a “full funnel” service – ie: everything from awareness building to post-purchase – that enables brands to “reach, engage and influence the purchase decisions of a vast audience of over 9 million monthly shoppers, enhancing the customer journey at every touchpoint, from sofa to store”.

“The risk is customers are dished up an endless menu of products and services they didn’t come for and aren’t interested in”

Frasers, whose businesses and brands are very different from grocery, has unveiled Elevate – a name in keeping with its wider strategy. Elevate is a “new data-driven platform [that] offers hyper-personalised advertising across the group’s physical and digital spaces”. It’s being run with partner Zitcha, which works with businesses including Ocado Retail.

The pair joins a swarm of retailers in a gold rush to build media businesses, and all the best to both of them as they prospect for a share of brands’ marketing dollars.

However, the headlong dash into retail media is unlikely to be a rich seam for everyone. Not all will strike lucky.

Such is the scale of activity, with the installation of in-store screens and ad serving on customers’ devices at home, you wonder whether much of it will become the equivalent of muzak or, even worse, a deafening din that serves only as an intrusion.

The risk is that retailers’ customers become commodities themselves, dished up an endless menu of products and services they didn’t come for and aren’t interested in.

While most shoppers love to hear about relevant new products and promotions, they often go to retailers because they value their professional skill in selecting and editing ranges, especially in non-food categories.

Serious players

The point was made by John Lewis boss Peter Ruis at last week’s World Retail Congress. John Lewis has a retail media operation – Ruis flagged the 500 million annual visits to its website as among its appeals – and he wants to grow it.

But he said at its heart, John Lewis “is a brand curator”, so a marketplace approach would be problematic.

He said John Lewis increasingly sees itself as “a proper media platform for the first time” in competition with traditional players such as Sky or The Sunday Times, but with “a very specific set of criteria”.

“Serious investment and data sophistication will be what mark out retail media’s winners”

It was an astute point about the need to be a serious media player. If you look at the leaders in the field, such as Sainsbury’s and Tesco, their retail media arms are not opportunistic landings on a new fad but have been years in the making.

Each, through their loyalty schemes, has access to data offering genuine insight into millions of customers. Tesco, for instance, has long worked with Dunnhumby to better understand and serve its customers and is now doing the same as its retail media arm grows.

In the case of Sainsbury’s, consistent investment in loyalty means it expects to achieve £100m of incremental sales over three years to March 2027 – and it’s already ahead of plan. That’s a figure that is more than, or a substantial proportion of, many retailers’ total sales.

Serious investment and data sophistication will be what mark out retail media’s winners, allowing such players to deliver much better personalisation than weaker competitors and insights that are genuinely insightful.

That’s what brands will look for and, crucially, what customers are most likely to appreciate.