Biggest retail trend next year? Connected commerce media
Opinion
Brands must reach consumers with their products and services at every possible stage of the buying process, driven by stronger collaboration, an increasing focus on first-party data and evolving regulations.
2024 has seen an explosion in investment in retail media, so brands have left their mark on the retail industry like never before this year. And sometimes quite literally, with Tesco now offering marketers the opportunity to wrap the entirety of a superstore in a brand’s advertising decal.
But while retail media’s financial value continues to expand — with UK spend set to rise to £6.62bn, potentially even outstripping TV advertising by the end of 2025 — brands now need to be thinking beyond retail media alone.
Retail media targets people already within the retailer’s ecosystem, influencing shoppers either on the digital shelf or in store. Admittedly, this can be at a large scale; look at Amazon’s weekly reach, for example. But brands need an even wider reach than this to grow.
Traditional media targets growth audiences of non-buyers or light buyers brilliantly. But there’s a gap — and a time lag — to conversion. Brands need something to bridge the gap between traditional, awareness-building media and retail media networks.
Enter connected commerce media.
A connected customer journey
When we talk about retail media networks, we’re typically talking about specific retailers and the media touchpoints within their own ecosystem — signage outside a store or screens in store, for example. Retail media is still often seen as a separate media buy from digital and social.
However, as the market matures, we need to reframe the way we think about retail media networks, instead considering the term “connected commerce media” — the practice of connecting consumers with their products and services at every possible stage of the buying process, from discovery to purchase, whatever platform that might be on.
Brands must find the relevant touchpoints that exist outside the retailer media ecosystem that drive purchase and connect up the entire experience. Retail media forms just one part of a holistic, connected commerce media strategy.
There are several things driving this shift. One is the vast opportunity for collaboration between retailers, media networks and brands to ensure a joined-up, omnichannel, highly creative and exciting experience for consumers across the whole shopping journey.
Second is data — and, more specifically, first-party data, which forms the cornerstone of a connected commerce media strategy. As cookies fade away, brands are increasingly looking to leverage retailers’ first-party data and use any other sources of future-proofed information to connect up customers’ journeys. This way, they can make sure we’re reaching the right people, at the right time, in the right place, with personalised content that leads to more efficient conversion.
This doesn’t have to be a trailblazing stab in the dark, either. A key reason behind Marks & Spencer’s strong recent growth is its data-driven, dynamic website. Yes, it has overhauled its clothing, but the business has also been harnessing first-party data points to recognise individual shoppers on its site and target them with content that supercharges engagement and conversions.
The third is shifting regulations. As rules for advertising around foods high in fat, salt or sugar come into play next year, FMCG brands are having to shift investment outside TV to engage consumers during the day. Earlier this year, Mondelez International confirmed that retail media will be its number one way of talking to shoppers during the daylight hours. When up to 85% of customers are making choices while they’re shopping, being present in store ecosystems is a way to mitigate, and even defy, those restrictions.
Fuelling greater creativity in commerce
Connecting up media will provide a rejuvenated sense of creativity and innovation — for advertisers and retailers. There is huge scope for connected commerce media to form part of a brand and performance campaign, rather than simply being a bottom-of-the-funnel tactical conversion.
A great example is Boots, which has recently levelled up its partnership with ITV Media to include Love Island product placement, a co-branded This Morning bus and trialling of addressable advertising. These steps help to push more people towards the Boots retail media ecosystem and into loyalty programmes, CRM systems and post-purchase sign-ups, while injecting some fun and creativity into the outreach.
In addition, as retail media platforms mature, we start to see more live-streaming and dynamic audiovisual content to tempt consumers into the ecosystems and spend time there. This will marry up with the sort of creative content brands want to produce, fuelling a more connected experience across the board.
People only need to look to China to see how live-stream shopping has transformed the commerce experience because of the rich brand-building opportunities it provides. In the West, we’re seeing Amazon implementing similar services, from a Live Deals streaming channel to audio ads integrated into its Alexa virtual assistant.
To be effective, however, it is crucial that the connected commerce approach plays into the overall comms strategy, from both a creative and media perspective. How does connected commerce media complement the investments being made in traditional media and retail media?
It’s very easy for these elements to become divorced, especially if brands are fragmenting some activities between in-house capabilities or via “specialist” agencies. And so this shift will require a reframing of all activities to ensure connected commerce is appropriately built in as standard.
Creative commerce in action
We’re already seeing an example of connected commerce in action in influencer commerce — creators on social platforms are driving people to retail platforms and making their content shoppable. I anticipate we will start to see retailers using influencers to really start to grow some of their categories and bring even more people into their ecosystems.
Social commerce, of course, already gets a lot of investment, but we’ll see another shift in 2025, when brands are going to look to join up social and retail media so they understand exactly what their influencer spend, social spend and digital spend are delivering in terms of conversion. This could result in influencers having their own shop fronts but for specific retailers, for example, like they do on TikTok Shop already.
Ultimately, the rise in connected commerce media will facilitate brands better meeting their customers where they already are. Whether that person purchases through social commerce channels, direct-to-consumer or is linked into a retailer’s ecosystem.
Mars has set a brilliant example of this in its partnership with Tripadvisor to enhance Cesar and launch a co-branded digital hub that connects pet parents with the best pet-friendly travel experiences. This exemplifies a brand creating new platforms to enhance its product delivery across new touchpoints.
Who assumes the connected commerce media mantle?
Many agencies still don’t have the expertise or understanding of the full retail media or connected commerce ecosystems.
Next year, we’re likely to see more agencies nurturing this capability, particularly as media networks grow, customer behaviours change and shoppable platforms evolve and increase. These things will spur brands to invest more into their connected commerce media.
It’s now up to agencies — the brand partners in innovation and growth — to try to stay ahead.
Michelle Whelan is chief client officer at VML