IAB Releases Retail Media Measurement Guidelines in Conjunction with MRC to Help the Industry Maximize Growth Potential
New York – September 13, 2023 – Retail Media was one of the fastest growing U.S. advertising channels in 2022, according to a new report by the Interactive Advertising Bureau (IAB) titled “Retail Media 2023: Operational Strategies to Meet the Growth Potential.”
“It’s a sea change in how the biggest advertisers are planning to reach customers,“ said Jeffrey Bustos, VP, Measurement, Addressability, Data Center, IAB. “Retailers have a treasure trove of first-party data that enables advertisers to reach high intent audiences and provide closed loop-measurement, and budgets are shifting accordingly.”
The study, released today at the IAB Connected Commerce Summit: Retail Reimagined, was created in partnership with BWG Strategy, and surveyed 200 RMN ad buyers at brands and agencies, as well as conducted over 30 interviews with senior decision-makers at retailers, brands, agencies, and intermediaries, including demand side platforms (DSPs), supply side platforms (SSPs), and data providers.
“At IAB we have a unique perspective given our experience over the past three decades of digital development, and the ecosystem-wide impact that RMNs are having,” said David Cohen, CEO, IAB. “In some ways, we are reliving the formative years of the ad-supported internet and developing solutions for brands, buyers, ad tech and retailers to grow their businesses responsibly. We can, and are, helping RMNs realize their full potential which is very gratifying.”
Key Findings: Greater Growth Ahead
RMN ad buyers are projected to increase spend by 11% year-over-year in 2023. These are defined as buyers at brands and agencies spending at least $5M on RMNs annually.
- Among those increasing spending on RMNs, investments are expected to rise by nearly 20%.
- Top reasons to buy: reach incremental audiences (55%); leverage retailer first-party data (52%); drive performance (48%); and leverage customer data (45%).
- The Endemic Brand “Spend Tax” Grievance is a myth. Only 28% of buyers cite the requirement to spend as a top reason for buying.
- To fund increased RMN investment, more than half (52%) are reallocating funds from across digital platforms, including social, search, and digital video/CTV while more than one-third (36%) are reallocating funds from linear TV, print and out-of-home.
- Cross-RMN measurement standards and transparency around attribution windows, incrementality, and viewability, for consistent RMN comparisons will significantly help propel ad spend.
Key Findings: Areas of Opportunity
- Retail media can grow even faster, but must first address key ecosystem-wide issues.
- Improving measurement and data collection is the #1 opportunity area identified by buyers.
- Over two-thirds of RMN ad buyers (69%) cited the need to resolve complexity in the buying process. While many RMNs operate in silos and lack automated buying and cross-RMN performance capabilities, some have begun to provide self-service and managed-service activation platforms. Private marketplaces (PMPs) have also begun to emerge.
- Nearly 2-in-3 buyers (62%) cited the lack of measurement standards as a top challenge to continued growth, followed by nearly 60% wanting greater transparency.
- 60% of ad buyers want better collaboration and communication with RMNs. Tellingly, only one in ten (12%) ad buyers are “very satisfied” with their RMN partner relationships and communication.
“Everyone notes a lack of alignment of stakeholders across shopper marketing, performance marketing, brand marketing and beyond” said Jeffrey Bustos, VP, Measurement, Addressability, Data Center, IAB. “There’s a big opportunity for brands to leap ahead of their competition if they do the work to align everyone’s interests and provide a unified point of view and clarity around goals.”
Click here to download “Retail Media 2023: Operational Strategies to Meet the Growth Potential” study.
IAB/MRC Release Retail Media Measurement Guidelines for Public Comment
As found in the IAB Retail Media Network study, there is a lack of consistent measurement across different RMNs that has emerged as a significant challenge.
The wide array of retailer offerings and metrics has led to difficulties in evaluating campaign performance across platforms. The industry is actively addressing this issue, with IAB and Media Rating Council (MRC) working together to establish measurement guidelines through cross-industry collaboration. The working group’s guidelines will be presented for public comment at the IAB Connected Commerce Summit: Retail Reimagined on September 13, 2023, and will be open for 30 days until October 13, 2023.
“Everything we’ve learned in this study points to the fact that the continued growth and success of retail media hinge on achieving measurement standardization,” said Bustos. “That’s why IAB and MRC are working together to identify existing standards, define common metrics, and create guidelines to ensure consistent measurement across platforms, promoting transparency and confidence in retail media investment.”
IAB and MRC developed retail media measurement guidelines, covering numerous aspects including audience measurement, in-store digital placed-based measurements, ad delivery, viewability, incrementality, reporting, and transparency. This methodical approach ensures all key areas are addressed to achieve comprehensive standardization.
To review the IAB/MRC Retail Media Measurement Guidelines and provide feedback, visit http://iab.com/retailmeasurement.
The Interactive Advertising Bureau empowers the media and marketing industries to thrive in the digital economy. Its membership comprises more than 700 leading media companies, brands, agencies, and the technology firms responsible for selling, delivering, and optimizing digital ad marketing campaigns. The trade group fields critical research on interactive advertising, while also educating brands, agencies, and the wider business community on the importance of digital marketing. In affiliation with the IAB Tech Lab, IAB develops technical standards and solutions. IAB is committed to professional development and elevating the knowledge, skills, expertise, and diversity of the workforce across the industry. Through the work of its public policy office in Washington, D.C., the trade association advocates for its members and promotes the value of the interactive advertising industry to legislators and policymakers. Founded in 1996, IAB is headquartered in New York City.