Making Sense of Retail Media Networks: Q&A with Greg Koerner

Marketing with Retail Media Networks

Retail Media is one of the fastest-growing and most impactful ad marketplaces in the US. Following in the footsteps of Search and Social as digital advertising’s third big wave, it has already established itself as a force that is predicted to eclipse $50 billion in 2023.

Built on a foundation of first-party purchase data, contextually relevant ad experiences and closed-loop reporting, the value of retail media networks has benefited from the ecommerce surge, ongoing depreciation of third-party cookies and privacy policies related to mobile identifiers.

Now we’re seeing retailers expand their offerings and scale from onsite Display and Search to offsite brand-friendly channels like Video, CTV, DOOH and Digital Audio.

However, as this growth materializes and gets more saturated, old tensions are resurfacing; we’re seeing growing frustration in terms of inconsistent offerings, measurement and budget allocations.

To help us make sense of the rise of retail media networks, we sat down with Greg Koerner, a digital marketing pioneer and former Head of Strategic Partnerships and Global Agency Development at Roundel, Target’s retail media arm.

• Can you share a little about your professional background? How you started in digital media and how you eventually found yourself in the middle of the Retail Media evolution?
  
  • GK: I came out of college with the goal of becoming a broadcaster and, instead, fell into the Advertising Marketing business. I did this somewhat begrudgingly until I found this thing called the internet and joined a company named DoubleClick. Digital Advertising was in its infancy then, yet we still heard the promises of accurate measurement and culpability for funds invested in an advertising campaign — something that didn’t exist in my world of Print ,TV and Radio to the extent of this new medium. Now, a little over twenty years later, I finally think we’re seeing those promises come to fruition thanks to first-party datasets available via retail media networks and first party data providers.  
    

• You started at Target as a consultant and eventually became Head of Strategic Partnerships and Global Agency Development for Roundel. What were some of the earliest challenges developing their retail media offering? 
  
  • GK: When I got to Target, I found a very robust business that had incredible talent. But it was primarily focused on shopper marketing and shopper marketing budgets. We all knew, based on the general advertising market, that the pools of money of brand dollars are far bigger than shopper marketing dollars, and that the advent of first-party data being brought to the likes of brand managers, ad agency execs and those folks charged with return on investment would benefit the company in terms of revenue far beyond the shopper marketing budgets. So some of the challenges were getting a very successful organization to see there’s a much larger opportunity here—for both the marketers and for Target.  But, we recognized the need to go after it in a much different way. For example, staffing in different places other than Minneapolis (their headquarters) and developing relationships and awareness that wasn’t yet in place.
    
• Were there any challenges with technology, specifically advertising technology?
  
  • GK: A lot of current retail media networks are built, or are currently being built, on complex technology. With that in mind, many networks are only able to process a finite amount of money. As the network generates more revenue and, subsequently, more campaigns are run which in turn involves more measurement and reporting, a strain is put on the technology powering the system. I don’t know anyone who’s not facing these issues. However, problems of scale, if well navigated, are actually a good problem for retailers. So, it’s important to partner with an adtech partner(s) that allows for scale and, internally, to forecast goals, whether for the next six months or coming three years. 

• How did that advent of Offsite Media come about at Target? Was it always part of the plan or just another way to scale first-party data outside of Target.com?
  
  • GK: To answer your question simply: yes, the advent of offsite media allowed us to extend scale outside of Target.com. But the offsite media landscape is a little complicated. Aside from Amazon and Walmart, who own vast amounts of content, many retailers are doing what I’d like to call “renting.” Renting allows retailers to scale by going outside of their owned-and-operated arena to procure inventory off site and fulfill campaigns. It actually works really well because the content doesn’t have to be in the retail environment; for example, it could be a news site or a sports site. From what I’ve seen, it actually works better for the campaign if it is outside the retailer’s owned-and-operated arena. At the same time, it’s important to have ad tech prowess that can essentially automate these actions because, with scale at this point, manually running these campaigns would be nearly impossible.

• You mentioned the promise of accurate measurement finally becoming available thanks to retail media networks. Are we truly there?
  
  • GK: Going back to the advent of digital advertising, the question has always been: is accurate measurement a problem we can ever truly solve? We’re so close now with retail media networks to actually provide consistent and accurate measurement reporting. But yes, major challenges remain. For example, many campaigns are coming into infrastructures that were not necessarily built for that size of scale. So in a lot of cases, measurement is being done manually, which means marketers are receiving campaign results in a timeframe that is less than ideal. This is another reason why technology with some form of automation is critical. 

• Lastly, it feels like we’re still in the infancy stage for retail media networks. What are some of the biggest shortcomings and how do you see them evolving over the next five years?
  
  • GK: I think it’s worth going back to the point around retailers trying to build everything themselves or trying to create their own ecosystem so that they can play in this world. That’s a really tough road for new and upcoming retail media networks. With that in mind, I think you’re going to see a lot of activity with retailers partnering certain ad tech partners versus everybody running out and, for example. building their own DSP the way Amazon did. So for retailers, it’s connecting with the right partner that will allow for scale in the field right now, even if you’re currently building your own retail media network, because that could take half a decade.