A competitive edge in Retail Digital Media starts with data

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So far, we’ve established the increasing importance of Retail Digital Media (RDM) as a vehicle to create a competitive advantage for both eRetailers and manufacturers looking to grow their online sales. In this post, we highlight the fundamental role data plays in making Retail Digital Media a powerful sales growth driver, and why brands should consider RDM as “pay-for-performance” advertising in which the purchaser pays only when there are measurable results.

With global eCommerce growth forecasted to nearly double in the next 5 years[1] and eRetailer sites the #1 starting point for product searches[2], eRetailers lay claim over valuable online real estate with which to convert shoppers. However, how do we know if the campaign converted enough shoppers?  Did viewers notice them?  Did the investment payout?  Brands cannot fully understand the effectiveness of their RDM campaigns without clear performance measures and visibility on results.


Assessing the performance of a campaign is crucial
Brands need clear performance measures and visibility on results


Successful RDM campaigns are founded on a measurement framework focused on metrics that are relevant for achieving the brand strategy, and a tracking plan that is pre-aligned with the Retailer.  The discussions on performance measurement is an iterative process that starts well before working on the details of the plan such as placements or formats, and end up after the campaign when reviewing the results.


Joint business plans

It all begins with the Joint Business Plan (JBP) between the sales team and the eRetailer, during which the business goals and the key performance indicators that will track the success of RDM activations are defined. It is defined according to the brand strategy and opportunity at the eRetailer, but also according to what the brand wants to learn given that RDM is a great opportunity to better understand  shopper behaviours. After these points have been discussed, the yearly RDM investment can be agreed between the eRetailer and the Brand.


Buy types

Then before each campaign, the brand and the eRetailer should align on buy types and planning forecast. There are many buy types possible, such as the number of clicks, impressions, or a guaranteed minimum online sales. The choice of the buy type is a strategic decision made according to the goal of each campaign and according to the performance data that the eRetailer is able to track and report. Even at basic eRetailers, brands can buy media based on a certain number of online sales; in that case, the eRetailer will increase impressions at no additional cost if the goal was not reached as expected during the campaign. At a minimum, the brand team should get from the eRetailer a forecast for number of impressions, a cost per impression (CPM), along with a benchmark of click through rate (CTR) and cost per click (CPC).  Once the eRetailer and the Brand have agreed the basics of performance measurement, the work on the detailed Retail Digital Media plan can be finalized with the exact selection of formats and placements, along with the planning forecast and buying commitments behind each of them.


Post analysis

The end of the campaign should be followed by a post analysis to assess the compliance of the plan that has been delivered and its performance. The actuals achieved are compared to the initial commitment. For instance, impressions achieved should be compared to the forecast.  If the actuals are below what was agreed with the eRetailer, the eRetailer should make up the difference. Then, KPIs (such as ROAS) should be calculated for the campaign as well as for each tool. This allows the team to assess the overall performance of the campaign versus the initial business goals, but also the contribution of each of the tools. The campaign results should always be discussed with the eRetailer, and serve as the basis for future negotiations and to optimize future plans.


Data tracking
The end of the campaign should be followed by a post analysis to assess the compliance of the plan that has been delivered and its performance.


Overall, using data tracking to optimize and improve future executions is a hallmark of an effective RDM strategy.  Without it, the brand is blind to the drivers of its sales.  If the eRetailer is hesitant about data sharing, either apply a “test and learn” approach that can be positioned to gain a competitive advantage on both sides, or position data sharing as a prerequisite to any RDM investment. Nowadays, eRetailers are more sophisticated than ever at collecting data, and most track at the very least the most basic metrics such as impressions achieved, click through rate and online sales.  Many can even go far beyond that, calculating metrics such as return on advertising spend.


If there is one driver of RDM excellence, it is the mastery of data. It allows brands to determine if the RDM campaign was a success, if it needs further refinement to deliver a higher ROI, and what to negotiate with the eRetailer in the future.  Measurement and optimization is an iterative process that, if done properly, can reap tremendous rewards for the business.


Authors: Niloo Farmand, Alexia André


At the e-business institute we have been studying the Retailer Digital Media space since 2015.  Get in touch to know more and leverage this opportunity as a competitive advantage for your company.



[1], “Retail e-commerce sales worldwide from 2014 to 2021 (in billions of US dollars);

[2] Bloomreach study, US market, September 2016


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