Why 8 out of 10 Retail Media Initiatives Fail

Despite the promise of retail media, expected to account for up to 35% of retail profits by 2030, a staggering 8 out of 10 initiatives fail. The main reason lies not in retail operations but in the media strategy. Retailers excel at leveraging retail data but struggle with media aspects such as go-to-market strategies, pricing models, and building strategic relationships, which are critical for success.

Another critical factor is the lack of understanding of AI's role in amplifying and scaling retail data. Retailers need to transform all their customers—both in-store and online—into monetizable media audiences. This transformation attracts brands and agencies, which increasingly allocate their ad budgets based on the quality and reach of media audiences. Without leveraging AI fully, retailers miss out on creating high-value, scalable media opportunities that meet advertisers' demands.

Key Issues in Retail Media Initiatives

Inadequate Media Strategy and Execution

Retailers often excel at managing retail operations and leveraging retail data but struggle with executing a robust media strategy. Key issues include:

  • Go-to-Market Strategies: Lacking clear, effective strategies targeting well-defined audiences with compelling value propositions.
  • Pricing Models: Difficulty in developing competitive, flexible pricing models that attract advertisers.
  • Strategic Relationships: Failure to build strong partnerships with brands, agencies, and technology providers.
  • Value Chain Optimization: Ensuring each step in the media value chain adds value for both retailers and advertisers.

Challenges in Building Media Infrastructure

Developing a robust technological infrastructure is essential but challenging:

  • Technology Integration: Need for advanced AI and data analytics platforms to merge online and offline data seamlessly.
  • Scalability: Creating scalable infrastructure to handle large data volumes and support multiple advertisers.
  • Data Privacy and Compliance: Implementing robust data governance frameworks to protect customer data and maintain trust.

Lack of Leadership and Talent

Success in retail media initiatives depends on strong leadership and skilled talent:

  • Leadership Engagement: Requires leaders with clear vision and commitment.
  • Skilled Workforce: Need for teams with expertise in digital marketing, data analytics, and AI.

Misalignment with Business Objectives

Retail media initiatives must align with broader business goals:

  • Clear Transformation Goals: Setting specific, measurable outcomes that align with overall business strategy.
  • Agile Governance: Adopting an agile governance model to address challenges and adapt to changes.

Emphasizing Premiumization

Footprints AI addresses these challenges through premiumization, a strategy highlighted in my previous article, "Premiumization: The Future for Retail Media Networks."

Premiumization involves transforming retail media into a high-value, high-margin business by leveraging advanced data analytics and AI to deliver highly relevant and personalized ads to all customers, beyond mobile apps, registrations and loyalty data.

This AI-driven process creates a sustainable investment argument for any upgrade in the Customer Experience technologies, both in-store and online. An investment that is currently almost impossible to sustain with the existing trade-only low-margin revenues.

Start with Footprints AI Today

Footprints AI operates as a premium private partnership model, co-investing in both software and services to ensure the success of your retail media initiative. We cover all critical aspects of success, enabling you to avoid the high probability of failure. In just 3 months or less, our solutions deliver 10X more scalability, profitability, and time to money.

As a retailer, to BUILD a retail media network means you are facing uncertainties & challenges that are linked to both launching, scaling & monetizing your retail data. Which is totally another type of pain points, beyond your current business model.

Retail media is a media challenge. Don’t let your retail media initiative fail. Partner with Footprints AI and JOIN our innovative solutions to achieve unparalleled success in the retail media landscape.

Contact us today to discover how we can elevate your retail media network.

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