Albertsons Companies is sharing its preliminary framework that aims to standardize specifications, methodologies, terminology, and disclosures across retail media networks, according to a newly released whitepaper from the company.
Via its retail media arm, the Albertsons Media Collective, the grocer said that although the retail media industry is booming, there is a lack of standardization, which it says has produced unnecessarily complex, inefficient, and costly ecosystems.
And while retail media networks have many benefits including the ability to deliver highly targeted messaging and offers that better connect with consumers at their point of purchase, the whitepaper finds that there are no universal best practices.
A January study from the Association of National Advertisers reports that a “lack of standardization across platforms’ was the biggest challenge for brands in terms of managing RMNs, with 57% of respondents considering this a big challenge.”
So, what’s the benefit of getting it right? Retail media networks are slated to bring in $106 billion in U.S. ad spending by 2027, according to estimates from eMarketer, a market research company. That’s more than double the $45 billion expected in 2023.
Additionally, the Albertsons whitepaper cites that McKinsey & Company analysis predicts that the potential upside of adopting standards could lead to approximately $5 billion to $15 billion in incremental value across retail media networks, marketers, and agencies in the next three years.
Albertsons media arm first announced the project at the International Festival of Creativity Cannes Lions, during a session alongside leaders from Omnicom Media Group, Pinterest, and R3 on June 22. It will move forward with guidance from an advisory group and will expand with support from the Interactive Advertising Bureau.
The first version of the framework, introduced via the company’s whitepaper, concentrates on four areas: product characteristics, performance measurement, third-party verification, and capabilities. “The framework will be finalized after pressure testing industry-wide priorities and ensuring executional feasibility,” Albertsons said.
Unilever’s Head of U.S. Media Investment and Partnerships Aaron Sobol, supports the initiative saying, “It’s essential for the industry to come together to tackle standardization when it comes to attribution, measurement, frequency of reporting and transparency.”
Grocery retailers have a lot to gain with the standardization of the retail media value chain, but shoppers also stand to benefit from the initiative with more personalized ads based on consumer opt-in data, so they can find products more quickly that align with their needs. In short, it should help shoppers save more time while also discovering new items, the whitepaper states.
SN spoke with Kristi Argyilan, SVP of Retail Media at Albertsons, on the strategy behind the move.
SN: Why now?
Kristi Argyilan: In our current landscape, each retail media network has its own walled garden, which creates challenges for brand advertisers and agencies to work with and understand learnings across multiple retail media networks at the same time. The pain points advertisers are vocalizing — everything from reporting difficulties in cross-platform comparison to lack of measurement transparency and understanding — are preventing the optimization of retail media investments overall.
Standardization is essential for the future of our industry, and the sooner we can come together to solve for this need, the sooner we can collectively reap the benefits. And these benefits should not be overlooked! According to analysis from McKinsey & Company, the potential upside of adopting standards is immense. In an estimated three years, implementation could lead to approximately $5 billion to $15 billion in incremental value across retail media networks, marketers, and agencies.
SN: What is the strategy behind the standardization?
KA: At Cannes Lions, we debuted a preliminary framework to standardize specifications, methodologies, terminology, and disclosures across retail media networks, which is available in our new whitepaper.
Within, the framework proposal encompasses four priority areas: product specifications, performance measurement, third-party verification, and capabilities. Our goal is that these efforts work to reset the current guidelines implemented by retail media stakeholders and ultimately create a more efficient, effective, and prosperous industry for decades to come. For consumers, these benefits will have a massive upside too - with more customized shopping experiences that save them both time and effort.
SN: Who is leading it and what is the ideal end goal?
KA: Albertsons Media Collective is spearheading this work with the launch of our new whitepaper and standardization framework. Kicking this off, our ultimate goal is to encourage the industry and its leaders to come together to drive real change. In its current form, our standardization framework is a proposal, which is intended to be finalized after pressure-testing industry-wide priorities and ensuring executional feasibility. All boats rise with the tide, and for standardization to work, it’s critical we come together to align on the way forward.