The Interactive Advertising Bureau (IAB) has released a preliminary framework to standardize retail media measurement. The framework was developed in collaboration with the Media Rating Council (MRC) as well as 55 companies with a stake in the performance of retail media, including The Mars Agency, Albertsons Media Collective, Google, Unilever U.S., Criteo, Best Buy Ads, Kroger Precision Marketing, Target, Vibenomics and Colgate-Palmolive.
Retail media was one of the fastest-growing U.S. advertising channels in 2022, according to a study by IAB. The study found that retail media network (RMN) ad buyers — defined as buyers at brands or agencies that spend at least $5 million on RMNs annually — are planning to increase their overall ad spend by 11% YoY in 2023. Among those planning to increase spend this year, their retail media investments are expected to increase by 20%. To fund this increase, more than half (52%) of RMN ad buyers are reallocating funds from social, search and digital video/CTV, while more than one-third (36%) are reallocating funds from linear TV, print and out-of-home.
There’s no denying the power and appeal of retail media, but RMN ad buyers also indicated a number of growing pains as this nascent channel develops, with lack of measurement standards topping the list. “In some ways, we are reliving the formative years of the ad-supported internet,” said IAB CEO David Cohen in a statement. The majority of RMN ad buyers (60%) surveyed said they want better collaboration and communication between the various RMNs, of which there are now dozens in the U.S. alone.
“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 Jeffrey Bustos, VP of Measurement, Addressability and Data Center at IAB in a statement. “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.”
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The IAB and MRC’s Retail Media Measurement Guidelines aim to set industry benchmarks and align practices in order to facilitate more transparent and secure cross-platform comparisons. The guidelines focus on four major principles:
- Transparency and consistency, with clear definitions and methodologies so stakeholders can easily compare metrics;
- Accuracy and reliability through the use of robust methodologies and technologies designed to minimize errors and adapt to evolving landscapes;
- Privacy and security so that all activities comply with privacy regulations like GDPR and CCPA and user data is protected; and
- Compliance with industry standards so that retail media buying and selling aligns with best practices already established by MRC, IAB and other industry bodies.
An initial draft of the guidelines is now available for public comment through Oct. 13, 2023. Only feedback from U.S. companies or companies working with U.S. clients within the retail media space will be accepted. Once the public comment period ends, the cross-industry group that developed the guidelines will reconvene to incorporate industry feedback into a final version.
“[Retail media] is a sea change in how the biggest advertisers are planning to reach customers,” said Bustos. “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.
“[But] everyone notes a lack of alignment of stakeholders across shopper marketing, performance marketing, brand marketing and beyond,” Bustos added. “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.”
