Retail Media Networks are one of the hottest channels in advertising as retail giants like Walmart, CVS, Target, Kroger and, of course, Amazon make mountains of consumer purchase data accessible to marketers to target customers on the retailer’s digital platforms. How does radio tap into the expanding pool of RMN dollars, which are forecast to reach $61.15 billion by 2024, making up nearly 20% of digital ad spending? By showing marketers how radio’s upper funnel prowess complements RMN’s performance marketing capabilities. And by melding first party data on radio listeners with the retail network’s treasure trove of purchase data.
Advertisers mainly see the 70-plus RMNs as a lower-funnel tactic in the path to purchase and as a way to drive sales, according to the ANA’s 2023 report on retail media networks. They’re not known for their mid- and upper-funnel ability, which is where radio comes in.
“Radio — known as a medium that can drive brand lift and increase traffic to websites and stores — is a proven performance marketing channel capable of reaching consumers as they move through their daily routines and the path to purchase,” Tammy Greenberg, Senior VP/Business Development at the Radio Advertising Bureau, writes in a “Radio Matters Blog” post. “The synergies and amplification that radio can bring to RMN plans have the potential to multiply results and ROI by filling gaps at the middle and top of the marketing funnel while supporting lower-funnel activity.”
The strategy espoused by Greenberg is that radio’s “superior reach” can be used by brands to fill their upper funnel gaps. Citing a recent Nielsen Canada study for a CPG brand released by Radio Connects, Greenberg said having radio in the media plan boosted the sales effect of retail trade promotion by 2.6% while also lifting all other tactics used by the brand, including television, out of home, social, search, and display. “Reaching and engaging consumers throughout their day reminds people of the messaging they may have received via their preferred retailer and kept tucked away in the back of their brains, which can inform their actions later on,” Greenberg writes.
The other way RMNs can harmonize with radio revolves around data. According to RAB estimates, nearly every one of the more than 15,000 radio stations in the U.S. owns proprietary, first-party data that captures audience preferences, passions, and demographics. While the insights derived from the data are used by advertising partners “to generate participation in promotions, serve timely and localized messaging, enhance couponing efforts, and to seed various branding messages,” there are other applications.
Large scale audio players can get in on the retail media action by integrating their own first party data, in a privacy-protected way, with that of the retailer to help advertisers find their audiences. Nicole Perrin, VP of business intelligence at Advertiser Perceptions sees an opportunity for radio by following the cue of media companies on other channels. Roku, for example, partnered with grocery store giant Kroger to share first party data so advertisers can target the appropriate audience on its streaming video platform. Integrating with Kroger’s data enables Roku to show the advertiser insights about what happened after the ads ran.
“There’s all of this retailer data that helps advertisers target … ads,” Perrin told Inside Radio in a recent article. “Radio or digital audio companies would have the same potential there to find retailers to partner with in some type of a data co-op situation… Data clean rooms are a technological venue where this sort of thing could happen.”
Marketers have used radio and the larger audio space for decades to connect with consumers on the go or looking for some me-time. “With the power of radio’s social influencers and its integration with streaming platforms and podcasts, the complementary effectiveness of audio and RMNs is a win-win for marketers,” Greenberg concludes.