Retail Media Network Basics At A Glance

No one can deny or ignore retail media’s impact and influence in the commerce marketing industry these last few years. However, retail media wasn’t always easy to define — and the meaning can still be fuzzy to some. Who can blame them, though? At P2PI alone, as the first to cover the space in depth, we've referred to retailer media networks as "retail digital media platforms" as well as "retailer ad platforms" when we first started hearing and reporting about it, and “retail media” was loosely used elsewhere. (Read P2PI’s Early Coverage of Retail Media: 2020 Trends in Retail Media and Mastering Ad Platforms)

Retailer Media Network Definition 

Thanks in part to our Commerce Executive Network sharegroup many years ago, we've come to define retailer media networks as an advertising platform owned by a retailer that allows brands to advertise on the retailer's owned and/or operated channels — as well as offsite and other channels — leveraging the retailer's first-party data to target its unique shoppers. However, there are key, third-party partners that have media networks within a retail environment that are not owned by any one retailer, which we distinguish as retail media networks. 

Retailers are not the only companies riding the retail media wave and creating ad businesses. Financial media networks are advertising platforms that leverage financial institutions' proprietary data to target personalized ads to customers.

Retail Advertising Measurement Terms

As measurement continues to be such a hot topic, key terms to know include:

• Return on Ad Spend (ROAS): Measures the amount of revenue earned for every dollar spent on advertising. Calculated by dividing revenue generated from ads by ad spend (multiplied by 100 to get a percentage). ROAS looks at revenue rather than profit and only considers the direct spend. It is similar to return on investment (ROI) but, while ROI looks at overall investment, including people, tools and other expenses, ROAS only looks at the marketing spend with the platforms to calculate campaign performance.
• Click-Through Rate: Looks at the number of times an ad is clicked on. The percentage is calculated by the number of clicks that an ad receives divided by the number of times the ad is shown: clicks ÷ impressions x 100 = CTR.
• Cost Per Mille (CPM): Average cost of 1,000 ad impressions or the cost an advertiser pays for 1,000 views of an ad. Also called cost per thousand, which is “mille” in Latin.
• Conversion Rate: Percentage of visitors or leads who completed a desired action. Calculated by the number of conversions ÷ number of visitors x 100 = conversion rate. 
• Impressions: Typically denotes the number of times an ad was displayed or had potential eyeballs on it.
• Share of Voice: Percentage of media spending by a company compared to the total media expenditure for its product or service categories in the marketplace. In other words, it refers to the company’s share of advertising/marketing compared with its competitors.