Convenience Stores Hold an Advantage in Retail Media Network Space
NATIONAL REPORT — Loyalty programs. Online ordering. Mobile apps. Convenience store operators are always looking for the next big technology initiative to drive customer engagement. Now, the new frontier may very well be retail media networks (RMNs).
Retailers and consumer packaged goods (CPG) companies across all channels have always found ways to connect with their loyal shoppers — and just as importantly, build connections with new customers — via billboards, television, radio and, of late, digitally as everyday screen times increase. But their reach doesn't need to end there as seen with the growth of RMNs.
[Read more: Leveraging the Forecourt to Drive Impulse Sales]
A retail media network is like an asset, according to Susie Opare-Abetia, founder and CEO of Wovenmedia, an in-store retail media solutions provider based in San Francisco. A RMN could take the form of a retailer's website, mobile app or email channel, or it could be the store itself. With a retail media network, retailers are essentially opening up that asset to allow ads to be published, leveraging their first-party data to get the right ad in front of the right consumer.
If you think RMNs are growing in the convenience channel, you are not mistaken. In the fall of 2022, 7-Eleven Inc. ventured into the space with the launch of Gulp Media Network. Aimed at fulfilling immediate-consumption purchase occasions vs. stock-up trips, Gulp Media taps into the Irving, Texas-based retailer's customer data — which is 90 million loyalty members strong, or approximately one in four Americans — to transform the customer experience.
Ankeny, Iowa-based Casey's General Stores Inc. made its foray into RMNs with Casey's Access, which went live in the first half of 2023. Casey's Access creates opportunities for brands to leverage the company's scale and new capabilities.
Earlier this year, Pennsylvania-based Wawa Inc. debuted the Goose Media Network to connect its customers with its partner brands through custom ads and campaigns across a variety of digital channels. Wawa, which operates approximately 1,050 c-stores, partnered with Publicis Groupe's Publicis Sapient, Epsilon and CitrusAd to bring together their digital business transformation services, retail media expertise and advertising technology platform.
Leveraging the Physical Space
Retail media networks fulfill a brand's need to reach shoppers at the point-of-purchase decision. "These networks are really growing phenomenally in the digital space, the largest being Amazon, simply because of the sheer volume of web traffic that goes to Amazon's website. [RMNs] have a huge percentage of market share in the digital space," Opare-Abetia said.
Brick-and-mortar retailers, however, have taken note and are not ready to cede this technology arena to Amazon or any other digital retailer.
"Retailers are like, 'Well, hold on, wait a minute, we have huge reach in the physical space.' That's why you are hearing more and more about in-store retail media networks as they start to enter the c-store space, like Casey's Access and 7-Eleven's Gulp Media," she explained, noting that Wovenmedia is in talks with smaller convenience channel players that are interested in entering the RMN space as well.
"In-store is the next frontier for retail media and it makes tremendous sense because people are in a buying mode. They're going to the store to buy stuff. They're in that mode of wanting to buy," Opare-Abetia said. "If you can have screens in-store that can engage, those shoppers can essentially do three things: ideally, if the network is built the way it should be, you are driving sales lift, you are driving brand loyalty, [and] you are also improving the shopper experience."
C-stores vs. Grocery Stores
Convenience stores are not the only retail outlets with in-store RMNs. Rooted in big-box stores' desire to boost sales of televisions and the electronics department overall, retailers have been using screens to attract shoppers' eyes for years.
Earlier this year, Keasbey, N.J.-based Wakefern, the nation's largest retailer-owned cooperative with more than 40 members that independently own and operate 360 supermarkets, flipped the switch on Wakefern Media Exchange. Additionally, Pittsburgh-based Giant Eagle Inc. added audio to its retail media network, Leap Media Group.
In a March 2024 column for Path to Purchase, a sister brand of Convenience Store News, Jeffrey Bustos, vice president, measurement, addressability, data center at the Interactive Advertising Bureau, pointed out that while grocery stores have been early adopters, convenience stores are an untapped market, ripe with potential.
According to Bustos, the differentiating factors between c-stores and grocery stores are purchase behavior, product assortment, shopping frequency and data dynamics.
Wovenmedia's Opare-Abetia agrees that the convenience channel is the land of opportunity for retail media networks. Grocery stores have a leg up when it comes to the digital space — consumers order groceries online or use online weekly flyers to prepare grocery lists before they go to the store — but c-stores have the advantage when it comes to the physical space.
"I think convenience stores can really play big in the physical space. There are a few characteristics of c-stores that really lend themselves well to screens in-store," she said. "The first is simply just reach and frequency. 7-Eleven has about 13,000 stores — that's a massive amount of geographic reach. If you are running an ad on screens at 7-Eleven, you're reaching more [geographies] across the country than you would if you were doing the same ad on Walmart's network."
As for frequency, she said, "If you play an ad on a screen in a c-store, you are going to get somebody seeing that ad at least once a week, maybe more than once a week. There's higher ad exposure across the chain."
Add in the immediate-consumption factor and the convenience channel's high-impact footprint, and you have a perfect recipe for getting messages to more consumers through an in-store RMN.
The Data Tells the Story
All that being said, RMNs don't stop once brands get their message in front of a high volume of shoppers. Measurement is becoming more and more important in the industry, and there are several approaches to measuring the effectiveness of these networks.
One approach, which is typically what these networks have done in the past, is to conduct intercept surveys to gather feedback. However, according to Opare-Abetia, CPG brands are not really looking for that type of feedback. "They're looking for more immediate and more obvious measurement metrics," she explained.
Enter, new cutting-edge solutions such as artificial intelligence (AI).
"Now, we're looking at technologies like AI, anonymous cell phone detection, beacons — technologies that can tell a brand that this is the traffic that came in the store and this is the traffic that was around the screen that saw the ad," Opare-Abetia said. "Then, you can look at the sales data. Did it move the needle on sales, and why was that? Was it the time of day? Was it the creative? The test and learn and test again and measure is really going to be more and more important for these RMNs in-store."
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