Out of home: the oldest medium is possibly the most addressable

A lot of retail media is now digital, based around ‘phone usage and targeting people by location, but there are other emerging opportunities, especially around addressable TV, obviously Amazon Prime Video is a huge player, but there are emerging opportunities with other AV and digital channels.

The earliest poster advertising can be traced back to Indian rock art around 4000 BCE. Technology has moved on in the last 6,024 years, but the principles are the same, putting simple relevant messages in relevant locations.

There are around 400,000 sites and screens in Great Britain. They can be bought in multiple ways and there are many specific packages available by location, for example, in shopping centres. 70.2 per cent of adults see a digital screen in a week, 96.9 per cent of people see a static poster, so the reach is pretty universal.

There is more and more choice, though the process of trading and buying out of home makes addressability more complicated. Although people in the industry may push back, it’s difficult to buy high quality sites short term in specific locations. Programmatic has created opportunities and short cuts, but it isn’t infallible, and the ease of access doesn’t always justify the loss of control.

Addressable out of home doesn’t have to be some complex invisible digital channel served programmatically. London Lites is a digital poster contractor with over 40 sites in affluent, shopping areas in the capital. This is an addressable channel, it can be accessed ‘programmatically,’ targeted by location to drive awareness to affluent customers close to shops, messaging can be dynamically changed, it can be augmented with other addressable or locational channels.

Our view is that out of home is a brilliant support medium for other addressable channels, establishing the link between awareness and location. Evidence of payback as a solus medium is difficult to establish, but we believe OOH it is an integral part of the mix to amplify other channels but usually needs to run in conjunction rather than as a solus medium, with location targeted digital display or social media or even addressable TV. It is the most addressable medium because it can be targeted by precise location, in conjunction with other channels.

The fastest growing channel in the world in terms of media expenditure is Retail Media. Instore static and digital advertising is forecast to be the fastest growing area of UK commercial media. Obviously, this is all highly addressable.

The Financial Times/eMarketer predicted that US Retail Media was worth $40 billion in 2022 and is growing at more than 20% per annum.

However, there are a number of issues to address:

Firstly, are significant budgets shifting in the UK? There is a lot of conference and LinkedIn self-aggrandisement, but no real body of case studies where a brand has developed an integrated strategy using addressable and retail media channels to drive a significant shift in performance.

There will be the inevitable land grab by consultants and agencies and a lot of wasted money before we reach some conclusion. The issue is commentators and planners are focussing on channels rather than consumers. Forecasters are looking at the success of Amazon who make $31 billion from selling advertising and hoping other platforms will develop like this. So far, Amazon is a one-off closed loop marketplace and it’s been a long haul, over ten years of weighty investment.

Our view is that successful Retail Media strategies should be centred on customers, not channels. Analysis and profiling of first party consumer data allows targeting of addressable advertising across the whole customer journey, so that reaching a potential customer instore is just the final part of a contact strategy.

All successful media strategies are based on consumer insight and same discipline needs to be applied to the emerging Retail Media marketplace. Currently the focus is on execution and channel deployment rather than audience insight.

Secondly, geography matters. Consumer behaviour varies massively across the nation; economic circumstance is a huge variable but also whether a store is urban or suburban or in an area with a broad ethnic mix or a highly competitive, high-profile location, people travel further to Westfield in Shepherd’s Bush than Kew Retail Park. That said, most shops are parts of local communities and retail media strategies need to reflect this. We help clients analyse store portfolios against the proximity of key audiences they need to reach. There will be locations that require greater investment than others, this needs to be built into the targeting strategy.

The growth of Retail Media has largely been an American phenonium, physical retail is still huge in the US, whilst e-commerce in the UK is twice as large as a proportion of total retail sales (36.3 per cent versus 16 per cent in the USA.) Given the dominance of digital tech in the ‘States and the fragmentation of TV platforms, there has been huge growth in connected TV as a Retail Media channel to drive instore sales. This has yet to happen in the UK beyond Amazon Prime Video.

Roundel Media is the self-serve platform for Target (which has 1,900 US stores) and delivers access to all digital channels, including AV, from one self-serve platform. They claim 91% of Target guests subscribe to a streaming service​.

The UK isn’t close to this, possibly because the size of the prize isn’t as great. Target has 165 million guests or customers, creating a huge potential advertising marketplace, in comparison Tesco Clubcard has around 20 million members, obviously massive but not on the same scale.

There are opportunities in the UK, FMCG brands can target Sainsbury’s customers using Nectar 360 data on Channel 4’s All 4, their streaming channel. Dunnhumby, Tesco’s retail media and data partner, can combine Tesco Clubcard data with Google, Meta, Pinterest, The Trade Desk, ITV, Channel 4 and Sky datasets, to deliver multi layered, precision targeting that can be evaluated beyond the Tesco Retail Media ecosystem across search, social and TV platforms, Live Ramp and Sky Media.

However, we’ve not yet seen zeitgeist shifting campaigns, where a brand has changed its performance using an addressable, data driven strategy using retailer data. They may exist and not been published, or the UK market isn’t quite ready.   

That said, the opportunity is massive but requires a different mindset. Allowing brands to target known consumers via high quality retail channels across the whole purchase cycle is exciting. But it will require a coalition of disciplines and technologies that currently don’t naturally sit well together nor share similar agendas. Shopper media campaigns are often judged on driving immediate response, whereas awareness shifting advertising is judged over longer periods with ‘softer’ measurement criteria. There has to a common currency to enable this.

The IPA, the advertising trade body, recently ran a seminar on retail media and social commerce, so maybe there is a shift and evidence that the advertising industry is taking Retail Media seriously.



Agency structures don’t make linking above the line and retail media easy and there are often different budget holders at clients, digital technology and single sources of data will probably be the game changer.