How Retail Media Networks Can Go Beyond O&O With Data Clean Rooms

First-party data activation doesn't have to be limited to owned and operated channels. With the support of Data Clean Rooms, retailers can have their pick of retail media and truly leverage their data to capture top funnel budgets.

We’ve discussed some of the data challenges retail media faces before. While the demise of third-party cookies and the dawn of the privacy-conscious era are considered to be significant setback for the retail industry, large players have already proven the contrary.

Retail giants like Amazon were using in-house Data Clean Rooms (DCRs) to power first-party data collaboration on owned and operated channels (O&O) to better understand their customer’s needs long before the downfall of third-party data. Today, DCRs are the go-to solution for secure data collaboration.

That means brands, retailers and publishers can input their data and match it for activation and attribution purposes without one revealing any personally identifiable information (PII) to the other. Secondly, collaborators can avoid the risks traditionally associated with data collaboration and remain in full control of their respective datasets while still reaping their benefits.

Although the shift to first-party data may have posed a threat to the existence of smaller retailers, the emergence of on-demand DCRs – like those offered by Decentriq – can level the playing field by empowering smaller players to put their consumer data to good use. However, while Retail Media Networks (RMNs) experience unprecedented growth rates, relying on O&Os isn’t enough to gain a secure hold on the market. To remain competitive and take their first-party data even further, it’s crucial for retailers to look beyond O&O and explore opportunities with other publishers.

3 Reasons Why Retailers Need to Offer Targeting Beyond Their O&O

1. To Activate New Audiences

As with any channel, O&O aren’t without their limitations. For instance, smaller retailers are undoubtedly at a disadvantage when it comes to outreach – at least in comparison to their more established counterparts. As you probably already know, marketing is in many ways a numbers game. And, more often than not, the number of consumers or the size of the dataset targeted has a proportional relationship to revenue generation.

Case in point, beyond offering targeting on O&O, new retail media channels have notable potential in the context of exclusion targeting (targeting new customers), thereby providing undeniable added value to their brand partners.

2. To Reach Shoppers Where They Are

“Go where your audience is”, is perhaps one of the most well-known marketing principles out there. While it may not find application in every marketing case, it certainly holds true in the context of activation. As it is widely understood, it’s often more challenging (and costly) to entice consumers to O&O compared to simply targeting them on the platforms and in places they already frequent.

As things stand, screens, or, rather, various forms of media, dominate the consumer consciousness. Once retailers identify suitable retail media channels for their brand partners, they can be used to retarget consumers. This allows retailers to tap into an existing yet underexposed audience and boost ad revenues.

3. To Secure Growth

Retailers often find it difficult to sufficiently differentiate themselves from competitors. In addition to offering more value to existing brand partners, platform diversification can help a retailer differentiate itself by demonstrating a clear value proposition.

Of course, offering targeting across multiple channels raises some valid points regarding data security, privacy, and control. After all, the entire concept of first-party data collaboration, and the marketing efforts that stem from it, necessitates the input of data from the retailer, brand and publisher. A retailer offering targeting services beyond O&O could, therefore, be putting its data at risk.

However, it’s possible for retailers, brands, and publishers to retain control of their customer data and offer to target beyond O&O, retailers can make use of a demand-side platform (DSP). DSPs are advertising platforms that make it easy to manage ads across multiple networks on a single platform and can come in handy for retailers looking to scale their retail media offerings on other media channels.

All that said, it’s important to note that while DSPs are a great ad management tool, that’s where their utility starts and ends. Indeed, it’s DCRs that power the collaborations that uncover high-impact insights. DCRs can bring the retailer, the brand, and the publisher together, to support superior media planning, activation, and attribution.

Using DCRs to Support Activation On Alternative Platforms

Now, let’s put it all into context by taking a look at two examples that illustrate the value retailers stand to gain with multi-channel targeting:

• After an encouraging ‘limited edition’ offer, a sporting goods brand is launching a range of maternity activewear designed to appeal to a younger audience. Taking its intention to target new customers and its small dataset into account, the retailer offers to target on an alternative platform. The retailer, brand, and publisher input their customer data into a DCR. The datasets are encrypted, matched, and a lookalike audience is built. Implementing exclusion targeting, the retailer solicits new customers via CTV by running an ad during a supported show that is a hit with the target audience.
• Keeping the above example in mind, consider a situation where there’s a notable uptick in website visits every time its ad runs. However, despite an increase in web traffic and sales, the retailer has yet to meet its revenue targets. The trio, therefore, collaborates once again. This time, however, the datasets are encrypted and matched on common identifiers, and the result is an audience that has either interacted with the ad and/or visited the brand’s or publisher’s site. This is used to inform social media and search and display retargeting ads that push consumers to make a purchase.

While major retailers certainly got a head start with in-house DCRs, on-demand options are well within reach. However, there's a minority of providers like Decentriq which don’t have access to the data, and neither do their cloud providers, giving collaborators security guarantees that most providers can’t match.

Granted, the advent of a cookie-less world isn’t going to happen overnight, however, it’s important to get ahead of the competition, or, at the very least, keep up with it. Depending on the retailer, that can mean stepping up first-party data collection efforts, comparing DCR providers, setting up an RMN, or considering alternative media channels.

Looking to gain more insight into DCRs and retail media? Contact Decentriq today.