‘Are you spending my money wisely?’: Marketers get creative to address RMN transparency questions

However, achieving full transparency is proving to be easier said than done.

This year, U.S. retail media ad spend is projected to grow 26% to reach $54.48 billion, according to a forecast from eMarketer. This means that, as more money is pumped into the space, return on ad spend will become the focal point for marketers looking to understand just how retailers are helping them gain new business.

Making sense of a hodgepodge of data

The push to audit retail media supply chains and build out client dashboards is coming in part from the clients themselves, who want access to granular-level data like sales information and product page views. Increasingly, these clients want assurance that their agency partners understand whether retail media ads are actually bringing in new customers or simply capturing existing buys, said one media agency exec who spoke on the condition of anonymity.

A second anonymous exec said their agency is starting to audit RMN media spend and supply chains while also encouraging clients to internally track that spend. “I have never been part of a negotiation that wasn’t focused on what could be done, not what would force an agency to do something inappropriate for their other clients,” said the second exec. “Let the media person figure out where the dollars are going.”

The challenge often lies in getting retailers to routinely hand over a full stack of insights that drill down to the dollar. In some cases, media execs say they can tackle the challenge from the front end, by demanding transparency around media planning and fees during the negotiation process. In other cases, where data is harder to get from the RMNs themselves, agencies find themselves working with a hodgepodge of retailer data and information from third parties to paint the picture for clients.

“I haven’t seen much flexibility from them in that space,” the first anonymous exec said. “There’s some stuff that we can do but you’re often a bit handcuffed.”

For example, during a recent campaign, the first exec’s agency ran a connected TV ad campaign using Walmart’s customer data and received feedback on how the ads influenced Walmart sales. However, the actual media buying was done through The Trade Desk, using Walmart’s data to target the right audiences.

John Geletka, founder and chief experience officer of creative and strategic agency Geletka+, said his agency builds custom dashboards for almost all of its clients. “We use [analytics and ad intelligence] tools like Looker, Tableu and [Microsoft Power BI] and sometimes where necessary we bring in other tools like funnel.io to make data even easier for our clients to follow,” he said in an email to Digiday.

Rehashing the programmatic debate

All things considered, retail media is a relatively new channel, so the kinds of infrastructure agencies and their clients get with the likes of Google, Meta and Amazon may not yet exist with RMNs, especially long-tail players that are new to the game. At the same time, more RMNs are pushing into off-site channels, like streaming or social, to expand their reach. But they’re also extending the supply chain pipeline, making it harder for marketers to understand where their ads end up, ultimately raising concerns about media waste.

Sure, some RMNs like CVS Media Exchange, Instacart and Target have aligned themselves to retail media measurement standards from the Interactive Advertising Bureau (IAB) and Media Rating Council (MRC), which were finalized in January. However, media buyers and planners say some RMNs simply aren’t willing to release granular-level insights unless advertisers fork over some extra cash.

“Certain media partners, certain networks can put strangleholds on agencies and clients because of their size. They have this bravado to them that they know you cannot find this shit anywhere else,” said Boris Litvinov, president at ad agency Left Off Madison. (Litvinov did not say which specific RMNs he was referring to.)

The conversation harkens back to the programmatic debate in which agency fees and services came into question, said Rob Douglas, Left Off Madison CEO. If media planners have to put in extra time to give clients the full picture, clients run the risk of agencies charging “the cost of doing business,” he said, passing those costs onto clients.

The nature of media buying

Still, the five industry experts Digiday spoke with for this piece said all of this is the nature of the business. The media negotiation process has always been a gray area, in which media suppliers are willing to unlock value, like data and shelf space, for the right price. And again, the growing RMN space is still relatively new, both for retailers themselves and for the buyers and planners striking deals in the space.

As with programmatic ad buying, there’s the cost that the retailer has set for the media and then there’s the cost of executing that media, which creates a margin, said a third anonymous media exec. It’s not necessarily a bad thing, they said, but it is a matter of supply and demand.

“There is a wide fluctuation in off-site margin that is being charged,” said the third anonymous exec. “The same way if I am buying media from any media company, there is margin there too.”

But, the third exec acknowledged, in a data-obsessed, cash-strapped industry, it makes sense to ask for detailed reporting and looking for hidden fees or media waste, according to the third exec.

“If you’re making this much money, you should be in the hot seat. You should be the one who is being asked to verify: Are you spending my money wisely?” they said.