What is the one thing that smart carts, interactive endless aisle screens, and mobile scan-and-shop technology have in common? They come with the potential to introduce personalized digital advertising to in-store shopping. Given that more than 80% of total retail sales still take place in stores, retailers are recognizing an opportunity to extend their lucrative retail media advertising programs into physical spaces.

Retailers are taking advantage of existing infrastructure to increase speed to market for in-store retail media. In-store audio, existing screens (such as those at checkout or on TV walls), and traditional demo stations are retail media formats that require minimal upfront investment, allowing retailers to quickly launch in-store advertising. The revenues generated from these efforts can be reinvested into tech upgrades, expanding available media formats.

Some customer-facing technology incentivizes shopper authentication, facilitating more robustfirst-party data collection to fuel retail media. Encouraging shoppers to sign in through the app to access features, like mobile scan-and-go, or to join a loyalty program in exchange for perks, like premium samples, offers a compelling incentive. In turn, this gives retailers access to deeper insights into customer shopping and purchasing behaviors. More robust first-party data sets create value for advertisers by positioning retailers to better attribute exposure to ads back to sales.

Retailers that have developed proprietary in-store shopping tools are betting on third-party retailer adoption to scale their investments. Smart carts and Just Walk Out checkout technology are among the proprietary solutions developed by the likes of Instacart and Amazon—and the companies are now shopping them around to third-party retailers. Any hesitation retailers may have about collaborating with their competition may be tempered by the recognition that developing in-house solutions can be prohibitively expensive.

Read the full report, US Retail Technology 2024.