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Retail media represents the third major wave of digital advertising, building on the earlier successes of search and social media. While search helps users find information and products, and social media leverages influencer marketing and social commerce, retail media utilizes retailers’ first-party data to place ads on their owned properties. This could include owned channels (websites, mobile apps, SMS, digital receipts), in-store or fuel pump displays, and physical touchpoints (end caps, shelf tags).

Retailers and brands are now the center of commerce and attention, evolving from mere distribution points into media platforms. This makes it the next significant step in the evolution of digital advertising.

With worldwide spending projected to reach $150 billion this year and continuing to grow rapidly, the surge in retail media networks (RMN) is driven by a number of factors: heightened consumer expectations for personalization, the limitations of traditional digital advertising, changing privacy regulations like GDPR and CCPA, cookie deprecation, and the siloed nature of walled gardens. 

To help retailers and brands embrace the benefits of retail media networks, we asked two experts to share their insights on a recent webinar, Retail Media Networks: Driving Revenue with AI, Data, and CDPs:

• Art Sebastian, Founder/CEO of NexChapter, a boutique consulting firm specializing in all things digital, retail media, and customer data. He’s also an executive advisor to Treasure Data. 
• Vishal Patel, VP of Strategy at Treasure Data, who has overseen over 100 CDP implementations.

Their key takeaway? Retail media success hinges on robust first-party data. Start now: Prioritize your customer data for retail media networks, ask for help to set your strategy, and don’t get left behind.

Let’s dive deeper into their insights, depending on where you are in your journey:

I’m just getting started with first-party data. How can I improve my readiness for a retail media network?

Retailers and brands face three core technical challenges to retail media network success: fragmented systems, audience blind spots, and measurement gaps. 

• Fragmented systems: Customer data is scattered across multiple platforms, making it difficult to access, unify, and act upon.
• Audience blind spots: Retailers often don’t fully know their shoppers, even with loyalty programs, leading to incomplete customer profiles.
• Measurement gaps: Retailers struggle to provide evidence of the impact of advertising investments within their networks.

These challenges are conquerable. If you’re sitting on data, have digital surfaces to monetize, and want to build real partnerships with CPGs, you have what it takes. What you need is a plan, the right customer data platform (CDP), and the initiative to start.

Here’s where to begin:

• Conduct an assessment of your first-party data across loyalty, POS, mobile, and e-commerce
• Audit identity gaps to understand how much of your traffic is addressable
• Define high-value use cases (e.g. fuel-to-store conversion, food attach offers, in-store screen monetization)
• Identify supporting technology requirements such as a CDP built for enterprise scale and agentic intelligence

I have first-party data. Do I need a CDP to launch a RMN?

Retail strategist Art Sebastian gives his perspective on why CDPs and RMNs are a power duo

There’s a trifecta of critical capabilities a CDP provides that help you unlock the most value out of your data for retail media networks.

Identity

Retailers must communicate with all customers. There is immense value in understanding your identified loyal customers on a deeper level, but also the anonymous shoppers transacting with you. Identifying unknown and known customers is essential and impossible without the right technology. 

Building a first-party ID spine is crucial for understanding your customers comprehensively. This ultimately leads to significant business impact, specifically higher CPMs. By accurately identifying your audience, brands can precisely target their desired customers on your network.

Without a CDP vs with a CDP

Without a CDP, customer data likely resides in separate systems, unable to communicate. You might be able to go in and stitch together some of it together with SQL queries or IT requests, but that’s time-consuming, hindering campaign execution. 

Identity resolution is a foundational capability of a CDP. It unifies disparate customer identifiers (email, credit card, phone, cookies, etc.) to create comprehensive profiles. Best-in-class CDPs deterministically and probabilistically link these for a complete customer view. A CDP provides real-time, updated customer data and segments, enabling immediate, confident campaign launches and targeted advertising, without IT delays. 

Activation

Activation gets your data where it’s needed: to the right person, at the right moment, in the right channel. Activation requires creating high-value, real-time segments with up-to-the-minute data and syncing them across all channels. 

Without a CDP vs with a CDP

Manual activation across channels is inefficient, resource-intensive, and prone to errors. Without a CDP, you may also run into limitations on activating at scale if you’re dependent on uploading simple lists to platforms like Facebook or Google.

A CDP offers native integrations with a wide array of marketing and advertising channels, accessible with just a few clicks. It connects the full picture, syncing audiences across DSPs, ad networks, and owned media, making it easy to reach customers. A CDP with AI decisioning and real-time personalization also adapts messaging and recommendations instantly based on live data and customer behavior. Ultimately, you’ll see improved click-through and conversion rates, providing real value for advertisers.

Measurement

Fewer advertisers can skate by on impressions alone; they need conversion proof at the SKU level to justify continued investments. According to Bain & Company, only one-third of retail media networks today can report sales at the campaign level – a major gap and opportunity. 

Without a CDP vs with a CDP

You don’t want to leave advertisers in the dark. Without a CDP, it’s difficult to prove your network is working for advertisers. This can be due to limited closed-loop attribution across onsite, offsite, and in-store, as well as no consistent metrics or campaign feedback loops.

A CDP enables closed-loop measurement, linking ad exposure to purchases, eliminating guesswork, and proving ad effectiveness. CDPs scale to link vast volumes of impression and transaction data, building advertiser trust through comprehensive reporting. Better insights lead to smarter campaign investments, higher CPMs, and increased ad spend. 

Retailers: The time to move is now

Retail media networks are a strategic imperative for retailers and brands seeking their next phase of growth. The chief benefits of retail media networks are their ability to unlock significant new revenue streams by monetizing valuable digital and physical real estate. Networks that succeed will be undergirded by an AI-powered CDP that enables trusted data, smart segmentation and activations, and closed-loop proof.

And remember, when considering a CDP to help power your retail media network, conduct a proof of concept. As Vishal said during the webinar, “Never buy a CDP without kicking the tires first. That’s the best advice I can give for anybody getting into CDP.”

Watch the webinar to get the full set of insights from Art and Vishal.

WEBINAR

Retail Media Networks: Driving Revenue with AI, Data, and CDPs

Featuring Fortune 500 marketing leader Art Sebastian

Watch the webinar

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Art Sebastian – CEO of NexChapter, former VP of Casey’s, Meijer, and Kraft, and a Treasure Data executive advisor – has worked in the industry for over 25 years and helps retailers and brands keep pace with the change that is taking place. On our recent webinar, Unlocking Retail’s Future: CDPs and the Power of Data-Driven Strategies, Sebastian shared three trends impacting retail’s future and explained how a customer data platform (CDP) can help address those trends and meet the demands of consumers now and in the future.

Discover the top trends for retail in 2025 from Art Sebastian, CEO of NexChapter and a former VP at Casey’s, Meijer, and Kraft

Connection is driving strong retail sales

U.S. retail sales were strong in 2024 compared to the prior year. This growth was partly due to a strong labor market, lower inflation, and a resilient customer. Most of the data Sebastian shared is related to the US, but it can be easily extrapolated to other countries and markets. 

In addition, e-commerce and in-store are no longer considered separate; instead, they complement each other through omnichannel experiences. 

Successful retailers are showing value to consumers and trying to connect on a more individual level. It’s these retailers who understand the trends shaping retail in the coming year.

Three trends shaping retail in 2025

Sebastian shared three trends shaping retail this year: omnichannel experiences, the shift in spending power across generations, and the increasing need for personalization. Let’s look at each one a bit closer.

The power of omnichannel: Shop more, spend more

Your customers are finding and engaging with you on multiple channels. But it’s more than multi-channel; it’s omnichannel, meaning they interact on multiple touchpoints to help them make a single purchase. A recent study found that 73% of retail shoppers are omnichannel. Another study found that omnichannel customers shop 1.7 times more than single-channel shoppers, and they spend more, so it’s essential to provide a seamless experience across all channels and touchpoints. Customer data enables true omnichannel experiences. 

Sebastian said there are a couple ways we see this in action:

1. Click and collect will reach $110 billion in 2024, with three-quarters of that from grocery. In-store pickup is growing, and 44% of in-store pickup customers purchase additional items when they pick up their orders, resulting in higher average order value (AOV). Target expanded its curbside pickup in August, and in the UK, Tesco is continuing its click-and-collect program.
2. Delivery continues to grow thanks to its speed and ease. This includes same-day delivery from services like Instacart and restaurant delivery services like DoorDash and Uber Eats. Sebastian said there are many delivery services outside the US as well.

There’s also a lot of delivery innovation, such as drone delivery, smart packaging that actively engages the product to preserve quality, freshness, and shelf life, and connective packaging, where customers get real-time information about their parcel. 

Innovation is also happening in-store. For example, Walmart is expanding electronic shelf labels (ESLs) to 2300 stores. ESL enables dynamic and personalized pricing (which is not without controversy, Sebastian notes) and reduces labor costs and printed price tags. Several retailers are experimenting with robots that can scan store shelves to identify stock levels and inspect shelf execution. Even Instacart is trying new experiences to digitize the physical shopping cart with capabilities like gamification, location-based coupons, and aisle-aware advertising.

“In the most simple terms, this is about delivering a seamless experience across all the touch points. It’s about having your brand show up very consistently across all channels, whether it’s email, social media, SMS, or an app push. It has to be consistent. And finally, giving your customers multiple ways to shop, and they can order, they can return, they can interact with the retailer. All of this needs to be enabled by customer data to ensure the richest experience for consumers.” –Art Sebastian

Gen Z: Understanding the new power spenders

Spending power is shifting, and in 2025, marketers will need to adjust their strategies to meet the needs of Generation Y (better known as millennials) and Generation Z. Together, these two groups hold 36.6% of the spending power, and marketers will need to understand them better.

Sebastian explained that Gen Z has constant access to the internet, and they see the physical and digital world as one, performing extensive research at home and in-store. They price compare, look to social media (like TikTok) and influencers for recommendations, and use their smartphone for everything. 

Gen Z is also concerned about data privacy and is taking steps to protect themselves against companies they don’t believe can keep their data safe, such as anonymous browsing and blocking cookies. However, if they trust a company, they are willing to exchange their data for more personalized, elevated experiences. 

Marketers must work hard to create the experiences this generation demands, but those experiences also generate a lot of data that can inform better marketing decisions.

Personalization: Key to customer loyalty

The 2024 State of Customer Service and CX Study shows it clearly: 81% of customers want a personalized experience, and 70% said that it’s important that an employee knows them and their history with the company. 

Delivering personalized experiences remains challenging for many retail companies for a few reasons:

1. Data fragmentation is a serious challenge. Many companies don’t know what data they have or where the data they need is located. As a result, inaccurate reporting and poor decision-making lead to bad experiences. 
2. Walled gardens prevent marketers from combining all the data they need to make better decisions. This is especially true for social media platforms, which have a wealth of data from paid media.
3. Consumers can choose the ads they receive and what information companies can access to personalize experiences.
4. Privacy regulations are increasing. To date, 19 U.S. states have enacted comprehensive consumer privacy bills that can impact how companies manage customer data and deliver experiences. If the regulatory landscape becomes more and more complex and fragmented, the compliance challenges only increase.
5. Cookie deprecation is an ongoing issue that may never be completely resolved. Marketers must find other ways to capture important data. 

What do all these challenges mean? They point to a compelling need for first-party data, which a customer data platform can help address.

Overcoming data challenges with a CDP

Implementing a customer data platform creates value across the organization, helping marketers address these retail trends and create the experiences customers expect today. The CDP unifies first-party data from all your systems, giving you a single view of the customer. You can then enrich that data with supplementary data from zero-, second-, and third-party data sources, improving data accuracy and reliability. You can also add unstructured data from primary research. 

With a CDP built for large retailers like Treasure Data, you can identify high-value audiences and create real-time personalized interactions through messaging, offers, recommendations, and content. One example Sebastian provided involved consumers who use a loyalty card at the gas pump. While filling up, the company could trigger an SMS message for an energy drink and have the pump play an associated ad. When the consumer goes in to pay for their gas, they buy the drink and other impulse purchases, increasing the company’s gross profit. Sebastian said this type of triggered campaign can generate enough ROI to cover the cost of your CDP investment. 

As the relationship grows, you gain deeper insights into the customer, their shopping behaviors, and interactions and find ways to drive business growth. Another great example involved creating a segment of loyalty members who are also email subscribers, morning shoppers, and who buy coffee but have never bought a breakfast sandwich. With a targeted email offering a 50% off coupon for a breakfast sandwich, you can influence specific behavior and spark incremental gross profit.  

Grocery stores and retailers are also good examples of companies with a high frequency of purchases and a lot of customer data that are using CDPs to explore segments on the fly to determine opportunities, create triggered campaigns, and when ingested by a CDP deliver personalized experiences across the entire customer lifecycle. 

Unlock your data’s potential with a CDP and transform your retail business

Sebastian said there are many trends to watch regardless of your industry. For retailers and CPG brands servicing retailers, omnichannel, generational spending shifts, and personalization should be top of mind. 

What helps you address these trends and deliver the experiences your customers demand is your data. Customer data is now your number one asset, and you need to manage it properly. A customer data platform helps you unify, enrich, grow, and activate your customer data.

Start with small practical use cases that deliver immediate business value and impact. Working together, marketing and IT can drive the innovation needed to propel revenue growth.

Webinar

Unlocking Retail’s Future: CDPs and the Power of Data-Driven Strategies

Featuring retail strategist Art Sebastian

Watch the webinar

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Retail Media Networks (RMN) have become a popular way for retailers and brands to optimize their wallets during this time. In fact, despite the economic headwinds, eMarketer predicts retail media networks are expected to see double-digit growth for the next several years.

The time is ripe for a retail media explosion. With an increased focus on consumer data privacy and security, as well as shrinking access to third-party data, retail media networks provide another avenue for retailers and brands to collect first-party information, and use it to build their bottom line. 

What is a Retail Media Network? 

A retail media network is a proprietary advertising network created by a retailer across all of their digital sales channels. Retail media networks give second-and-third-party brands the ability to purchase ad inventory and market to customers across their owned channels with an extremely targeted approach. It’s similar to in-store advertising, but done digitally. 

Shoppers are often more receptive to advertisements when they are already on a retailer’s site. The proximity and relevancy of retail media networks provides a convenient way to target customers throughout their buying journey, and deliver the right offers, at the right time.

Benefits of Retail Media Networks

For retailers, retail media networks do more than drive incremental sales; they also create a new, highly profitable revenue stream through data monetization of owned first-party data. With the right customer data and insights, retailers can offer targeted advertising that benefits both themselves and their customers, leading to increased customer loyalty and brand advocacy.

This enables retail brands to narrow their target audience and optimize their customer journey. Many retail media networks allow retailers and their suppliers to share customer data in a privacy-focused way. As a result, retail media networks give retailers access to vast amounts of customer insights that help them better understand their customers. 

Even stores that are traditionally brick and mortar, like Target or Best Buy, have benefited by creating new and exciting touch points for customers who prefer to shop online. Brands can do this in a number of ways. 

• Digital Shopping Experiences. Digital ad placements on owned web and mobile app properties open up new ways to personalize customer experiences with hyper-relevant content and product promotions. Strategic product promotion can also help increase cross-sell and upsell opportunities at checkout. 
• Brick-and-Mortar Experiences. Retail media networks extend beyond just digital channels, as digital media begins to proliferate in-store locations. With geolocation and transactional data, retailers and partner brands can optimize promotion based on shopping behavior and demand across specific regions, or store locations.  
• Omnichannel Experiences. Online and offline channels, of course, don’t exist in silos. With connected customer data, retailers can orchestrate seamless customer journeys that tap into individual buying behaviors. 
• Campaign Optimization. Brands are also able to leverage inventory on retail media networks to test ads, see what works, and who it reaches. Once brands receive access to this data, they can scale successful creative campaigns, and gain valuable first-party data in the process.

Connecting CPG and Retail with Data-Driven Insights

CPG brands have been open to using retail media networks because they create an opportunity to advertise to specific customers at scale. Rather than large scale media buys, the brands can be more targeted in their approach and optimize spend, which is critical to maintaining sales in a slower economy. Partnerships between CPG and retail brands can improve the quality of products and services delivered by both parties. 

For example, one Japanese retailer launched a marketing lab that made their consumer data available to CPG partners that sold products on its B2C website. The CPG brands were able to use this data to optimize promotions, and make smarter decisions about inventory and future product development. The wealth of consumer behavioral data helps the brands understand how to improve packaging, pricing, and other product extensions, as well as determine new product launches in partnership with the retailer. 

Unified Customer Data is Essential for Retail Media Network Success

While retail media networks have proven to be a powerful tool for marketers to reach customers at the point of purchase, there is still room for further optimization and improvement. Retailers must also be aware of data challenges that may exist when preparing to launch retail media network initiatives, and how to overcome them.

Develop a Strong First-Party Data Strategy

One of the biggest benefits of retail media networks is the reduced reliance on third-party data, and the ability to monetize and activate on first-party data effectively. Retailers should ensure they have a strong first-party data strategy in place to continue to build direct relationships with shoppers. This will ultimately lead to reduced reliance on external agencies, as data management operations move towards owned data as a priority. 

Create a Connected Customer Identity 

Like any omnichannel marketing strategy, establishing a connected customer identity is essential for accessing the insights needed to make real-time decisions about the customer journey. This means breaking down data silos to create unified customer profiles that can be shared across the organization, and strategically with brand partners. 

Identity resolution is able to reconcile identifiers across online and offline channels, and enrich customer profiles with more accurate data. This gives greater visibility across both known and unknown audiences, and reduces risk of inaccurate or redundant customer data when managing promotions across brands. 

A holistic view of the customer journey sets the stage for omnichannel customer journey orchestration and automated campaign activation,, which can then be optimized over time. 

Treat Customer Data with Respect 

Building first-party relationships with shoppers starts with establishing trust. With data privacy a growing concern, shoppers expect brands to manage their data safely and securely. Retailers should ensure consent and privacy preferences are integrated into customer profiles, and that data access permissions are managed appropriately across teams, brands and partners. 

Data clean rooms are also becoming a more compliant way for retailers to securely manage data exchanges with partner brands. Learn more about how data clean rooms work here. 

Making the Most Out of Retail Media Networks

Retail media networks are becoming an established alternative for digital advertising, while reducing reliance on third-party networks. Large retailers are already seeing initial success from these efforts. As more brands follow suit, only time will tell what new marketing strategies will emerge.

The post Retail Media Networks: Optimizing Data Partnerships with a CDP first appeared on Treasure Data.

A customer data platform (CDP) provides the ability to collect and organize all the data necessary to perform better inventory planning and optimization. A CDP connects customer-facing systems with data from product management, order management, and other supply chain management systems to ensure a complete view of how products and services are engaged with and sold.

With a centralized view of your product engagement and customer buying patterns, you can understand what’s being purchased, where it’s purchased, and how. And, you can use this understanding to improve your planning processes in a number of ways.

Demand Forecasting

Demand forecasting is the process of predicting how much of a product or service consumers will want during a defined period. For example, how many televisions will consumers buy over the holiday period?

To adequately forecast the demand for a product, look at historical purchasing patterns. These patterns help you forecast when specific products will be in higher or lower demand. But it’s not only historical data you want to examine. You can even better predict demand by looking at customer intent and propensity to buy as well. 

A CDP can tell you the historical purchasing patterns for your product. It also tracks customer activity across the entire buyer’s journey. Predictive analytics can take all this information and forcast how much demand you can expect for a product. 

For example, say historical data shows that 500 televisions were sold between October and December last year, and based on past sales in prior years, you predict that number will increase by six percent this year. But there’s also lot of customer activity among existing television owners looking to upgrade to a newer system in a particular geographic location. The CDP predicts that based on historical sales and the uptick in activity among existing customers, that demand will increase by 10 percent, not 6 percent.

Planning Inventory by Channel Based on Demand

On a channel level, a CDP can help you plan your inventory across your e-commerce site and brick-and-mortar stores. This is critical because out-of-stock messages, whether online or in-store, are a serious customer experience issue. 

According to the Adobe Digital Economy Index, consumers saw 60 billion out-of-stock messages between March 2020 and February 2022. Unfortunately, this trend is expected to continue, and consumers are not happy. A McKinsey study found that of 60 percent of U.S. consumers that experienced out-of-stock items during a three-month period, only 13 percent waited for the item to come back in stock; 39 percent switched brands or products, and 32 percent switched retailers.

These statistics are for online shopping. The story is similar in-store. Correctly forecasting demand at the channel level helps you plan inventory better, ensuring the right amount of products are available in the right locations.

Collecting Customer Feedback

Customer feedback helps organizations understand what is working and what isn’t. That leads to better decision-making around new product and service offerings, product offers, and the ending of existing product lines. 

A CDP captures this customer feedback from a number of systems, including customer service and support, CRM, marketing automation, customer feedback surveys, review sites, and more. It can then combine all this feedback to provide marketing, sales and product teams with a close-up view of what customers think about products and services, and how they perceive the shopping experience.  

By leveraging machine learning and predictive modeling in a CDP, you can also detect patterns in historical data and current customer activity. This information, combined with direct customer feedback, guides efforts to improve products and services, ensure the right offers are available, and identifies which products are underperforming.

Returns Management 

Returns are a huge cost center. One report states that returns for online orders average 30 percent or higher than that of brick-and-mortar stores. That’s a lot of inventory that must be managed appropriately, resulting in high labor costs for restocking, logistical expenses, lost revenue, and increasing the chances of out-of-stock messages for other buyers. The same report states that the cost of processing returns is anywhere from 20-65 percent of the actual product itself. 

It’s unlikely you’ll be able to eliminate returns, but by understanding past purchase history, retailers can make smarter decisions about mitigating returns. For example, suppose you have a customer that continually returns items purchased online. In that case, you could include that customer in more marketing for in-store sales where they can try the item before purchasing it, or helpful content that will help them find the right products they’re looking for.

Logistics and Supply Chain Management 

By understanding what products are popular and where, brands can strategically stock inventory at warehouses to cut down on transport costs. A CDP can help you understand which physical store locations sell the most of a certain product or that a large percentage of customers who order a product online live in a specific city or state. You then use this information to determine how much product to carry at specific warehouses that feed physical stores or online orders. 

Strategically stocking warehouses shortens delivery times to the end customer or store and reduces shipping expenses. It also cuts down on CO2 waste, a huge environmental benefit many customers appreciate and look for in a retailer.

Brick-and-Mortar Store Planning

Retailers have faced their share of challenges with brick-and-mortar store planning. In 2021, Coresight Research indicated 5,048 store openings and 4,975 closures across the U.S. and UK. In addition, UBS analysts predicted that 80,000 stores would close by 2026.

Retailers need to be more strategic with their physical store planning. By understanding historical customer purchases, returns, and current shopping activities, they can improve their planning of physical locations for new stores, pickup locations for online orders, or other in-store services.

This is also a critical process for DTC (direct-to-consumer) companies that want to open physical stores. A CDP can help them understand where they could strategically open a store to meet the needs of existing and potential new customers.  

Customer Data is Key to Making the Right Inventory Management Decisions

There are many ways retailers can leverage customer data to make informed product and supply chain decisions. By connecting data from the appropriate systems in a CDP, retailers can analyze historical purchase data, including what products were purchased, where, and how, and apply predictive modeling to forecast where demand will be greatest. These efforts create efficiencies in product development and supply chain management and improve the customer experience, which is top of mind for every retailer today.  

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