Retail Media Practice Guide: Effectively Increase Sales at the POS

Retail media is becoming one of the most lucrative areas in marketing, with the European market expected to grow from 10 billion euros in 2022 to 25 billion euros by 2026.

In fact, POS advertising is fundamentally revolutionizing retail through retail media marketing. Additionally, modern technologies such as AI-driven personalization and digital displays allow precise customer targeting directly at the point of sale, which has been proven to significantly increase sales.

In this practice guide, we show you how to fully harness the potential of retail media for your business. From basic concepts to concrete implementation strategies, you will learn how to successfully execute data-driven advertising campaigns at the POS and achieve measurable results.

Basics of Retail Media: Definition and Potential at the POS

The retail landscape is fundamentally changing with an advertising approach that acts directly at the decision-making point. According to the "Retail Media Circle" (RMC) of the German Association of the Digital Economy (BVDW), retail media is "the unique opportunity to present brands and products where their relevance, perception, and acceptance are high, their path to the customer is very short, and their context is most natural" [1].

What is Retail Media and How Does it Work?

Retail media refers to all forms of advertising at the point of sale (POS) – both online and offline [2]. This form of advertising strategically uses retailer data to target customers at the moment of their purchase decision. Retail media covers the entire purchase process – from first awareness to the consideration phase up to the purchase completion [3].

The main formats include:

• Sponsored product ads in search results and category pages

• Digital signage and displays in physical retail

• Mobile apps and in-app advertising in shopping applications

• Electronic price tags as additional advertising spaces

The key to success is the GDPR-compliant use of first-party data, which retailers obtain through loyalty programs, frequency measurements, or checkout data [2].

Current Market Development in Germany

The retail media market in Germany is growing rapidly. According to the FOMA trend monitor, investments in retail media will increase by 27% compared to the previous year [4]. The Advertisers in the Brand Association (OWM) predicts that advertising expenditures for retail media in Germany will amount to four billion euros by 2024 [5].

Noteworthy is that digital advertising now accounts for over 60% of the total German advertising market [6]. Pioneers like Rewe, Lidl, Obi, dm, and Douglas have already successfully implemented the business model, while many other retailers still need to catch up [7].

Advantages over Traditional POS Advertising

Compared to traditional poster advertising, retail media offers decisive advantages:

A study shows that 88% of market visitors perceive digital advertising media, with the average viewing time exceeding five seconds. In contrast, traditional posters only achieve a "fraction" of this attention [8].

Particularly impressive: The unaided brand recall is more than six times higher with digital screens than with poster advertising, while the aided recognition achieves a 1.5 times increased value [8].

Furthermore, retail media enables precise audience targeting through data-driven targeting, reducing wastage and offering the ability to adjust campaigns in real-time – advantages that traditional POS advertising cannot provide [3].

The Most Effective Retail Media Channels for Physical Retail

In modern retail, the battle for customer attention is decided directly at the point of sale. According to studies, 85 percent of consumers in Germany perceive out-of-home media at and in supermarkets [9]. Below, we present the most effective retail media channels that have been proven to increase sales.

Parking Lot Advertising: The Underrated First Point of Contact

Customer contact does not begin in the store but already in the parking lot. Digital out-of-home steles at the market entrance or in the parking lot act as the first touchpoint and positively influence purchase decisions [10]. These advertising spaces allow addressing customers before they even enter the store. Particularly among younger target groups, the familiarity with these media is up to 92 percent [9].

A new, exciting form of advertising is emerging here: EV screen marketing. The market for digital out-of-home advertising at charging stations is growing parallel to the increasing number of electric vehicles in Germany. This new form of advertising offers fascinating opportunities for companies to target a financially strong audience precisely when they have time – namely during the charging process.

Mobile Apps and QR Codes: Bridging Digital and Physical

Mobile applications form a crucial link between the online and offline experience. In a survey, 53 percent of US consumers said they were likely to use their smartphones to scan QR codes [11]. This technology enables:

• Instant access to detailed product information

• Personalized offers through app integration

• Seamless integration of loyalty programs

Digital Signage: Placement and Content Strategies

For maximum impact, digital displays should be strategically placed. Successful locations are, according to experts:

• Entrance area as an eye-catcher [12]

• High-traffic areas with high visitor frequency [12]

• Waiting areas as pleasant distractions [12]

It is also crucial to avoid glare and visual obstructions [12]. In the content strategy, the focus should be on the target group, with regular updates and a well-thought-out content plan [13].

Data-Driven Optimization of Retail Media Campaigns

The success of retail media campaigns largely depends on the intelligent use of customer data. The ability to collect, analyze, and use this data for targeted marketing measures determines the effectiveness of the campaigns at the point of sale.

Collecting and Using Customer Data in a GDPR-Compliant Manner

Retailers possess valuable first-party data through their loyalty programs, frequency measurements, and checkout data. These provide a deep understanding of customer shopping behavior and preferences. However, the data must be collected and processed in a GDPR-compliant manner. Clear and explicit customer consent is crucial and must not be hidden in general terms and conditions. Importantly: The connection to a specific person is only made if consent is present, which the retailer usually obtains through the loyalty program.

Targeting Opportunities at the POS

The collected data forms the basis for precise targeting at the point of sale. Various approaches are available:

• Personalized product recommendations based on previous purchases and viewed items

• Individualized advertising messages tailored to specific interests

• Target group segmentation by purchase history, search queries, or cart contents

• Dynamic pricing based on purchasing behavior and price sensitivity

By analyzing current browsing and search behavior, retail media platforms can deliver personalized ads tailored to the specific interests of the individual customer.

A/B Testing for Retail Media Content

A/B testing is vital to optimize the effectiveness of retail media campaigns. The target group is divided into a test group and a control group. While the test group is exposed to advertising, the control group sees no advertising. By comparing the revenue or conversions of both groups, the incremental revenue can be determined.

To achieve meaningful results, it is important that both groups exhibit similar purchasing behavior before the campaign. Therefore, advanced A/B testing methods use purchase history to create "twin profiles," whose behavior is "identical to the hundredth cent." The result: When a difference in buying behavior is observed after the campaign, it can be stated with statistical certainty that this is due to the advertising measure.

Personalized Offers via App: Best Practices

Retailers increasingly rely on personalized app offers that significantly improve the shopping experience. Personalization extends to website content, email campaigns, product recommendations, and advertising offers [17]. Particularly effective is seamless personalization across all contact points – whether online or offline [17].

A smart customer app uses first-party data for tailored offers and targeted communication [18]. This way, it connects digital and physical experiences and demonstrably strengthens customer loyalty [18].

Conclusion

Retail media is clearly evolving into one of the most important marketing channels in brick-and-mortar retail.

Especially the combination of different channels makes the success. Electronic price tags, digital signage, EV screen marketing, and mobile apps together create a seamless shopping experience. At the same time, the GDPR-compliant use of first-party data allows for precise customer targeting directly at the point of sale.

Now is the ideal time to test EV screen marketing in combination with retail media with advercharge. The technology is mature, the evidence of success is clear, and the potential for revenue increases is significant.

The key to success remains strategic planning: thoughtful use of data, careful A/B testing, and continuous optimization of campaigns form the foundation for measurable results in retail media marketing.

FAQs

Q1. What exactly is Retail Media? Retail media includes all forms of advertising at the point of sale, both online and offline. It uses retailer data to specifically address customers during their purchase decision and covers the entire purchase process.

Q2. What advantages does Retail Media offer over traditional advertising? Retail media enables more precise audience targeting, reduces wastage, and allows real-time campaign adjustments. Studies also show significantly higher attention and brand recall compared to traditional advertising formats.

Q3. How can retailers use customer data for retail media? Retailers can use data from loyalty programs, frequency measurements, and checkout systems in a GDPR-compliant manner for personalized advertising and more targeted targeting. Important is the explicit consent of the customers.

Q4. Which retail media channels are particularly effective? The most effective channels include digital signage, mobile apps with QR codes, electronic price tags, and parking lot advertising. These enable a seamless connection between digital and physical shopping experiences.

Q5. How can the success of retail media campaigns be measured? Success can be measured through A/B testing, comparisons of test and control groups, and the analysis of sales increases and return on advertising spend (ROAS). Case studies show significant increases in store visits and sales.