UM's New Commerce Tool Gives Clients More Control Over Their Retail Media Investments

Before the pandemic, UM was working with a handful of clients on retail media and commerce investments that totaled about a few hundred million dollars in billings. Now, as many 40 clients are driving $2 billion in global commerce billings for the agency. The retail media space is ballooning, and not just at UM. By 2026, retail media will account for as much as 25% of all digital ad spend, according to Boston Consulting Group estimates. As the space becomes more important, UM's clients often wonder how much they should spend with retailers, and how much retail media investments will drive sales. The Next Frontier in Retail Media Is Audiences Now, the IPG Mediabrands agency is tackling that question with its proprietary tool called Shoptimizer. The agency's Commerce Practice will rely on the tool to plan and buy retail media. It's been effective so far. The agency used the tool to plan commerce media buys for several large consumer companies during a test phase. Those brands experienced between 12% and 15% lift in incremental sales. Those that tested the technology told the agency they enjoyed more transparency, and admitted Shoptimizer gave them a deeper understanding of how retail media networks contribute to their bottom line. W. Joe DeMiero, U.S. CEO of UM, compared the state of commerce to the early days of social media, mobile and the internet. "It's very fragmented, it's very confusing for clients, it's hard to just do the basic level of integration to get the appropriate analytics for accountability and measurement," he said. 'We're doing this manually' Shoptimizer is one of Mediabrands' new offerings, tucked into a dedicated business unit it's dubbed the Unified Retail Media Solution. That practice helps clients manage their commerce investments and view media performance across all the retail media networks. UM has a long history of work in the commerce space, led for about a decade by its U.S. head of commerce, Amie Owen. An older tool, UM's ShopSmart dashboard, sorts commerce media solutions by KPI and retailer. It's the foundation the new Shoptimizer tool rests upon. It's "a Rolodex of everything that you could buy from a conversion standpoint, when it came to tactics, that triggered an online sale or an offline sale," Owen told Adweek. Attribution Will Make or Break Retail Media Efficiencies between 12% and 15% The new tool goes further than ShopSmart because it takes retailers' historical spend, KPIs and budgets into account to automate the investment process. It optimizes media investments with particular retailers based on what's working. Previously, UM relied on manual calculations to make these kinds of investment decisions. "Like, it was in Excel," Owens said. "It was really time consuming." One of Shoptimizer's key benefits is that it speeds up the retail media investment process because it's integrated with retailers' merchandise data. Speedier processes wind up saving marketers money on service costs. Plus, it ensures clients spend media investments more efficiently across channels that actually drive results. Before UM built Shoptimizer, the agency might wait as long as eight weeks after launching a campaign before receiving meaningful performance reports. "It's not just understanding the unit sales and the dollar sales at that retailer. It's how much the media is driving those sales," Owen said. In practice, it means that if a client buys media from Target, UM media planners can view the client's Target investments within Shoptimizer. The platform might reveal that search is performing better than a particular in-store activation. With eyes on such relatively granular data, media buyers can shift investments based on what's working in any given time period and pull money out of ineffective activations. The tool gives media buyers better insight into metrics and data, although the level of insight still varies by retail partner. Some retailers give UM performance data weekly, some daily and some still take longer. "This is constantly evolving, and we're constantly updating the tool itself, so it varies," Owens admitted. UM's commerce team began planning Shoptimizer roughly two years ago, taking about eight months to build the tool, including its lengthy taxonomy. It's now launching after a year-long beta phase. Google Changes Name of Ad Product Amid Inventory Quality Scandal Using Acxiom's open architecture UM data broker Acxiom develops its technology within an open architecture. This means UM developers can build on Acxiom's product development frameworks to get new products to market quickly. Plus, UM can leverage Acxiom's demographic, behavioral and transactional data within Shoptimizer. This way, ads are more likely to reach desired audiences—people from specific demographics, with specific characteristics that make them more likely to purchase a client's product. "Investments like Shoptimizer allow us to use the hundreds of millions of dollars, [and] the last decade of investment that IPG broadly and IPG Mediabrands broadly has made in assets, data assets, tools, etc., to the benefit of our clients very quickly," DeMiero said. With Acxiom data, Shoptimizer can even model how audiences compare across retailers, so marketers can make an informed decision to invest with one retailer over another. The tool allows marketers to be more flexible with their budgets, but also grants them more partnership options by integrating with clients' preferred data partners. It could even support integration with a competing holding company's data assets, like Publicis' Epsilon. UM is betting that its new tool's inherent flexibility will make it attractive to marketers who want to take more control over their investments and partnerships, and those seeking more transparency into where marketing investments actually go.