Experiential Retail Media: The Next Frontier

Advertisers are expected to pour over $62 billion into retail media this year, up more than $10 billion from last year, making it the go-to channel for ad spend. Built on a strong foundation of first-party retailer data and closed-loop measurement, the U.S. retail media ad market is moving beyond e-commerce into new ad formats, sales channels and touchpoints, and retailers need to take notice.

Experiential Retail Media™ marks the evolution of retail media. This desired three-pronged marketing approach — multisensory, multichannel and multimedia — benefits both retailers and brands. It drives immediate sales and enhances long-term customer value.

But what does this look like for retailers and advertisers? It means in-store ads that are identifiable, at scale. It means retailers easily connect brand interactions to campaigns, and receive unique and measurable media tactics. It means we’re bringing advertising back to the physical store, which has always been the ultimate discovery platform.

How Did We Get Here?

Let’s take it back to the beginning, with Retail Media 1.0. It was primarily propelled by retail media on-site search ads driving e-commerce sales. This era was dominated by Amazon.com and a small handful of heavily trafficked e-commerce retailers.

Then Retail Media 2.0 emerged, emphasizing a data-driven strategy integrated with physical assets. This era saw retailers leverage their first-party data to activate upper- and full-funnel marketing efforts. These included display, video, social media, connected TV and in-store media, with campaign impact measured across both online and in-person sales channels.

But that isn’t enough. The industry continues to struggle with retail media’s lack of standardization and measurement. Combined with the problems facing the economy, including the ever-changing tariffs, it’s beginning to force retailers to figure out how to strike the right balance between on-site and off-site.

Related story: The Future of Retail Media is Off-Site

Enter Experiential Retail Media

Which brings us to 3.0, where we can recognize retail media’s full potential. Going beyond search and online (1.0), in-store/physical combined with digital capabilities (2.0), 3.0 combines all of these elements, while evolving across media formats to include product samples and experiential touchpoints.

Experiential Retail Media merges the strengths of media and merchandising, content and commerce, and branding and performance. This powerful combination aims to boost both online and in-store sales while simultaneously cultivating lasting customer connections.

And it works because it’s a natural evolution of consumer behaviors and preferences. It is multisensory, multimedia and multichannel.

Multisensory

It engages consumers' senses precisely where they're most open to trying and finding new products.

Traditionally, product sampling has been seen as an old school marketing tactic and analog experience, intended to drive brand awareness with little ability to measure its impact. While successful, it’s been hard to track. Experiential Retail Media reimagines product sampling as a multisensory media impression. It adds the benefits of in-store digital display to the sampling experience by adding touch, taste and smell to the sight and sound of an interactive screen.

Not only is this creating a lasting impression for consumers, but it bridges a gap that most retailers didn’t even know existed.

Multimedia

It condenses the marketing funnel through the addition of a sampling experience.

Unlike in-store advertising, which is focused on top-funnel brand awareness, Experiential Retail Media drives product trials right at the point of consideration.

The No. 1 channel driving new product discovery is the physical store, with 46 percent of U.S. consumers purchasing new items at brick-and-mortar locations. For brands or products that already have awareness, product samples provide the “last, best marketing touchpoint” and help streamline a shopper’s path to purchase. When introducing new products or brands, samples serve as the initial and strongest connection, often rapidly moving consumers through the entire marketing process. By providing a unique chance to discover and try new items, sampling can significantly speed up the buyer's journey and turn shoppers into loyal customers.

Multichannel

It reaches the shopper at every step of their journey.

Modern retail media strategies must be omnichannel, reflecting the way today's consumers move between physical and digital media. Experiential Retail Media merges these approaches, using interactive experiences to boost engagement and maximize marketing impact.

Putting it Into Action

Experiential Retail Media delivers incremental results. It drives short-term sales while acting as a catalyst for longstanding buyer relationships.

As the sensory evolution of in-store digital display, Experiential Retail Media focuses on delivering the key functional and emotional benefits most valued by shoppers: discovering new products and accessing savings, all while creating a more engaging and interesting shopping experience.

Brand experiences are the pinnacle of customer engagement and often the beginning of longstanding buyer relationships. This new media format uniquely influences consumer behavior and optimizes marketing impact, surpassing other media types. As in-store marketing evolves through innovative product sampling into interactive digital experiences linked to customer identity, it becomes an unparalleled medium for engaging all five senses and driving greater results.

As retail media continues to remain one of the fastest-growing segments of the media ecosystem, we will continue to see an increase in spend across retail media networks. For retailers and brands that want to stay competitive and increase product visibility, embracing Experiential Retail Media is crucial. After all, consumers are more likely to purchase a product when they can experience it firsthand.

Matt Eichorn is CEO and founder of Freeosk, an Experiential Retail Media™ platform delivering multisensory, multimedia, multichannel campaigns that influence shopper behavior in measurable ways.