AI-Driven Retail Media Networks

Portal to the Retailverse: Enter the Network

The atmosphere in the stadium is electric. It’s a tie game in the bottom of the ninth. The winner gets a spot in the playoffs — and you have the best seat in the stadium. Sitting directly behind home plate, more than 40,000 other fans hold their breath as the opposing pitcher winds up. In the batter’s box, your team’s all-star first baseman stands waiting. In a blur, his bat connects with the incoming fastball. A sharp crack reverberates around the stadium, instantly drowned out by the deafening roar of jubilant celebration. The ball soars into the night sky and lands right in front of a billboard advertising a new pizza chain that’s opened near you.

Seeing the ad, you realize that you’ve become so absorbed by the game that you forgot to eat dinner. No problem. With a quick tap on the button controlling your VR headset, you order a pizza directly from the billboard. The truth is that you were never really at the game — your hometown team is hundreds of miles away. But through a promotional giveaway hosted on a national retailer’s media network, you received exclusive access to virtual seats that made you feel like you were in the ballpark experiencing everything in person. The pizza you just ordered also came with a 10% discount because of another promotion the retailer ran during the game.

In 2049, retail media networks (RMNs) will cater to customers through hyper-personalization and present opportunities beyond the bounds of legacy media. Through opt-in features, customers will be able to provide information that allows retailers to take their media networks beyond simple product offerings and advertisements, letting them build carefully curated media ecosystems that show customers content that strongly resonates with them. In turn, retailers will benefit by offering more targeted products to customers while creating a platform that itself can become a revenue stream through selling access to third-party brands.

As you finish watching the post-game interviews, an alert pops up on your phone to let you know your pizza has arrived. Removing your headset, you open the front door to find a small delivery robot that cheerfully warns you to mind the hot pizza box. With a friendly goodbye, the robot zips back down your driveway and you receive another notification on your phone. Because you took advantage of the discounted food order, the retailer just gave you more exclusive access to the first playoff game.

Curious about how advanced technology can help retailers connect with their customers? Learn how companies can use AI to personalize media content to their customers.

The Data Nebula: Why RMNs Matter

The RMNs of the future will evolve into something that goes beyond traditional advertising. Most retailers currently use their networks as places to promote their own products and sell space to other brands, but the way companies deliver those ads continues changing. Whether through in-store screens, smartphone applications, or e-commerce sites, RMNs allow brands to engage with customers in a more targeted, purposeful way, using an omnichannel experience that meets people where they are.

For example, a footwear brand sells directly to customers through its website, but they may choose to run ads on a national retailer’s RMN. Although the company already has its own sales platform, its reach is significantly smaller than that of the national chain’s. By advertising on the retailer’s RMN, the footwear brand gains access to the retailer’s extensive omnichannel presence while also gaining something more: data.

RMNs allow retailers to leverage key insights from multiple sources, including valuable first-party data. This gives them direct access to information that can show customer shopping patterns, which retailers can then use to incentivize other brands to advertise on their networks. Rather than relying on third-party data brokers, product manufacturers can get information directly from the retailer where their items are sold. Subsequently, retailers benefit by helping brands and customers connect through more relevant product offerings. In this way, the retailer, brands, and customer all benefit from the RMN.

Moreover, as RMNs expand, retailers have an opportunity to deploy novel promotional strategies, such as access to limited-edition products and events, fostering greater customer loyalty and enthusiasm. These strategies aren’t just limited to large companies with established RMNs; retailers of all sizes have the potential to establish media networks that benefit their businesses. Social media, email lists, loyalty programs, and e-commerce platforms allow even comparatively smaller retailers to cultivate a bond with their customers that can drive sales.

How can retailers balance the power of digital marketing with the need for user privacy in a hyper-connected future? Listen to our 60 Second Retail podcast.

Preparing for Launch: Navigating AI Integration

A large part of the value RMNs provide is in the way they create customer engagement. Much of the data that underpins these networks comes from customers choosing to provide information about their shopping habits and preferences directly to a retailer, creating an opt-in approach to data collection. This can take the form of customers offering their information in exchange loyalty program benefits or customized shopping experiences. By handling that data responsibly and keeping privacy as a foundation of data governance, retailers can see benefits from data insights while allowing their customers to retain control of the information they provide.

Additionally, emphasizing the use of first-party data gives retailers greater control than reliance on third-party data brokers. It can also help companies structure data in a way that’s readily usable by artificial intelligence tools, enabling faster, deeper analysis of customer habits. With those details in hand, retailers can further enhance their RMNs in real time, opening up new marketing possibilities.

As an example, a customer shopping for a new television on an electronics retailer’s app has filtered their search results by specific features. Based on the customer’s criteria, artificial intelligence (AI) software instantly produces a list of TVs from brands currently advertising on the RMN. It then pulls promotions from those brands, factoring them into each item’s price, along with the customer’s rewards member discount. Wanting to see the products in person, the customer heads to the store and, upon their arrival, receives a notification on their phone that shows the section of the store where the TVs are located. Integrating real-time insights from AI into RMNs creates a consistent experience for users across different channels no matter how they choose to shop.

Is your retail organization ready for the new rules of engagement in an AI-First world? Discover how AI agents are reprogramming consumer interaction and decision-making in the AI era with BDO's A Retailers Guide to Agentic AI.

Mission Control: How BDO Can Help Guide Your Business Into the Future

No matter how advanced RMNs become, their foundation must still be built upon customer relationship management. AI and advanced tools can expand the capabilities of RMNs, but building meaningful engagement with customers will continue to require a human connection. That means deploying CRM data and applying it to RMNs in new ways, but it also requires that retailers build and protect a high level of trust with their customers.

BDO’s Privacy and Data Protection services can help retailers design privacy into their marketing frameworks, making important aspects of collecting, handling, and storing personal data an inherent component of companies’ marketing efforts. As part of this, opt-in choices let customers decide which marketing communications they want to engage with, presenting people with transparency that helps to build trust and improve data quality, leading to increased interaction with retailers and the brands that advertise on their RMNs.

Many of the tools and resources that businesses need to enhance their RMNs already exist, but missing pieces in the data governance puzzle present an obstacle to unlocking the network’s potential. The RMNs of the future may look different from what they do now, but the need to understand and act on customer data will remain their cornerstone.