Crossing the Retail Media Pond: What the U.S. Can Learn from the U.K.'s In-Store Media Innovations

Retail media networks in the UK and the United States are shaped by distinct regulatory landscapes and data practices. In Europe, stricter data privacy regulations place more of a barrier between retailers and the expansive data pools available to their American counterparts. The sheer scale and size of the United States means there’s a more expansive choice of retail media networks to look into , some estimates say 600 RMNs exist in the United States, compared to just a couple hundred in the UK. For these reasons, experts sometimes say brands in the UK ought to look to the US for what to do next. In reality, however, the exceptional levels of interest in retail media in the last few years has meant leading-edge innovation and breakthrough behaviors have been at the forefront of UK businesses, stirring up valuable lessons for businesses in the US.  According to Emarketer, retail media carried close to $4 billion of revenue in the UK in 2023. This ad format took just seven years to achieve this milestone, far outstripping social (which took 13 years) and search (17 years).

A Billion-Dollar Data Question

The RMN market is projected to reach $54 billion in 2024, with grocery media networks alone accounting for $8.5 billion, according to Grocery Doppio. There is strong executive interest in the deployment of media networks, the research shows, with 88% of leaders identifying media monetization as a top growth priority. The same Grocery Doppio study reports that 73% of grocers consider retail media a C-level priority for their organization. However, the research also warns that grocers face a short timeframe in which to take action and must adopt strategies to achieve seamless digital-store integration and measurable ROI. First-party data is what fuels retail media. Necessity – or scarcity – is the mother of invention, and in the face of stricter privacy laws, Europe’s business decision-makers have gotten creative with how they use retail media to gather first-party data.
Tesco, the UK’s biggest grocery supermarket chain, for example, says it is exploring plans to use artificial intelligence to ‘nudge’ its loyalty card members when items in their shopping baskets go beyond certain daily requirements for things like sodium. The opt-in nature of the Clubcard would allow the chain to capture large amounts of customer data, but also opens up avenues for even more personalized shopper experiences – a huge boon for brands, consumers and retailers alike.

Make More of In-Store and Digital Out-of-Home

British businesses are adept at seizing opportunities to make their message visible at myriad touchpoints, and the landscape is evolving rapidly. By 2024, according to Emarketer, digital out-of-home advertising is projected to comprise a substantial two-thirds of the UK's total out-of-home ad expenditure, significantly outpacing the U.S. at just 34.8%. Grocery retailer Sainsbury’s has long been a proponent and innovator in the space. In the summer of 2017, the retailer made a splash by taking over billboards in some of the UK's busiest train stations. They displayed a digital countdown showing commuters how many hours of sunlight were left in the day, nudging and encouraging shoppers to buy products for backyard grilling sessions while enjoying the longer evenings.
More recently, Sainsburys launched a digital out-of-home campaign that adapted its fashion advertising to real-time weather conditions across the UK. The campaign showcased styles from Tu's Spring collection on live screens from March 13 to March 26, responding to varying weather patterns to ensure the featured outfits matched current conditions. Those in the know tend to agree that in-store retail media is a step ahead in the UK compared to the US.
In this sense, UK retailers recognize the power of blending in-store, out-of-home, and digital spaces – the oft-cited ‘phygital’ world – that so many consumers now exist within.

This is especially important for grocery, where in-store purchasing still accounts for a hefty portion of sales. Speaking on a podcast last year, Albertsons’ Claire Wyatt explained that retail media investors need to get away from the idea that retail media only leads to e-commerce sales. “Especially in the case of Albertsons, where 97% of our sales still happen in store, that it just is absolutely not the case,” Wyatt explained. “When we think about our own consumer journeys, when I'm at the grocery store, I often have my grocery list on my phone, or I'm looking at Pinterest looking at recipes. So the more sophisticated CPGs, I think, understand that the customer journey is really digitally connected, even if you're in a physical location.”

Go Next-Level on Loyalty

While loyalty programs have existed for decades, UK retailers are well attuned to transforming these initiatives into treasure troves of first-party data. Recent research shows shoppers are open to ads if they are relevant and personalized: 93% say that relevancy of offers influences their purchase decision: 73% report having clicked on an ad when they thought it was relevant and 84% responded to limited-time-only deals. But with 91% saying they already see too many ads online, it’s a fine line to tread. Retail media blended with loyalty data can make it easier for grocers to find the balance and land with precision.
Nectar360, which operates the UK’s most recognized loyalty program, Nectar, has plans to bring tailored advertising to shoppers at Sainsbury’s. The AI-powered personalization technology will enable Nectar360 to present targeted, relevant offers to customers at the end of their shopping journey.
Backed by Nectar’s extensive loyalty data on customer preferences, these offers will appear during online checkout at Sainsbury’s and Argos. These branded spaces allow advertisers to engage directly with customers in a dedicated, immersive environment, increasing brand engagement, personalization and visibility while enabling Sainsbury’s to support its clients’ ecommerce strategies. By combining the targeted personalization of the Nectar Prices loyalty scheme with branded retail media, Sainsbury’s not only enhances customer loyalty but also strengthens its partnerships with brands, delivering a targeted, multi-layered digital experience.
This illustrates how loyalty programs and retail media can powerfully complement each other, especially in grocery – a lesson US-based grocers could pay close attention to.