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United Airlines' retail media offering shows why RMNs aren't just a retail thing

United Airlines' retail media offering shows why RMNs aren't just a retail thing

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An industry first, United Airlines has decided to embrace “retail media” like solutions, and launched its own media network that taps on insights from travel behaviours to offer connected customers personalised, real-time advertising, content, experiences from leading brands.

Don't miss: United Airlines launches industry-first media network to enhance ads served to passengers

The new platform gives marketers the opportunity to scale their reach across a wide range of channels including United's mobile app and inflight entertainment screens. While advertisers cannot access the personally identifiable information, United Airlines’ media and sales partner can leverage insights of US customers aged 18 and over to create aggregated and anonymised audience segments to offer to interested advertisers.

In a nutshell, retail media networks have quickly risen up the ranks of importance in the marketing world given that retail ecosystems that leverage first-party transaction data to personalise ads, target audiences, and deliver full-funnel impact for advertisers, while enabling closed-loop measurements.

And while commonly associated with retailers or etailers, as the move by United Airlines shows, the concept of a retail media network doesn’t necessarily need to be confined in that zone alone.

Ken Mandel, regional managing director of GrabAds and Brand Insights, said that today retail media networks or RMNs have evolved far beyond the traditional retail players and are emerging across sectors. These include sectors such as automotive, fashion, financial services, home improvement, hospitality, and many other areas.

Retail was the first domino to drop but more industries will follow suit over the next few months and years.

What will it take for non-retail brands to be successful?

But for brands to truly be successful in this space, the need to have a sizeable and frequent audience, access to first-party data and the ability to close the loop between advertising and sales. Last but not least, they need the right skill sets to succeed in the advertising space.

The biggest challenge, Mandel added is the frequency of consumer engagement. “Successful retail media networks typically have high engagement rates, with consumers interacting on a weekly or even daily basis,” he said.

"Outside of very frequent travellers, United Airlines may not have a vast opportunity here. However, given the high margins of advertising and the lower margins of airlines, United can reinvest retail media networks profits to enhance passenger experiences," he added.

For platform owners with ambitions to transform into a retail media channel in their own right, the first mover advantage within their category is going to be a significant predictor of success, explained Uma Ranganathan, head of solutions development, dentsu Singapore. The learning curve of such business transformative exercises is getting shorter as businesses learn and adapt from their predecessors in other categories.

Like Mandel, she said, the challenge that these companies can expect include possibility of high attribution but low commerce conversion, given that the inventory of this retail media network is primarily leveraging a non-commerce environment for the advertising brands.

“The attention-retention conundrum that plagues all forms of media will be true of this channel as well,” said Ranganathan added. She added that the onus of communication effectiveness is a shared responsibility of “strategic consumer insights and creative execution”.

She also added that proper inventory and pricing will be critical for the retail media channels, as will be the demand to keep the operational costs low and delivery optimisation high.

A balancing act

Sectors such as travel, hospitality, and retail, which have frequent customer interactions and access to rich data, are particularly well-positioned to benefit but technological integration can be complex and costly, and there are significant concerns around data privacy and security when handling passenger data, explained Martin Davie, head of performance APAC, Publicis Media.

While these industries can leverage their customer touchpoints to deliver targeted and relevant advertising, enhancing engagement and generating additional revenue, they must keep priority and experience top of mind.

“It is crucial to ensure that ads enhance rather than detract from the customer experience. This requires a delicate balance between commercial and passenger interests,” Davie said, adding transparency and trust are critical.

“Consumers need to feel confident that their data is being used responsibly and that advertisements genuinely add value to their experience. Maintaining this trust will also be essential for the success of retail media initiatives,” Davie added.

Join us this coming 26 June for Content360 Hong Kong, a one-day-two-streams extravaganza under the theme of "Content that captivates". Get together with our fellow marketers to learn about AI in content creation, integration of content with commerce and cross-border targeting, and find the recipe for success within the content marketing world! 

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