Retail media—digital displays at the gas pump and in the store—and retail media networks (RMNs)—which incorporate other touchpoints, such as social media, along with a data-heavy approach to advertising—are redefining the c-store experience. Although scale is an advantage, retail media networks aren’t just for the big players. Small operators can join retail media network pools or take inspiration from the most developed operators and implement their own version, picking and choosing whatever elements work for them.

“There’s an approximately 100-store convenience chain that’s doing a version of a retail media network quite well,” said Art Sebastian, CEO of convenience advisory firm NexChapter and former VP of digital shopping and e-commerce at Casey’s. “I even know of a chain with stores numbering in the single digits whose version of a retail media network is, surprisingly, punching above its weight.”

“Retail media is exploding across all of retailing,” added Sebastian, “Across the 30 [CPG] brands I spoke with for a recent consulting project, retail media was a top priority for them.”

Retail giants like Amazon lead the way with the majority share of the some $56.5 billion projected to be spent on retail media in the United States this year alone, according to Coresight Research. But convenience retailers have stepped up to implement or adopt retail media networks in major ways in recent years, with Casey’s, Wawa and 7-Eleven being some of the early adopters driving the market. The vast volume of data collected from their loyalty programs and expansive physical footprints make ad placement across their networks attractive to advertisers.

“Retail media is exploding across all of retailing.”

C-Store’s Unique Value for RMN

Though retail media networks originally took off among big box retailers like Walmart and Kroger, c-stores are particularly well-positioned to establish retail media networks and attract ad spend.

For one, c-stores offer the closest potential distance from ad impression to transaction, Sebastian said. Out of all types of retail, “C-store shoppers are the most open to impulse purchases and receptiveness to inspiration during their visits,” explained Amber Roberts, the partnership director of Threefold, a retail media network specialist in the United States and UK. In fact, she noted, an NCSolutions survey found that 71% of shoppers discover new products and brands in convenience stores.

Since stores have small footprints, customers are not only unlikely to miss a digital sign in a store, Roberts continued, but the sign will likely play a role in decision-making while viewing it.

Frequency of visits, which is higher among c-store customers than almost any other category of retail, also means that users are subject to repeat ads. “According to data Threefold collects via our proprietary Plan-Apps technology, we know that it typically takes three to five interactions to drive a shopper’s purchase, meaning convenience has the opportunity to achieve this in a shorter time frame than, say, grocery,” said Roberts.

How to Build It

Whether you are building your own retail media network, adopting and integrating one from a provider or looking for inspiration and ideas, experts said there are four main components of an RMN to consider:

“I even know of a chain with stores numbering in the single digits whose version of a retail media network is, surprisingly, punching above its weight.”

1. Collecting Customer Data

Data is the cornerstone of RMNs, and first-party data from loyalty programs is a good place to start, sources agreed. Whereas the Walmart’s of the retail world rely heavily on e-commerce and online shopping data to inform a retail media network strategy, explained John Mercer, head of global research for Coresight Research, c-stores traditionally represent a “black hole” of data considering the limitations of tracking individual in-store purchases—but loyalty programs help retailers gather this critical data.

“First and foremost, retailers need to focus on building their addressable audience through their loyalty programs,” said Patrick Raycroft, CEO and co-founder of Axonet, which aggregates first-party c-store data with media touchpoints to form aggregated retail media networks. “Loyalty programs help retailers better understand their audience so they can then improve value exchange through meaningful offers and content.”

As much data as possible should be gathered from opted-in users, and then unified to paint a complete picture. “Build your first-party data and make sure it’s organized, enriched and unified. [Retailers] tell us their transactions, their pump interactions, their website interactions, their social media activity and their call center activity,” Raycroft continued. “We then need to unify all that.”

Operators can also analyze foot traffic to determine how frequently customers typically enter the store, how they move about it and how long they shop by gathering data from CCTV analysis (which can be aided by AI) and by offering and tracking usage of free in-store Wi-Fi.

Inside the store, digital signage is the most important, and perhaps most obvious, component of an RMN.

2. Unique and Engaging Ad Inventory

The second most important step is to create unique advertising inventory, Sebastian said. The main goal of an RMN is to offer an omnichannel platform for other companies to advertise to your customers. But it’s also crucial for retailers to own and control that inventory and to ensure their own ad placements factor in, Sebastian said.

“Retailers will lean on providers to monetize their ad inventory, but if they don’t own and control their ad inventory, they will struggle to monetize effectively,” Raycroft said.

Sebastian pointed to retailers that have superb ad inventory and integrate it well into their RMNs, citing Casey’s, which excels at its mobile app advertisements for its pizza business; Wawa, which makes ads for its hoagies a big part of its in-store digital kiosk displays; and a client of Sebastian’s who he said has done an amazing job with its YouTube channel despite not being a huge player. “You have to have that [ad] inventory, and you have to make it unique and interesting.”

3. Touchpoints

Where to place ads is the next-most important factor in an RMN strategy. Marketers are drawn to RMNs because their ads can be placed across multiple touchpoints along the entire journey of a user: from online and in-app activity to fuel pump screens, to signs in the forecourt, to the locations in stores where users are most likely to decide to make a purchase and more.

7-Eleven focuses heavily on social media to target Gen Z consumers. “Our organic social channels are focused on engagement and follower growth, specifically tapping into the Gen Z audience,” Mario Mijares, 7-Eleven’s VP of customer insights, loyalty and personalization, told NACS. “By connecting on the social media channels they’re most comfortable with, we can create a consistent message that’s echoed in our advertising campaigns, in our 7Rewards and Speedy Rewards apps and in our at-the-pump and in-store messaging.”

And all of those touchpoints must present a unified message. “As a user, what I saw at the fuel pump should complement what I saw in the email I got yesterday and then what I see in the menu bar,” Sebastian said. “It’s that 360-degree messaging that makes an RMN so powerful in influencing me to make a purchase.”

At the Pump

But what about the customers who never step foot in the store?

At-the-pump advertising offers a unique opportunity to target consumers who are typically a captive audience with few distractions for a few minutes while they fill up, Roberts said. And since everyone from business travelers to high-school students need to get fuel, the demographic reach at the pump is broad.

“I’m a huge fan of unlocking the fuel pump screens to drive inside sales,” Sebastian said.

Rather than just pushing ads about the items in store, extensive A/B tests Sebastian has been a part of have indicated that it’s better for pump screens to include a blend of engaging content such as local news, weather, sports content and other regional-specific programming. He also said retailers should incorporate messaging about their company itself “to tell customers who you are and drive brand love and affinity,” which is more likely to get customers to return when they do need something inside.

Since some fuel customers still won’t enter the store, not every advertisement needs to be related to the in-store offer. If it’s feasible, integrate a wide variety of non-supplier brands’ advertising into the retail media network strategy as well, Roberts advised. The pump is a good place to reach drivers with messaging from tangential brands such as insurance companies offering discounts and automotive service providers reminding drivers to take care of their vehicles.

Inside the Store

Inside the store, digital signage is the most important, and perhaps most obvious, component of an RMN. But where, exactly, should digital signage be placed? “With smaller-scale stores, it can be easier to track a shopper’s journey from entry to exit, and with that, know when and how to best reach them,” Roberts said.

In-store radio can be another link in the RMN chain, blending music with radio ads while the customer shops. The companies that operate these in-store radio stations can integrate them with a broader RMN, Sebastian explained. 7-Eleven is a leader in the radio niche with Gulp Radio, an in-store radio network in nearly 2,000 7-Eleven and Speedway stores, according to 7-Eleven’s Mijares. “Gulp Radio will operate across our entire footprint by 2025 and at that time will be the largest radio network in the United States.”

Regardless of how many touchpoints you put in place, they all need to work in harmony with one another, Raycroft stressed. “Retailers need to focus on building the right touchpoints at their stores that deliver meaningful outcomes for advertisers,” he said. “But retailers also need the right technology. If a digital sign requires manual content management rather than being a part of a network of signs and ads that are managed centrally, then it doesn’t meet the functional needs of an RMN.”

Retailers need rich first-party customer data, so that they aren’t sending a personalized offer through their loyalty app for one energy drink brand to someone who exclusively drinks another, Sebastian said. Conversely, you can’t personalize in-store signage, such as a menu board, for each customer, he continued. “However, a good RMN has a strategy in place for ‘collision management,’” he said. “You don’t want Red Bull on the fuel pump screen and Monster on the menu board. You have to have consistency across all your platforms.”

“There’s a path forward for every retailer.”

4. Strategy

Lastly, a 360-degree, comprehensive strategy across the entire network is crucial. “Building a retail media network isn’t about just grabbing dollars,” Sebastian said. “It’s about creating a seamless experience for your customer to help the CPGs see the return on investment on their ad spend. If they see return, they’ll invest more. If they don’t, they’re going to pare it back.”

“Being able to correlate what media was out in the world with the actual sales of the product in question, or ‘attribution,’ and ‘closed loop measurement’ is key,” Sebastian continued. “If we’re promoting Red Bull at the pump and on the menu board, are we seeing a spike in Red Bull sales versus when we just promoted it at one or the other? A good RMN [strategy] involves running A/B tests to start to deduce a 5% lift here or a 10% lift there, and then you start breaking it down further to ask, ‘Is that lift driven by existing customers buying more frequently or buying more per trip? Or did we actually acquire new customers into this category?’”

To paint a picture, he said, stores with sophisticated RMNs know that User 817890 was exposed to X, Y and Z ad impressions and they then purchased products from those suppliers within a seven-day window, for example.

“C-store shoppers are the most open to impulse purchases and receptiveness to inspiration during their visits.”

RMN Aggregators

To gather and optimize data into useful ad spend decisions, the network must be massive. “Media buyers have stringent requirements that retail media networks must meet in order for them to spend on RMNs,” Raycroft noted. “The size of unique, addressable audience—with estimates at six to 11 million unique, addressable, opted-in members—is one key factor, and a distribution of that audience across a national footprint is important too. Because of the fragmentation in the U.S. c-store market, all but the largest of c-store chains cannot meet these requirements.”

For that reason, there’s a growing—albeit slowly—space for RMN aggregators that can help smaller store chains utilize a network Sebastian explained. “If you’re a retailer, you can join an aggregated network where advertisers are already spending, but you have to participate in revenue share and you lose control.”

Aggregation is not limited to just smaller chains, though, Raycroft said. Volume of data is a critical challenge for the vast majority of convenience retailers.

Despite challenges, “There’s a path forward for every retailer,” Sebastian concluded. “It doesn’t matter your size. Every c-store retailer can participate in this space, and I think they should.”

Raycroft concurred. “We don’t think there’s a do-nothing option for c-stores. Retail media is changing retail economics. CPG brands are changing the way they spend money—shifting ad spend to performant, measurable media over traditional, analog media.”