Gadi Graus, CEO of A2Z Cust2Mate.
getty
Historically, retailers predicated their operations on the once-reliable and straightforward marketing funnel. They built everything around this because, despite consumer complexity, the underlying behavior model was easy to understand and mostly consistent.
The modern shopper is disrupting this model entirely and creating an increasingly intelligent consumer journey. They are discovering products through social media, asking AI for recommendations, reading reviews while standing in a store and using their phones to validate purchasing decisions. This means retailers need to think beyond the traditional funnel and deploy new opportunities to respond to this new behavior in real time or risk losing visibility into, and influence over, the customer journey.
The Store As An Intelligent Touchpoint
With this contemporary behavior, the value of each consumer touchpoint depends on how well it works with the rest of the customer experience. A website should understand the store; a loyalty program should inform the shopping experience; inventory systems should influence digital recommendations. This means the physical store can no longer be a data blind spot.
While consumers can research virtually anywhere, brick-and-mortar locations allow them to see and touch products, compare them and take them home immediately. But recent research (download required) from my company shows that shoppers are now bringing digital expectations into that environment. They want information immediately, even when they are standing in an aisle.
Retailers can now use technology (registration required) to make physical stores more intelligent, responsive and connected. Technologies such as AI, computer vision, smart carts, connected devices and sensors can not only support customers throughout their journey but also create visibility into behavior that was previously difficult to understand—providing context around a decision rather than simply recording its outcome. When stores connect these insights with inventory, loyalty, e-commerce and transaction data, they can become an intelligent touchpoint within the broader consumer journey.
This allows retailers to see what consumers are doing in the moment, moving from personalization based on history to informing it by context and intent. A shopper’s current activity may be more relevant to a decision than something they purchased six months earlier. This increased knowledge allows retailers an opportunity to provide information or assistance while that decision is still taking shape. The same shift is transforming retail media.
Retail Media Is Becoming Part Of The Decision
Traditional in-store advertising was largely static. Signage, displays and endcaps could influence consumers, but retailers had limited ability to understand precisely who engaged with them or what role they played in a purchase. Digital retail media has changed that model by introducing targeting, personalization and measurement. As brick-and-mortar locations become more connected, I’ve seen that those capabilities are increasingly extending into the store itself.
This enables retail media to move closer to the actual moment of decision. Instead of simply delivering an impression, intelligent systems can use context to determine what information may be relevant to a shopper at a particular point in the journey. If retailers can find ways to connect this engagement to transaction outcomes, retailers and brands can also begin to understand which interactions contribute to purchasing behavior. That can create a feedback loop between media exposure, in-store behavior and sales that has historically been difficult to establish inside the physical store.
Retail media therefore becomes part of the broader intelligence layer connecting marketing and commerce instead of just another advertising channel.
Challenges And Considerations
But, the challenge is that consumers already have more information competing for their attention than they can reasonably process. Intelligent retail media needs to improve relevance and usefulness while creating measurable value for brands and retailers to be impactful.
Consumers have always been influenced by factors outside a retailer’s control. What has changed is the scale, speed and intelligence of those influences. Trying to control every influence is neither realistic nor desirable. The more productive strategy is to understand how those influences interact and ensure that the retailer can participate meaningfully wherever the decision is taking shape.
What Retailers Should Do Next
This participation can start with connecting the journey. Loyalty, digital, transaction and in-store signals should work together rather than being treated as separate experiences. The more connected the channels, the clearer the picture of how consumers move from discovery to decision. Retailers should move beyond designing for history and start around context. Past purchases and customer profiles remain valuable, but what a shopper is doing right now can be just as important. Using real-time context and intent alongside historical data can make interactions more relevant while a decision is still taking shape.
Finally, retailers should measure influence through to outcomes. Engagement should not be the endpoint. Connecting interactions and experiences with purchasing behavior can help retailers understand which touchpoints actually influence decisions and create value for both consumers and brands.
As intelligent systems become more deeply embedded in discovery, evaluation and commerce, and physical stores become more connected, retailers should think beyond the traditional funnel and deploy new opportunities to understand behavior and respond to it in real time.
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