In an advertising ecosystem fixated on digital channels, it can be surprising to learn that a major retailer’s media strategy is overwhelmingly centered on its physical footprint. For UK grocery chain Co-op, about 80% of its retail media business is rooted in its brick-and-mortar stores, making them the undisputed core of its commercial engine.
This physical-first approach presents a unique perspective on the omnichannel challenge.
In this video interview with Beet.TV, Rachel Halter, director of membership and CRM, Co-op, says she believes the influence of in-store media extends far beyond the checkout line, creating brand recall that benefits advertisers even after a customer has left the building.
Proving the power of in-store media
While the advertising industry has seen explosive growth in online retail media, projected to capture over 20% of total digital ad spending by 2029 according to eMarketer, Halter explained that Co-op’s strategy has remained firmly grounded in its physical estate.
“Interestingly here in the UK, the physical stores have always been the absolute central hub of our retail media strategy,” Halter said. “It’s more with brands, how do they see stores always being part of their marketing campaigns and their channel mix.”
To prove that value, Halter pointed to recent research conducted with attention measurement firm Lumen. The study showed that in-store advertising not only lifted sales at Co-op, but also at its competitors. “It also drove sales in competitor stores of the products,” she explained. “So it showed that there was recall still happening and we could demonstrate that and absolutely prove that with data.”
Consistency, not carbon copies
Co-op has continued to invest in its digital services, such as its Co-op Health app for prescription management, but Halter emphasized that each channel must play to its own strengths.
“It’s about making them consistent and talk to each other as channels, but being really clear about what each channel, what the job is there for that that it needs to do for you and for your campaign,” she said.
The unique advantage of brick-and-mortar, Halter added, is its ability to offer tangible experiences. “Nothing is quite the same as marketing that you can touch, potentially smell, feel in the in-store environment,” she said. “So I think my overarching thing would be consistency, but adapting that consistent creative to the channel that you’re in.”
Starting with the physical world
Halter believes that retailers with deep roots in physical commerce have an advantage when building out an omnichannel strategy. For Co-op, its member-owned structure and local presence provide a strong foundation from which to extend into the digital realm.
“It’s much easier then to connect back out from the physical world to the digital than it is the other way around,” Halter said. “It’s quite difficult to think when you’ve worked in a purely digital environment, how do I translate that into the store? My personal view is that it’s much easier to do it backwards.”
Social media and first-party member data are crucial for bridging that gap, she noted, creating a loop that brings online engagement back into the store. As an example, she cited a recent campaign for a new candy brand launched by a popular YouTuber, where online buzz was leveraged to drive significant in-store traffic. “Social and first-party data is a really vital connect between what’s happening in our stores, in the digital world, and then bringing them back into the physical world,” Halter said.
