Research has shown that digital signage can increase quick service restaurant sales by up to 38%. Digital menu boards facilitate upselling and can enhance customer experience in multiple ways, but you can extract even more value from your screens by leveraging them as part of a retail media network (RMN).
RMNs are advertising platforms owned by retailers, turning each screen in your store into a powerful tool for driving sales, either by displaying your own ads or selling the space to other advertisers.
This raises the question: How much value could an RMN add to your quick-service restaurant (QSR)?
To explore this potential, consider what an RMN could look like in your own locations. Here are some key factors to evaluate when determining if an RMN aligns with your business goals.
Technology
When considering the launch of an RMN, it's important to assess the technology you'll need. You may have some of the essential components in place, like point-of-sale systems, digital menu boards, and drive-thru kiosks.
However, many QSRs operate with disconnected technology systems that don’t communicate with each other. This can be problematic, as much of the value in RMNs lies in data integration. To maximize the impact of the content displayed on your screens, it's essential to leverage first-party customer data.
You’ll also need to ensure you have the right network infrastructure. This could involve upgrading your WiFi or installing a custom network to support your new RMN.
Ultimately, your RMN should be integrated across all customer-facing screens in your restaurants. Without this cohesion, data silos and missed opportunities may diminish potential returns. That’s why it could be worthwhile to consider an upgrade to your in-store tech stack with the goal of supporting a successful RMN.
Traffic
Another key factor to consider is the level of foot traffic your QSRs receive. This will help you decide how long it will take to generate a return on your RMN investment. The more traffic you have, the sooner you should reach profitability.
RMNs are a tool designed to maximize the value from the customers who already visit your locations. If your foot traffic is limited, it may be worth reconsidering whether an RMN is the right move at this time.
In this scenario, leveraging existing RMNs beyond your locations can help drive traffic. For instance, advertising on the RMN at the neighboring superstore puts your brand in front of a fresh audience of potential customers nearby.
Customer Data
Customer data and demographics will play a huge role in determining whether your RMN investment fails or succeeds. To unlock its full potential, you need to collect, analyze, and leverage this information effectively.
For instance, tracking customer order data can reveal which side items are most popular with your best-selling meals. With this insight, you can leverage your RMN to advertise those side items during future transactions. This type of personalized upselling can increase the average amount you earn from each customer your QSR serves.
You can use similar strategies to personalize content and messaging based on:
- The time of day that a customer visits
- Where a customer orders (such as in the drive-thru vs. your app, or counter)
- Whether a customer is a loyalty club member
- Limited-time offers and promotions
Some QSRs also explore cross-promotions with complementary brands. For example, partnering with a nearby movie theater that customers may frequent to promote each other's offerings can help drive additional foot traffic.
It’s important to mention that understanding consumer demographics is crucial for maximizing the impact of your RMN investment. Demographics such as gender, age, income level, and lifestyle preferences help tailor content and promotions to resonate with the right audience at the right time. For instance, Gen Z customers may respond better to digital-exclusive deals, while families might appreciate bundled meal promotions.
By aligning your RMN strategy with data and demographic trends, you can craft more effective messaging, optimize ad placements, and drive higher engagement–and revenue.
Message and Channel
The final key to a successful RMN is delivering the right content at the right moment. The goal is to drive sales without disrupting the customer experience.
For example, advertising an upsell item while a customer is already paying for their order is more likely to cause frustration than increase profits. However, displaying an ad for your donuts near the coffee station is more likely to resonate with customers.
When showcasing ads for other brands, it's important that they're relevant to your audience. An ad for a high-end athleisure brand could work at a health-driven café counter but would likely be out of place in a fast-food drive-thru.
While you may not have all the answers regarding messaging and channel strategy right away, this is where customer data becomes invaluable. It provides insights into when, where, and how to display content based on past customer behavior.
What Should QSRs Do First To Get Started?
If you’re ready to pursue RMN opportunities, here’s a quick overview of how to get started:
- Audit existing tech and data capabilities: Ensure you have connected, reliable infrastructure to support a successful RMN launch.
- Define customer segments: Identify key customer behaviors, such as who's ordering, when, and how they interact with your brand.
- Test with external RMNs: Experiment with ads on existing RMNs (like Walmart Connect) before committing the funding to launch your internal network.
- Start with a pilot: Launching an internal RMN on a smaller scale allows you to gather valuable data for efficient and effective scaling.
- Focus on monetization: Assess the potential for generating revenue from the new ad inventory. Market research before launch can help determine possible earnings.
While this process may seem complex, you don't have to navigate it alone. Partnering with an experienced RMN provider like Creative Realities can help you side-step common problems and find success faster.
The Bottom Line: Should Your QSR Invest in a Retail Media Network?
The RMN industry is still in its early stages, making now an opportune time for QSRs to consider investing. Establishing an RMN now could position your business as a leader in this emerging market.
Creating your own RMN platform could be the next phase of your QSR’s growth story, but careful execution will be key to its success. To make the most of this opportunity, you'll need a reliable tech stack, customer data strategies, and effective monetization plans. Get in touch with Creative Realities to learn more about how we can help.
