Image Courtesy of Grocery TV
December 17, 2024
Will Hy-Vee’s Digital Screens Inform or Annoy In-Store Shoppers?
Hy-Vee announced plans to install more than 10,000 screens across its over 400 locations to help vendors and other potential advertisers “reach millions of shoppers across Hy-Vee’s stores with high-impact digital advertising.”
Hy-Vee’s advertisers are also promised to gain “greater audience targeting and campaign measurement capabilities.”
As part of its partnership with Grocery TV, the screens will be placed at the entrance, checkout, service departments, aisles, and end caps of each Hy-Vee store.
In-store media’s growth potential has long been touted given its ability to reach consumers at the point of purchase, with the vast majority of sales still taking place at physical stores, particularly in the grocery channel.
U.S. in-store media is projected to nearly triple from 2024 to 2028, although it will still account for only 0.8% of overall retail media spend by 2028, according to eMarketer.
One factor holding back in-store media’s growth is that digital ads’ effectiveness in driving sales remains harder to measure compared with online ads, according to the Wall Street Journal. In-store ad provider Vibenomics recently partnered with measurement firm Pathformance to overcome the “inconsistent measurement methods and fragmented data sources” currently supporting in-store measurement tools.
The other major obstacle is a lack of in-store screens.
An eMarketer survey of about 1,200 U.S. adults in collaboration with Placer.ai found that 74.6% of consumers have encountered in-store media formats like digital screens on cooler doors, TV walls, or in-store radio.
The most common format respondents encountered was ads on televisions merchandised in-store, at 52.8%, and the ads were generally found to be effective. Consumers ranked ads on TVs as the most memorable (40.7%) and favorable (67.7%) format. Of the respondents, 61.6% indicated they had purchased an item showcased in an in-store retail media format.
EMarketer’s study also showed digital signage could enable grocers to engage in-store shoppers with other content.
“In-store retail media is in its early innings, but both retailers and advertisers are motivated by the possibility of reaching shoppers where over 80% of retail sales take place,” eMarketer Analyst Sarah Marzano said. “Upgrading in-store infrastructure and investing in engaging digital formats will be crucial for retailers hoping to unlock the massive potential of in-store retail media.”
Listing in-store media among its five “2025 Consumer Predictions,” Acosta Group called out the retailer app as “the most powerful in-store media tool, combining first party data with in-store traffic insights.”
The marketing agency noted that smart shopping carts are gaining positive feedback from shoppers and could be an alternative to storewide digital screens for retailers.
“In-store retail media options are vast and when executed strategically, seamlessly enrich shoppers’ experiences while increasing trial, loyalty, and unit sales,” said Cody Tusberg, SVP of retail media at Acosta Group. “But a clear understanding of the brand’s objectives and implementation costs is necessary to measure attribution and avoid creating a confusing and overstimulating shopper experience.”
Discussion Questions
Why is retail media ad spending so much higher online than in store?
Will grocery shoppers become comfortable engaging with digital ads on screens in stores?
Poll
Loading …BrainTrust
John Hennessy
Retail and Brand Technology Tailor
David Naumann
Marketing Strategy Lead - Retail, Travel & Distribution, Verizon
Cathy Hotka
Principal, Cathy Hotka & Associates
Recent Discussions
More Discussions
How Can Retailers Crack the Gen Z ‘Riddle’?
Gen Z is becoming an increasingly important consumer demographic, but an elusive one to map. How…Does Bath & Body Works’ Scented Holiday Campaign Pass the Sniff Test?
Bath & Body Works is kicking off a new campaign with scent being at the fore…Which Tech Will Solve In-Store Inventory Woes?
Three major tech lineups are looking to solve retail inventory problems. Which is most suited?
I like it: a low-intrusion way to reach those who want to be reached, while skipping those who don’t…
roadaisle-side billboards even Lady Bird could approve of (props to those who get the reference…and a Lord&Taylor gift cert to those who can explain it to the grandkids.)In store screens don’t have a terrific track record. However, Hy-Vee executes very well with a strong focus on shopper. That gives Hy-Vee a better chance at success.
When doing shipper testing using virtual store environments, screens gained the highest eye tracking minutes. There’s something interesting there. Success will come down to execution.
attribution of a specific sale to any one or more marketing vehicles is really challenging. Was it the digital ad, or the off price offer, or the placement on an end cap that moved the sales needle on an item. I do believe digital media can influence different purchase behavior, give the high percentage of sales that fall into the “impulse” category.
I think online media can be more impactful because the path from seeing to clicking is so seamless. In person, it’s more of a suggestion. Tracking how effective in-store media is could be done by looking at two stores with very similar sales numbers of a particular item and implementing in-store media in one of the stores to see if sales spike. It’s not perfectly controlled, but would give an idea. I don’t think in-store signage is particularly distracting, but I do think there’s more engagement for the shopper when it offers information rather than serves as random promotion.
Retail media still dominates because it can be highly targeted and measured by click through rates. It’s why Google and Meta are astronomically successful. Building out a retail media network in stores takes significant capital investment and it doesn’t have the same kind of targeting precision as online ads do. However, in store media has something online doesn’t – shoppers who can immediately purchase and walk out with goods. So the opportunity exists, but optimizing in-store messages that grab shoppers attention and compel them to purchase is harder than it looks. In-store media can be measured by in-store conversion rates, and especially SKU-level conversion. Once a retailer can quantitively demonstrate SKU conversion, they’ll have brands lining up to pay for exposure.
If the content is silent, it could be very influential. If it’s not silent, expect a wall of complaints.
I think that the digital displays could be impactful but the image highlights the need for them to rethink and overhaul the visual merchandising to reduce and reposition the non-digital signing to minimize the visual clutter. They would also want the messages to be just visual as adding sound would be challenging to manage with different screens competing for their customers’ auditory attention (and I am sure it would also be annoying for the staff).
Hy-Vee’s digital screens are not offensive. Ads on cooler screens – of the type Walgreens once used – are intrusive and annoying. There is a fine line with media in store and the lesson is that it must not disrupt the flow of shopping.
Retail media has been successful online and now is the time to penetrate the store. Online retail media networks are easier to deploy because it doesn’t require a capital investment in monitors and the tracking of clicks to sales makes it possible to measure the ROI. There are some retail media network players that cover the cost of deploying monitors in stores and help navigate the CPG relations to make it very turnkey for retailers with little to no risk. I expect to see more retailers testing in-store retail media networks in 2025.
Where can you go and not encounter a screen? Just. Stop. Putting. Screens. Everywhere. Please.
Will grocery shoppers engage with or be annoyed by these screens? The obvious answer is that it depends (sorry for the cop-out statement). Shoppers who want to get out of the store quickly will never engage and might be annoyed. Other shoppers looking for discounts and information will engage. Retailers will need to monitor the reaction of shoppers and determine if the installation is worthwhile.
If the screens add value to the shopping experience by simplifying or influencing purchasing decisions, rather than creating noise and distractions, they could actually enhance in-store shopping.
This is big news for Hy-Vee, but maybe even bigger for GroceryTV, which is in fierce pursuit to reach a “critical mass” quantity of in-store ad screens at national scale.
In-store video advertising has been a simmering concept since the 1990s, when the Wal-Mart Network was first introduced using CRT monitors. Key lessons learned along the way included: (1) Engage shoppers, but don’t distract them from buying things. (2) Nobody stops to watch content longer than 10 seconds. (3) Forget about using audio – it just makes people mad.
The core premise still holds up, however. In-store audiences, as measured by unique visits per week, are massive and more reliable than audiences on traditional media, like TV. And the proximity of the ad message to the purchase decision (moment of truth) is unbeatable – rivaled only by ads embedded in online shopping.
Selecting The Trade Desk as the demand-side buying platform (DSP) is also a significant move, since CPG advertisers badly need some standard, repeatable practices for retail media buying. Better metrics too. ROAS (return on ad spend) is beginning to look like an inadequate way to gauge success. True ROI must consider sales lift, category impact, margin and shopper loyalty. These first-party data reside within the retailer’s systems. Making them accessible to advertisers is crucially important.
With its investment in in-store screens, Hy-Vee is making a bet that suppliers will derive measurable value in placing ad messages in its stores. I think this may be a tricky proposition for many CPGs, who are bandwidth-challenged when it comes to managing media ad buys at just the few largest RMNs. “Power regionals” like Hy-Vee have to demonstrate ROI and reduce friction if they want to capture a fair share of retail media revenues from brands.
For more on this from the CPG’s perspective, see my recent series in CPGmatters.com: How Are Brands Managing Retail Media Investments?
This represents a meaningful step forward for Hy-Vee, one that reflects an understanding of how people actually shop today—blending online exploration with in-store discovery. It’s not just about slapping screens on the walls; it’s about enhancing the customer’s experience in a way that feels natural. After all, screens are a part of daily life.
By offering well-placed, quick-hit visual messages right at the point of decision, retailers can tap into a huge audience that they know is physically present in their stores. It’s an opportunity to connect with people at the exact moment they’re considering a purchase, providing reminders, suggestions, or inspiration that can genuinely influence what ends up in the cart.