IIn an exclusive interview with Ken Mandel, the Regional Managing Director and Head of GrabAds & Brand Insights at Grab, we explore the dynamic landscape of Retail Media Networks (RMNs) in Southeast Asia. With over 25 years of experience in the digital industry, Ken Mandel provides valuable insights into the factors driving the rapid growth of RMNs in the region, the distinctive features of superapp RMNs, and effective strategies for marketers to leverage these powerful advertising platforms. As a leader in the advertising, media, and technology sectors, Ken Mandel’s expertise sheds light on the evolving role of RMNs and their impact on consumer engagement and ad effectiveness.
Ken’s current remit at Grab is an eclectic accumulation of almost everything he has done in his 25 years in the industry. His vision for GrabAds is to support brands with offerings that span the full marketing funnel, enable marketers with deep insights into their customers’ behaviors and preferences, and help drive the ‘last click to the last mile’ for brands via the Grab platform. Ken has held various C-level positions across the Asia Pacific region at leading advertising, marketing, and technology companies, including building XM Asia Pacific into one of the region’s leading digital consultancies and establishing Yahoo!’s advertising product line across Asia Pacific.
Can you elaborate on the key factors driving the rapid growth of Retail Media Networks (RMNs) in Southeast Asia compared to other regions?
The market dynamics and business landscape within Southeast Asia make it a fertile ground for the development of RMNs. The sentiment is consistent with the data from GrabAds’ recent study with Kantar, which looked at the state of RMNs in Southeast Asia specifically. The year-on-year growth in total advertising (ad) spend on RMNs in Southeast Asia is forecasted to increase from 8% in 2024 to 11% in 2030[1], which is higher or consistent with global growth figures.
A key factor driving the rapid growth of RMNs in Southeast Asia is its booming digital economy and tech-savvy population, accustomed to mobile-first convenience. With smartphones as their primary device, consumers are looking for seamless, convenient retail experiences that are quick and efficient. Furthermore, Southeast Asia has no shortage of retail options, with many shops readily accessible. Consumers are used to being able to get what they need at a moment’s notice. The same Kantar study noted that 2 out of 3 Southeast Asians surveyed prioritise on-demand access to products and services[2]. The need for such demands has given rise to the adoption and importance of superapp RMNs like GrabAds in consumers’ daily lives; hence, they are well-positioned to seamlessly bridge the experience from discovery to purchase and delivery of products into the hands of consumers.
How do superapp RMNs differentiate themselves from other types of RMNs in terms of consumer engagement and ad effectiveness?
The Kantar study noted that 1 in 2 Southeast Asians utilises superapps for daily online and offline activities[3]. Superapp RMNs are unique as their ecosystem of services allow curated ads to be served at different purchase stages and types of services. Other types of RMNs, whether social media, e-commerce or large retailers, identified in the same Kantar study, typically cover only 1 or 2 purchase stages. Because of their wide-ranging ecosystem, superapp RMNs allow advertisers to reach the region’s increasingly hybrid shoppers across their buying journey.
Due to its nature, superapp RMNs are built for omnicommerce. What this means is that they can create hyper-personalised consumer touchpoints. For instance, by offering an integrated payment system that captures offline and online transactions, superapp RMNs can drive traffic to advertisers’ physical stores through digital recommendations and promotions, prompting offline transactions to be tracked via the platform. Furthermore, they can offer out-of-home assets like product sampling or car fleet wraps that enable retailers to deliver an integrated campaign across multiple channels. This is key to improving positive ad receptivity, as our study with Kantar finds a 5% improvement in consumers’ receptiveness to ads[4] when delivered through both online and offline channels.
In what ways do RMNs enhance the advertising experience for consumers, and how does this translate into higher ad equity compared to traditional media channels?
RMNs are powered by first-party transaction data, allowing advertisers to serve highly relevant ads to consumers catered to their needs and behaviours across different stages of their buying journey. What this essentially means is that RMN ads capture consumers who are already in a buying or discovery mindset and provide suitable product solutions in the right context, at the right time. RMN ads therefore add value to the browsing experience, rather than disrupt it. This results in greater receptivity towards RMN ads, which are perceived to be less intrusive and more trustworthy, according to the Kantar Media Reaction 2022 report.
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In fact, our study with Kantar shows that RMNs ranked first in online media channel ad equity, which looks at consumers’ receptiveness to advertising messages across online media channels. According to the Kantar Media Reaction 2022 study, campaigns are 7 times more effective on media channels with positive ad equity.
What strategies should marketers adopt to effectively leverage the unique features of RMNs, particularly in the context of Southeast Asia’s diverse and rapidly evolving market?
Marketers should first aim to be timely and relevant by leveraging the first-party transaction data on RMNs to anticipate consumers’ needs. With this data, brands can serve personalised messages to consumers at the right moment when their product or service is most in need to drive meaningful engagement. In the eyes of consumers, this elevates not only the relevance of a brand’s product or service but also favourably positions it as being functional and useful.
Another strategy that should not be overlooked would be to go full funnel. Marketers should harness RMNs’ omnichannel nature to extend their brands’ reach beyond digital through both offline and online touchpoints. Moreover, the end-to-end ecosystem of RMNs also allows brands to measure and optimise campaign outcomes at each stage of the consumer journey, from awareness to advocacy. A common misunderstanding among advertisers is that RMNs are purely a performance channel. RMN ads indeed drive performance – or what we call bottom-funnel – because of their ability to help advertisers ‘close the loop’ between consumer intent and purchase. But that is not all they can do. Our latest 2023 Food and Grocery Trends report revealed that 66% of consumers come to Grab without a specific store in mind, while 91% of them have used the Grab app to discover new restaurants or stores. This in itself shows that superapp RMNs are not only bottom-funnel but provide a full-funnel solution for brands.
Creativity is a key aspect that sets brands apart. Consumers today are inundated with a plethora of ad campaigns, and brands need to create unique, immersive experiences to surprise and delight consumers. This is achievable through the diverse online and offline ad formats offered by RMNs, allowing marketers to seamlessly connect both spaces for a unified consumer journey and experience, driving effective awareness and discovery campaigns. For example, we worked with Wonda Coffee to create a complete sensorial experience for users. 3D coffee cans were placed on top of Grab cars, and users were greeted with the Wonda jingle and the scent of roasted coffee beans in the cars. An in-car QR code was also presented for users to get a free can of coffee.
How do you foresee the role of first-party transaction data evolving in the future of RMN advertising, and what impact will this have on consumer privacy and data security?
First-party data transactions in RMNs will propel growth for advertisers seeking targeted and effective campaigns. First-party data in RMNs are based on real consumer transactions, allowing advertisers to provide information that is relevant to their target audience’s needs. With more reliable data, advertisers can create more targeted ads to drive performance and brand-building objectives. For example, a quick-service restaurant can elect to show ads to people who purchased fast food in the past 30 days based on the transaction data provided by RMNs.
Creating such advantages for both users and advertisers also means that platforms like ours have a responsibility to leverage first-party data transactions in a responsible manner.
As a leading RMN in the region, GrabAds is committed to our guiding principles that include ensuring our compliance with the applicable privacy laws and sector-specific requirements imposed by regulators, with operations that fully comply with Grab’s data privacy policy. Through the Grab app, advertisers can target campaigns based on first-party data insights, which are aggregated and anonymised audience segments. Meanwhile, all users on the Grab app can limit the use of their personal data to display targeted advertisements on behalf of our advertisers, by adjusting their preferences through the app.
Ken Mandel’s extensive experience and innovative approach to advertising through superapp RMNs highlight the transformative potential of these networks in Southeast Asia. As the digital economy continues to expand, the insights shared by Ken offer a roadmap for marketers to navigate this rapidly evolving landscape. By harnessing the power of first-party transaction data and leveraging the unique capabilities of superapp RMNs, brands can create highly personalized and effective advertising campaigns that resonate with consumers. With a commitment to privacy and data security, GrabAds is poised to lead the way in delivering impactful advertising solutions that drive growth and engagement in the region.
