In an era where artificial intelligence is reshaping consumer interactions, retailers hold a strong advantage in developing specialized AI-powered experiences, particularly in verticals like grocery and electronics, according to Roger Dunn, Global Retail Media Lead at Diageo.
Dunn highlights that retailers are uniquely positioned to create vertical-specific chat interfaces that deliver highly relevant, context-aware shopping journeys. These tailored AI tools could unlock innovative advertising formats, including sponsored conversations and personalized product recommendations, opening fresh monetization avenues.
“There’ll be a need to have those chat interfaces that are very specific to those verticals, and that’s where they can monetize them and create new ad units,” Dunn explains.
For brands like Diageo—the world’s leading premium drinks company with iconic portfolios including Johnnie Walker, Guinness, Smirnoff, and Don Julio—the immediate focus remains on visibility. Dunn stresses the growing importance of monitoring how brands appear in large language models (LLMs) and AI-driven search results.
“The most obvious initial one is knowing how your brands are surfacing in some of these LLMs,” he says, noting increased efforts to track mentions, recommendations, and overall presence within these emerging systems.
While paid AI advertising opportunities are likely to emerge, Dunn draws parallels to the evolution of retail media itself. Success will hinge on core principles: transparency, robust measurement, and demonstrable value. These fundamentals, he believes, will separate winning retail media networks from the rest.
Dunn also reflects on the funding dynamics within retail media, where budgets can draw from traditional marketing (brand or performance), shopper marketing, or even commercial trade spend embedded in broader retailer agreements.
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He recalls how retail media transformed from a bundled, unsophisticated element in commercial deals to a standalone, high-value channel. “In the past, it would be us selling product to a retailer that’s buying it, but now the retailer is selling media and Diageo is buying it,” Dunn observes. “It’s a complete flip of the relationship.”
When evaluating partners, Diageo assesses retailers on their maturity as media owners—focusing on quality assets, rich data, and—most critically—advanced measurement capabilities. “As with any marketing, but especially with retail media, because it’s so measurable and it has that closed loop reporting, you need to know it’s going to work,” he emphasizes.
Retailers lacking strong data and proven effectiveness rank lower in priority. “You just have to follow your nose in terms of where you’re going to get measurable results, because it is inherently a measurable media channel,” Dunn concludes.
As AI continues to accelerate changes in commerce, Dunn’s insights underscore the need for brands and retailers to collaborate on transparent, results-driven strategies to capitalize on the next wave of opportunities.
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