TECHNOLOGY
Marketing Innovation
Kroger
Other retailers won’t be outdone by Walmart’s media efforts. The Kroger Co.’s Kroger Precision Marketing launched in 2017 under its 84.51° data science subsidiary. Earlier this year, the Cincinnati-based retailer introduced a new sales attribution capability powered by Microsoft PromoteIQ to provide brands full transparency into media performance for in-store and online sales results attributed to advertising campaigns. Kroger and 84.51° can capture large amounts of data from shoppers both offline and online, and can use this data to provide a more personalized shopping experience and a better idea of what advertising to what targeted customers will lead to the largest number of purchases. Gary Millerchip, CFO of Kroger, has said that he expects Kroger Precision Marketing to experience 50% growth in 2020. That’s a lot of additional revenue in a year when many CPG companies had to halt or cancel advertising campaigns amid the onslaught of the coronavirus pandemic and its resulting out-of-stocks.
Successful Partnerships
Walmart Media Group and Kroger Precision Marketing aren’t the only in-house self-service retail media networks in the grocery space. Minneapolis-based Target rebranded its platform to Roundel in 2019, and Boise, Idaho-based Albertsons has Albertsons Performance Media, although this solution is powered by Quotient. These types of partnerships with e-commerce advertising platforms and technology companies are a way for retailers of all sizes to become more viable media networks for CPG advertising and harness the companies’ ad dollars. Take, for example, CitrusAd, which launched in 2016. The Australia-based company works with such U.S. supermarkets as Harris Teeter, Wakefern Food Corp. and Hy-Vee to help them serve up personalized digital marketing experiences for shoppers. These experiences can include sponsored products and display ads. The CitrusAd platform is designed as a white-label native ad server, so retailers still maintain control over when, where and how ads are served. CitrusAd says that products that are live with its offerings have an average 94% increase in total online sales month to month. All of these advertising offerings center on the idea that personalization is beneficial to retailers, CPG companies or advertisers, and consumers, something that Boal strongly believes. “In order to get something of value, we have to know you, and if you don’t demonstrate to shoppers that you know who they are, they’re turned off,” he explains. “In a store, there’s treasure hunting, and you can walk all the aisles, and you can have an experience. You can discover. [With] a screen, you have to give that same rewarding e-commerce discovery, but you have to narrow the consideration set.” An advantage to the increase in online pickup and delivery sales is that every e-commerce experience is a logged-in and directly connected experience, so retailers can deliver this personalization.
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progressivegrocer.com
Online pickup and delivery sales offer the advantage of being completely logged-in and directly connected experiences to help the retailer know a specific shopper.
Indies, Too
While major retailers have well-established and sophisticated media operations, even independent retailers are able to operate as media platforms. This is true even for those with a single store whose e-commerce capabilities are provided by a third party. Just like major retailers, functioning as a media platform gives independents the ability to drive digital sales and ad revenue. Rochester, N.Y.-based Freshop provides e-commerce solutions for digital engagement through key features such as promoted banners, paid search results and interception at checkout. “One of the ways Freshop supports independent grocers is by leveraging digital ads for revenue,” says Kevin Sullivan, director of digital category management with Freshop. “We work directly with leading consumer packaged goods companies to bring the most up-todate product info to the site, but also drive sales and bring in extra revenue streams for the retailer.” Plans are constructed for promoted products that also integrate with sales and coupons, using mechanisms such as clickable banners and sets of promoted products, with revenue generated on a cost-per-click basis. “Digital ads with Freshop are a way for CPGs to promote their products and a way for retailers to add an extra stream of revenue,” Sullivan adds. “To participate, retailers just opt into the ad program, and Freshop does all the negotiation with the CPG companies.” An individual independent retailer wouldn’t be worth the effort, but collectively, the more than 3,000 stores using the Freshop platform represent meaningful volume. Whether for independent retailers or the likes of Walmart, the success of digital media channels lies in the ability to make them a win-win-win for all parties involved. Shoppers need to benefit from the personalized offers; CPG companies need to experience increased sales, brand awareness and return on their ad spend; and retailers need to garner increased product sales and alternative revenue.