Kroger Is Bringing Its Retail Media Ad Tech InHouse
One of the biggest trends of 2014, ad tech insurance, has become one of the hottest trends of 2023: all-day retail media.
On Wednesday, Kroger Precision Marketing (KPM), the retail media arm of the supermarket chain, announced plans to fully integrate ad technology into self-service retail media and provided an update on the project's progress.
The platform is now in beta with some customers and will be generally available in Q4.
While advertisers can manage their Kroger retail media campaigns with third-party tools like Pacvue, Skai and Commerce IQ, the internal changes should allow consumers to consolidate spending and further segment the shopping experience.
"So many entry points create a lot of friction in understanding shopper behavior," said Kara Pratt, Kroger's senior vice president of Precision Marketing (KPM), Kroger's retail media division. We focus on building bridges to avoid conflict.
folding walls
But if Kroger launches a retail media house, it won't solve NMR's fragmentation in the broader market.
Media networks have exploded in recent years, and ad buyers are reluctant to add more walled gardens to their media mix.
But it's not surprising that marketers are reluctant to access their proprietary data for privacy reasons and because proprietary data is one of a company's most valuable assets, Pratt says.
But the walls are coming down.
Pratt said Pratt's creation of a single portal for on-site and off-site media buying should pave the way for integration with other media activation and management software.
And Kroger isn't alone. Over the past year, other major retailers, including Albertsons and Walmart, have taken steps to strengthen aspects of their retail media operations.
"The division is starting to fall apart," Pratt said. “It will take time, as we have decades of operational and organizational practice, to recognize retail media as a 'media' function and not as a separate channel.
Although nothing has been published yet, Kroger is active in the IAB, which works on standards for retail media. (However, when asked last week in Cannes whether Pratt Kroger supported a retail media valuation framework proposed by Albertsons' Media Collective, Pratt Kroger hesitated.)
single window
The initial rollout of Kroger's self-serve ad platform includes product ads and search ads on its websites that can target "personalized ad groups" based on things like a person's willingness to buy products in certain categories, or even a shopper's taste or smell. . . profile
For example, for a laundry detergent brand, it might be useful to know if someone likes a certain scent, lavender or April Fresh (whatever).
Kroger uses this type of information to inform organic search results and paid media placements, focusing on attracting new customers.
"Most of our impressions and clicks come from exposure when consumers discover a brand in the last 26 weeks," Pratt said. It is a conscious choice on our part, because we want to encourage the innovation of new products.
In addition to audience insights, advertisers can use Kroger's self-service platform to design, customize and activate creatives, and save creative and message templates for reuse in future campaigns.
Other extras include campaign budgeting, messaging and delivery, and reporting on retail metrics such as household penetration and sales growth.
Although it started with owned-and-operated media, Kroger will eventually expand its self-service platform to outdoor programming, as well as through social commerce integrations and streaming partnerships with companies like Disney and Roku.
Hello and goodbye
But self-serve advertising technology doesn't build itself.
KPM added nearly 100 new roles in the past year to support platform adoption, including engineers, product managers, data scientists and recruiters in media operations, customer success, marketing, sales and business operations.
Many of KPM's new hires come from within the media industry, including ex-agency buyers, data scientists and technology specialists from major publishers and experienced copywriters. Some positions are still open.
"We're looking for people with buying and selling experience," Pratt said, "who really understand the media supply chain, including where the waste comes from and the back-and-forth of selecting offers."
However, while Kroger spends time and resources hosting its own advertising platform, it doesn't cut out third-party partners. Advertisers deserve options, Pratt said.
However, some relationships are ending, including Kroger's partnership with Microsoft Ads, which previously used Kroger's self-serve advertising platform with its merchant marketing platform, PromoteAiki.
"I give Microsoft a lot of credit, they've helped us grow our media retail business, but this new platform gives us the ability to scale with deep personalization," Pratt said. "Kroger will continue to work with Microsoft in other ways, but we will no longer be using the auction and inventory management platform in the future."
