Thomas Benedict, Ibotta vice president of data and media, is passionate about providing activation, attribution, and analytics solutions for brands and agencies using the app company’s compliant, fully opted-in and deterministic purchase data.
Path to Purchase IQ recently chatted with Benedict about his work focused on retail media networks. He will present on Oct. 13 at the Retail Media in Action virtual forum. His session is titled “Retail Media Proliferation: How To Efficiently Manage & Measure Multiple Platforms.”
P2PIQ:What is the retail media opportunity, and why is everyone launching platforms?
Benedict: Amidst COVID concerns, consumer digital acclimation, and the increasing availability of grocery shopping online, consumer purchase behavior is obviously changing. An estimated 40% of consumers are buying groceries online1 and marketers need to meet shoppers where they shop. According to Boston Consulting Group, there is an estimated $75 billion worth of marketing funds up for grabs in this new normal2. Most retailers have embraced online shopping, and they would be foolish not to consider the upside of selling contextually relevant ads on their platforms. The problem is that the sophistication, efficacy, and measurability of these new retailer ad platforms varies greatly.
P2PIQ:How should CPGs and shopper marketers evaluate new retail media platforms?
Benedict: First and foremost, marketers need a strategy to address the new retail media paradigm. Like planning for any other channel, marketers should set budgets, timelines, and measurable goals for retail media in advance. Once a strategy is in place, marketers must consider the available options that will match their goals. Considerations should include product distribution, ad units available, scale, cost, measurement options, in-flight optimization levers, programmatic media efforts, in-store retail media efforts, and all of the expected soft costs of executional operation. I also recommend using a small test campaign to test and validate the performance of these nascent platforms before diving in fully.
P2PIQ: What can I confidently measure with retail media?
Benedict: The good news is that retailers own the purchase data and have logged in, authenticated shoppers, allowing them to tie impressions to sales. Unlike upstream measurement proxies leveraged in digital media, such as viewability, brand lift, or visit lift, purchase data is absolute. It is the most important metric for most CPGs and shopper marketers. Sales lift or conversion studies are often packaged into Retail Media buys and can be more affordable than third party sales lift studies. The bad news is that online shopping still accounts for less than half of all sales, and tying Retail Media impressions to offline shopping is difficult without comprehensive loyalty card adoption that synchronizes with a web or app ID. Moreover, retail media platforms are grading their own homework. You should do your diligence to make sure you’re comfortable with the level of transparency and the measurement methodologies they’re using.
P2PIQ: How do I compare performance across Retail Media platforms?
Benedict:Unfortunately, there’s no perfect way to measure retail media across platforms. Different platforms leverage different methodologies to calculate sales lift, ROI or CPUM, so it’s very difficult to say if one platform performed better than another even when the reported metric is the same. Retailers aren’t likely to expose their users or ID-level sales data to third parties because they don’t want to give up their audiences. That makes traditional multi-touch attribution vendors powerless. Probabilistic measurement models can provide directional guidance based on aggregated sales data and assumptions, but their accuracy is severely limited without individual level impression and sales data. Marketers accustomed to the difficulty of comparing Facebook video to YouTube are all too familiar with the reality of siloed attribution. There are retailer representative options including Ibotta Media Group that can tie ID-level impressions to redemptions and sales across retailers, but Ibotta Media Group is just one effective platform in the rapidly expanding retail media landscape. Marketers must prioritize the most important retail media platforms and make best efforts to optimize their ad spend for each one.
P2PIQ: Should the siloed state of retail media give marketers pause?
Benedict: The short answer is yes, but the long answer is that the pros of retail media vastly outweigh the cons. Consumer privacy continues to take center stage on the legislative front, and powerhouse players like Apple and Google are using that cause to eliminate or negate the power of identifiers for advertisers. Apple has made tracking Mobile Ad ID (MAID) opt-in, and Google Chrome will be phasing out cookies in 2023. Retail media is incredibly compelling to marketers because it can track the sales of logged-in users. It’s hard to overstate the value of targeting users with contextually relevant ads as they are literally in the process of selecting a product. Retail media essentially skips over earlier parts of the path to purchase to reach users already in the lower part of the funnel. Marketers must be diligent with their research and demand transparency of their retail media platform partners. We are in a new normal, and most of these platforms (Amazon aside) are still figuring things out. Large retail media buys give marketers the ability to influence the evolution of retail media products and create a more symbiotic, transparent relationship. At the end of the day, retail media platforms have a vested interest in driving sales, so incentives are aligned, and these platforms would be wise to welcome feedback from marketers.