Optimizing Retail Media: Killing the Purchase Funnel

Cyndi Loza
Associate Editor, Path to Purchase Institute
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Marketing teams at consumer packaged goods companies have long been segmented by their broad area of responsibility across the purchase funnel: Brand marketing used mass media to work the top of the purchase funnel while shopper marketing closed the sale at the bottom. E-commerce, however, has flattened the funnel, forcing companies to adjust traditional practices and mindsets. 

"We've kind of just said, 'No more funnels,'" said April Carlisle, Coca-Cola vice president, marketing, during a panel discussion on "Optimizing Retail Media Networks" at last November's Path to Purchase Digital Expo. "It should just be a 'connected commerce' experience and no matter where ... the shopper signals that they're ready to buy, we have a solution." 

Optimizing Retail Media Session
Marketers discuss best practices for working with retail media networks and winning the digital aisle at a panel discussion during last November's Path to Purchase Digital Expo.

Lindsey McGowan, General Mills shopper marketing manager, and Reid Hunter, Kraft-Heinz director of e-commerce, joined Carlisle on the panel, led by Cara Pratt, senior vice president at Kroger Precision Marketing (KPM), to discuss best practices for working with retail media networks and winning the digital aisle. Echoing the general sentiments of fellow panelists, McGowan said digital media works best when it provides a frictionless ability to purchase. 

"The more clicks you ask a customer to take, the less likely they are to actually complete that transaction," McGowan said. "Targeting all households with strong creatives certainly increases their engagement rate, but transporting them directly into an e-commerce platform is really what we see translate that engagement into a sale. So, we challenge ourselves to really make every moment shoppable, and that means incorporating retail media into the full funnel of media planning and into our commerce plans."

Even before the COVID-19 pandemic, retail media networks were on the rise, with retailers building up their digital media assets to establish themselves as legitimate and powerful options for national brand advertising. As more shoppers turned to e-commerce during the pandemic, the upward trajectory of retail media networks was only accelerated as more marketers leaned on platforms like Kroger's retail media platform, KPM, to connect with shoppers eschewing stores and adopting new shopping habits.

“The richness of Kroger data has always been a huge enabler for us to better understand our customers and provide relevant and personalized experiences,” said McGowan during the panel, which was hosted and sponsored by KPM. “However, in a time like today, when dramatic shifts are happening [in] real time, it’s been an invaluable asset for us just to keep up with patterns that are shifting quickly to meet the customers’ needs.” 

Carlisle highlighted retail media networks' targeting effectiveness (for which KPM received high marks in the Path to Purchase Institute's Trends 2021 survey) as a key benefit. Coca-Cola could, for example, send a message to Diet Coke users about AHA, a sparkling drink brand that the manufacturer launched in the spring of 2020. "Having that [precise] level of data and targeting capabilities has really helped us find the right audiences, serve them the right message and get them to drink all kinds of our products," Carlisle said. 

Maintaining momentum with new households will be an ongoing effort that retail media networks could help with. During the beginning of the pandemic and the start of stay-at-home orders in the first half of 2020, McGowan noted an uptick in sales of General Mills' Betty Crocker and Pillsbury baking SKUs. Strong demand continued well into the summer months and it was not expected to subside during the holiday season. "This is a differential skill that [shoppers are] learning and bringing into their everyday lives. So the challenge for us has been, 'How do you continue the momentum with those households? How do you provide ongoing inspiration for them throughout the different seasons [and] different mindset shifts?'" said McGowan, adding that this has driven investments, for example, in KPM's search functionality and ability to highlight previously purchased items.  

Half of retail media is educational, noted Hunter, pointing to banner ads that direct shoppers to curated content and products tying in to occasions such as back-to-school or fall football. However, "there are lots of different occasions that I think are untapped," said Hunter, noting the promotional success of National Coffee Day on Sept. 29, 2020. "You can kind of build new occasions so that consumers have more reasons to come online." (Click here for a closer look at National Coffee Day and other micro-holidays.)  

To view a video of the full panel discussion, visit