ANA Panel with Kroger Precision Marketing and Unilever Highlights Success of Retail-Data Driven Advertising

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Recency and relevancy collide as retailers are closing the loop between the shopper information that they gather with each swipe of a loyalty card and the new digital touchpoints that consumers have adapted, such as online shopping or digital coupon clipping during the pandemic. For most of the CPG world and beyond, this system means a much smarter, deterministic method to drive sales and get customer, product and competitive insights on a macro-and-micro distribution level. The fact that it is founded on permission-based first party data in a world where collection and usage of data is now on shaky ground ensures that this is exactly the type of data which is likely to survive and thrive past the current privacy turmoil.

According to leading grocery trade source Supermarket News, in 2021 Kroger Corporate (which includes grocery brands such as Kroger, Ralphs, Dillons, Smith’s, King Soopers, Harris Teeter, Fred Meyer and more) is the largest grocery retailer in the U.S. with over 2,700 stores, and drives $132.5B annually in sales. In 2015, Kroger formed the data science division, which they named 84.51°. 84.51° leverages first- party retail data from nearly one of two U.S. households and 2BN+ transactions.

Michael Schuh is Vice President, Media Strategy for Kroger Precision Marketing, the team at 84.51° in charge of media sales and business development around the use of all the data. Advertising inventory may be purchased to run within Kroger digital properties or on the open web targeted by the Kroger data. Schuh and his team are really excited about bringing value to their customers, bringing value to advertisers and the ecosystem, and holding media dollars more accountable to real outcomes. “We leverage our audience data and our intelligent audience solutions to help brand marketers reach the right customers at the right time, driving efficiency into their media investments,” he said.

84.51° is the longitudinal degree of Kroger HQ in Cincinnati, OH. Schuh related that the name was thoughtfully chosen to convey the longitudinal view that the company takes to data. “We take a longitudinal view of our customers," he explained. "We believe that customers [aren't] what they purchase in a single transaction, but their behavior over time. What causes them to shift between brands? What happens when they enter a category or leave a category? We have a really unique ability to see a customer’s breadth of purchase, not just across a store, but across time as well.”

No other category has been as radically transformed by the pandemic as the grocery retail category. With consumer behavior dramatically shifting during the beginning of the pandemic, then shifting again as the vaccine rolled out, and continued volatility due to variants, we asked Schuh what impact that had on the data and the business. “We had a recent and immediate view into what was happening and that made us an incredibly valuable resource to brands," he said. "Many customers tried new brands for the first time; some because they were stuck at home, and others out of necessity as their preferred brand was out of stock. For brands, the access to recent data allowed them to quickly activate. For a brand, perhaps you had to pause your media because you had out-of-stocks, but when your product was back in stock, we provided guidance on how to activate quickly so customers knew your product was there, and you weren’t reaching them with an irrelevant message.”

At the recent 2021 ANA Media Conference, Schuh hosted a session, Coffee with Kroger: Media KPIs in Action -- How Unilever Used Retail Media to Drive Real Business Outcomes with Cathy Lauro, Shopper Marketing Manager for Unilever. During the discussion, the two spoke about the importance of real, deterministic data and provided an actual case study for the ice cream category, a category that is promoted 26 weeks of the year. Lauro explained the differing objectives between Unilever’s two main ice cream brands, Breyers and Ben & Jerry’s. For Breyers, they were stuck in a pattern of their new consumers, acquired during the pandemic, switching brand to brand based on sale price. Ben & Jerry’s had a loyal customer base, but, according to Lauro, “People weren’t buying enough.”

In determining the KPIs for the media plans for each brand, Lauro was adamant that they move beyond delivery metrics to performance. “You can’t take impressions and clicks to the bank!” she declared. Using Kroger Precision Marketing’s targeting science, Lauro was able to segment out the loyal Ben & Jerry’s and Breyers HHs that “really helped to drive the alignment and get that business result.” By focusing on the data and using it to deliver the specific audience, Unilever was able to efficiently deliver on the objective for Breyers to grow HH penetration and for Ben & Jerry’s to grow units per-visit.

In a follow-up with MediaVillage, Lauro spoke highly of the Kroger Precision Marketing team. “We’ve been on the retail media journey with Kroger since the inception of Kroger Precision Marketing," she said. "Performance expectations have always been high. KPM has consistently delivered meaningful data for targeting and measurement.”

So, has the learning Unilever received through its engagement with KPM impacted the way it approaches any other part of the media mix? “Yes,” Lauro confirmed. “What we learn from Kroger Precision Marketing -- including consumer insights like which product varieties, messages and offers shoppers respond to -- can inform our broader activations.”

Over the past year and a half, we’ve all been reminded of the importance of the grocery store. It was and is literally an essential part of our lives. Every transaction within that environment is a key signal of both the micro- and macro-level economy. We’ve seen a plethora of retailers turning into media companies using their data. With a resource of the size and scale of Kroger Precision Marketing, marketers, CPG and others can get an almost real-time view of their customer and prospects, and almost immediately translate that view into an actual outreach through the media network to get almost immediate feedback on that messaging.

So, what’s next for Kroger Precision Marketing? Schuh gave us a glimpse. “You’ll see us continue to make sure our data is available for advertisers to buy (both self-serve and managed service) and new ways to reach our customers in a way that is both relevant for the customer and performs for the advertiser," he said. "We are really good at measuring a single activation, and now you’ll see us look at the long-term impact on likeability and brand lift in order to retain customers.”

Kroger is the largest supermarket chain and the third-largest overall U.S. retailer according to the national retail federation.

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