Kroger Precision Marketing (KPM) increasingly has become a consideration for advertisers when thinking about buying media on and off the company’s grocery websites.
Some media buys go through its programmatic business to serve ads across the open web. Brands may also use KPM’s direct relationships with publishers such as Roku or Pinterest.
Michael Schuh, vice president of product strategy and innovation for KPM at 84.51°, said the company worked with nearly 2,000 brands last year as well as publishers -- naming Meredith -- and Pandora, along with many more.
“We work with the brand to build a custom audience using first-party data, and then work with publishers like the Roku team to build that audience,” he said.
KPM offers a private marketplace where advertisers can pair audiences with inventory across the open web and buy media from their preferred demand-side platform (DSP).
Schuh said it works because KPM understands where its customers consume media across the web. Advertisers are being more selective about the first-party data they use and where they buy their media. “We’re keeping a close eye on where consumers spend their time,” he said. “Customers can now consume content in one or two clicks. … The shopper journey is now a series of short sprints.”
KPM offers on its website two types of ad units — display banner and search. “We keep a close eye on the balance of organic and paid results to provide a good experience,” he said. “We don’t allow direct competitive conquesting.”
Pepsi, for example, cannot buy the branded keyword Coke on Kroger.com. Schuh said it is not the correct experience for customers, or for brands having to defend their branded keywords. KPM’s strategy also now focuses more on using data to analyze the quality of the website experience based on consumer searches, or their propensity to try a new product.
Data has become a backbone to KPM’s media business.
Last week, Neutronian, a data certification company, debuted its initial published NQI Transparency Ratings Report, an analysis of the public transparency and data quality of roughly 150 data providers that includes companies like Kroger.
As retail and media and consumer behavior continue to evolve, they are defining the future of shoppable media.
A company spokesperson said last year the company announced at an analyst meeting that retail media is the “fastest growing alternate profit pillar” for Kroger, where the company “nearly doubled the media spend per order in the past year.”
Grocery commerce has grown in the past couple of years, and Kroger has publicly committed to double ecommerce sales in the next several. Some of that growth will come from its own properties, but also hybrid shopping of in-store and online.
“We will grow by breaking into the programmatic industry, commerce, and publisher relationships,” Schuh said.
Last year, Kroger Co.’s retail media arm launched a private programmatic advertising marketplace for consumer packaged goods (CPG) brands and marketers. Publicis Group participated in the initially tests. Kroger serves more than 60 million households nationwide.
KPM and 84.51° leverage the data that amount to millions of daily transactions and numerous digital properties and about 2,800 stores. It also includes loyalty cards used in stores that capture 96% of Kroger sales and the customer’s digital account.
The company last year also made enhancements to the Kroger app to find products, use Kroger Pay at checkout, and discover coupons.