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10 minutes of expert insights every weekday. Your morning ritual for staying ahead in retail media.
Why Do Brand Marketers Love To Hate On Retail Media?
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[00:00:00] Kiri Masters: In case you missed it last week, there is a new beef in marketing, and this one hits close to home. In late August, marketing expert Mark Ritson published a column in Adweek called Don't Let [00:00:15] Retail Media Tell You It's Brand Building. His argument is this: retail media is essentially just slotting fees with a fancy name and a dashboard.
[00:00:25] Therefore, you should treat it as a bottom of funnel defensive [00:00:30] investment that locks in your distribution
[00:00:33] And as the correct new home for trade promotion money. But don't think for one moment that it's brand-building. Now, that sentiment is something that a lot of us have [00:00:45] probably heard before, but Andrew Lipsman, independent media industry analyst, decided to wade into the muck And fight back. He answered in his own Adweek op-ed five days later under the headline Retail [00:01:00] Media Can Build Brands, Including Ways Other Media Can't.
[00:01:05] Now, both of those op-eds are worth reading in their own right, but the gloves really came out in the comment sections of a few [00:01:15] LinkedIn posts discussing those columns. Retail media network leaders, CPG marketers, agency strategists and academics all waded in with their POVs, and no one was mincing their [00:01:30] words.
[00:01:30] In fact, I think whatever people have been quietly thinking about this, it was finally time to make their thoughts known
[00:01:38]
[00:01:39] Kiri Masters: so let's hear what the skeptic case was, where they might have a point, and [00:01:45] why perhaps everyone is right in their own way.
[00:01:47] So Mark Ritson's core claim is this: that growth comes from building mental availability among people who aren't shopping your category today, and that retail media by its very [00:02:00] definition and operation reaches the ones who are. Now, Josh Clarkson, who runs global retail media at Mars, attacked that definition.
[00:02:10] What definition is this? Not mine. His own version of the [00:02:15] definition of retail media~ retail media is media that uses retailer data or that lives on a retailer's owned property Now he conceded a little bit on the second half that some on-site ad types do need more work on incrementality and then took the first half apart.~
[00:02:16] ~Retailer data lets you find shoppers who have browsed your category, bought in relevant adjacencies, and spend at the right level~
[00:02:16] ~Josh Clarkson, who runs global ~is media that uses retailer data or that lives on a retailer's owned property. He Now, he conceded that some on-site ad types do need more work on incrementality.
[00:02:28] But Clarkson also [00:02:30] argues that retailer data lets you find shoppers who have browsed your category, bought in relevant adjacencies, and spend at the right level. Clarkson answered Ritson's argument with a single word: codswallop [00:02:45] Brian Spencer, marketing director at Kroger Precision Marketing, patiently explained that brands use retail media audiences across CTV, audio, and social, not just on-site on a retailer's [00:03:00] website.
[00:03:00] Targeting capabilities allow brands to reach lapsed buyers, competitive buyers, and households that have never bought the brand at all, and that you can build an audience which deliberately excludes your recent and loyal [00:03:15] buyers. Now, if you can exclude your own customers and spend the whole budget on people that have never picked your products up, that's something that brand marketers have wanted for decades and exists now.
[00:03:28] But it is still a [00:03:30] rounding error in most retail media budgets. Most marketers don't understand all the things that retail media actually does Because Ritson's description of what retail media is only really fits the [00:03:45] sponsored product ads definition But it doesn't fit a retail media audience that's been activated in streaming TV against households that have never bought you.
[00:03:56] Lipsman's framing that retail media is [00:04:00] both a channel and a layer is the crux of the disagreement. poor audience targeting is frustrating, but for retail media teams it can [00:04:15] be costly too. With Growth Loop's composable commerce media solution, you can turn your first-party data into hundreds of high-value audience segments and launch campaigns [00:04:30] faster. After partnering with Growth Loop, instant commerce pioneer Gopuff scaled from a hundred syndicated audience segments to more than six hundred, and now it takes less than forty-eight hours to turn [00:04:45] around a custom segment for one of their brand partners.
[00:04:49] Learn more about how Growth Loop is powering Gopuff's best-in-class retail media operations at [00:05:00] go.growthloop.com/breakfast. That is go.growthloop.com/breakfast Now let's talk about where the skeptics might have a point. Lipsman himself [00:05:15] lands one correction that isn't a matter of opinion. Ritson called attributing sales to shoppers already in your store the single most flattering metric in marketing, and Lipsman's response, "That would be fair [00:05:30] if in-store advertising were measured that way, but no serious brand accepts ROAS or attributed sales for in-store and matched market testing is in fact the standard."
[00:05:44] Now, [00:05:45] Ritson has his own point that survives a lot of the criticism. In twenty twenty-four, the ANA asked marketers where retail media money comes from, and only ten percent said it was incremental. [00:06:00] The rest is coming out of something, and a good chunk of it is coming out of brand budgets Now, no amount of evidence about what retail media can do answers a question about where the money [00:06:15] went, which brings us to some fresh numbers from Kantar
[00:06:20] Across over 1,500 campaigns in their LIFT database, Kantar finds that retail media beats the average channel on [00:06:30] unaided awareness, online ad awareness, brand favorability, and purchase intent. Candidly, it still loses on a couple: aided awareness and message association. [00:06:45] It lost a little bit of ground
[00:06:46] Versus those other average channels
[00:06:49] But overall, the findings support retail media as being a strong brand-building channel. Now, there's a second thing worth saying about that data. A [00:07:00] brand lift study only exists because someone was willing to pay for one, which means the lift database is full of campaigns with real budget and real creative behind them.
[00:07:11] Now, that may not be the median retail [00:07:15] media buy, and Ritson's whole point is about the median retail media buy. So wrapping up here, I think that everyone has a good point here, that perhaps everyone is right in their own way, and Lipsman settled this himself in a [00:07:30] LinkedIn reply. He conceded that search and branded search take about seventy to eighty percent of retail media dollars right now and agreed that that is a bad practice.
[00:07:41] It's the same ROAS chasing that [00:07:45] goes on at Meta and Google. His point was that just because brands don't invest enough into the right formats doesn't mean the capacity for brand building doesn't exist. Now, there were a bunch of measurement experts weighing in on [00:08:00] this debate, and they suggested with very little pushback that advertisers shouldn't rely on retailer-provided bottom-of-funnel metrics like ROAS.
[00:08:09] Instead, they should be running holdout studies, work out what's actually incremental, [00:08:15] and move their budgets accordingly. Now, both of these pot stirrers are right , but they might be describing different things. Ritson is describing where the money goes, and his critics [00:08:30] are describing what the channel is capable of.
[00:08:33] That's it from me today. Thanks for listening, and I'll catch you tomorrow.
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