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Grocery Retail as a Media Network - Zooming into Albertsons

by 
Shira Petrack
 on 
May 30, 2022
Grocery Retail as a Media Network - Zooming into Albertsons

Our latest grocery whitepaper examined how the recent economic shifts are impacting the grocery industry and highlighted exciting new opportunities amidst the challenges. One such innovation allows regional and national grocery brands to leverage their physical footprint to create a media network. We looked at the potential of grocery retail marketing by diving into location analytics data for Albertsons – a leader in this space that has already begun experimenting with the concept. Read on for some of the highlights, and check out the full report here.

What does a Grocery Media Network Look Like? 

Looking at the marketing value of a physical location aims to leverage the reach stores have to consumers at or near their point of purchase – while the consumers are choosing between competing products or brands. Retail marketing can take the form of in-store or digital ads, product sampling, or loyalty programs that distribute promotional coupons and vouchers. Companies that engage in retail marketing can generate revenue both by selling advertising space to third parties, and by improving their own marketing efforts through first-party data about their customers. And grocery brands, with their extended store fleet, frequent visits, and diverse customer base seem perfectly positioned to reap the benefits of retail marketing.  

Albertsons Takes Its Marketing In-House

In November 2021, Albertsons, which also owns the grocery brand Safeway, launched its own retail media network named Albertsons Media Collective. The goal of the network is to develop digital ads and other branded content for consumer packaged goods (CPG) companies. As part of its launch of an in-house media network, Albertsons ended its previous partnership with media firm Quotient; the grocer is now set to have complete control of its advertising potential. 

Albertsons will be competing for CPG spending with numerous companies that have their own media networks. This includes Kroger, another national grocery chain trying its hand at retail marketing. The already substantial market is only expected to keep growing, with 81% of CPG brands planning to boost their investment in retail media over the next year. Meanwhile, digital research firm Forrester predicts that retail media sales will reach $50 billion globally, as soon as next year, as advertising that relies on first-party data becomes “mission-critical” for marketers.

The growth in Albertsons visits underscores the exposure potential of the company’s new media network. Comparing each month in 2021 to a January 2021 baseline shows an exponential growth pattern with 23.6% more visits in December 2021 than in January of the same year. This means not only an increase in actual visits, but also a 23.6% increase in the number of views and impressions to Albertsons new media network.

Appealing to Local Consumer Interests

Whereas in the past, online advertising allowed for significantly more granular targeting, today’s technologies also enable brick and mortar retail advertisers to characterize their audience fairly precisely. Using GeoWeb data on the Placer.ai platform, we took a look at search categories from the trade areas of top performing Albertsons locations to identify differences in regional consumer interests. In the graph below, any search category with an index score over 100 indicates an above-national-average interest – which means that CPG or other companies catering to these interests would do well to advertise in those specific Albertsons locations.

Several differences between consumer preferences stand out – most notable in the food and beverage category. The Meridian, ID Albertsons location has a high index for both beer and whiskey lovers, with indexes of 169 and 154, respectively. Meanwhile, customers in the top performing New Mexico Albertsons location are Mexican food enthusiasts, with the Hobbs, NM locations having an index of 141 and the Carlsbad, NM location seeing an index of 154. And fitting neatly into California stereotypes, Albertsons shoppers in Paso Robles, CA showed an interest in veganism, with an index of 106 above average. 

Albertsons along with companies that wish to use its nascent media network to advertise their wares can use information such as the data above to calibrate their marketing investment. 

Revolutionizing Grocery’s Brick and Mortar Potential  

The idea that a brick-and-mortar store can launch a media company similar to ones on e-commerce sites is not just new, it’s revolutionary. The ability to tap into first-party data collected via rewards programs allows retailers to tailor their advertising specifically to the customer, region, and interest, and sell advertising space to third parties such as CPG companies. 

For a deeper dive into retail marketing and the state of the grocery category today, read our whitepaper

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