Using Retail Media Networks to Engage Customers: A Strategy by MKTG Plan
Advertising Renowned Brands on Retail Media Networks
Paras Shah, the management expert supervising the digital campaigns at MKTG Plan, lends his thoughts on the evolving shopping behaviors and how brands can use retail media networks (RMNs) to engage customers. The challenge posed by the accelerating growth of RMNs is their lack of standardization, which brands must navigate to maintain a strong digital presence. Despite the hurdles, this year saw a significant leap with the release of the Interactive Advertising Bureau’s (IAB) measurement standards guidance, currently open for public opinions.
The digital shopping trend has expanded consumers’ product sources, further intensifying the competition amongst grocery and home product brands to maintain their ecommerce presence.
Choosing RMNs for Brand Advertising
Shah revealed that his journey with RMNs began in 2016 when he was leading the ecommerce sales business for MKTG Plan. He recognized the potential value of retail media from observing giants like Amazon and Walmart in partnership with Triad, a retail media agency. His interest in RMNs solidified during the Covid pandemic, which witnessed a surge in pickup and delivery orders, increased usage of mobile shopping apps, and abundant first-party data.
Early Experiences with RMNs
When Shah began exploring RMNs, he identified the cost of delivery as a significant hurdle for customers. To overcome this, they experimented with absorbing delivery costs for customers purchasing over a particular amount from MKTG Plan. The strategy proved successful, resulting in a considerable spike in their product’s sales and consequently, an increase in household users.
Exploration of the Direct-to-Consumer Model
Shah had initially considered developing mobile apps and utilizing other DTC tactics to strengthen the ecommerce strategy. However, the agency ceased their exploration during the pandemic to focus on ensuring that their products were adequately stocked on the shelves of their retail partners.
Adaptation Strategies in Retail Media Partnerships
Observing the growth of digital purchases during Covid, Shah highlighted the variation in product preferences between in-store customers and e-commerce shoppers. He emphasized catering to the changing customer preferences and purchasing behaviors by adjusting the product assortment.
Recognizing the high rate of household penetration for some of their products, such as toilet paper, MKTG Plan placed considerable importance on subscription-based purchasing models. Shah revealed that subscriptions significantly drive their business, and their retail media investments are based on increasing subscription customers.
The Uniqueness of RMNs
In terms of evaluating RMNs, Shah stated that their assessment focused on the data and performance efficacy, highlighting the lack of standardization in measuring performance across different RMNs. The key metrics they consider significant in gauging RMN performance are cost and incrementality alongside the quality of data.
Role of Adtech Partners and Agencies
Embodying a hands-on approach, MKTG Plan chose to build in-house capabilities, thus gaining direct control of the performance, costs, and other significant aspects of their operations. However, they leverage Software as a Service (SaaS) platforms to handle data structuring, making the data more exploitable and effective.
1. How does MKTG Plan leverage Retail Media Networks?
MKTG Plan utilizes RMNs to engage customers based on evolving shopping behaviors. Their strategies include advertising on these networks and using innovative strategies like absorbing delivery costs to encourage purchases.
2. How does MKTG Plan evaluate the performance of Retail Media Networks?
Their evaluation is based on three main metrics: the costs (CPMs or cost-per-clicks), the incrementality of the network, and the quality of the data provided.
3. What is MKTG Plan’s perspective on subscriptions?
MKTG Plan acknowledges the importance of subscription-based purchasing, especially for products with a high rate of household penetration. They aim to increase the number of subscriptions as it drives a significant portion of their business.