Marketing
13 March 2023
Best Buy will provide first-party data to Roku for streaming ads
Consumer electronics is a top retail media category.
Roku ads have more data behind them. (Courtesy photo)
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Best Buy’s advertising capabilities are set to help power a streaming platform.
The news: Best Buy will provide its first-party advertising data to Roku for targeting and closed loop measurement. It means Best Buy’s year-old retail media network is now powering advertising beyond its own platform.
How it works: Best Buy and Roku said the goal is to make TV advertising “more relevant and performance-driven.”
The partners will provide targeting, optimization and measurement of ads on Roku that use shopper data from Best Buy. As a retailer, Best Buy has access to first party data at the purchase level, which can provide details about a shopper that signals their intent to buy certain products. That’s valuable to advertisers, who want to reach the consumers that are most likely to buy a product.
Not just ads: This is part of a wider partnership that will also feature a prominent place for Roku-branded TVs at Best Buy. This week,tThe two companies are partnering on an interactive popup at SXSW in Austin.
Key quote: “Our goal is to create a better TV experience for everyone,” saidJulian Mintz, co-head of U.S. brand sales for Roku Media. “We’re bringing together our entire business to build the future of entertainment and advertising — making the TV experience simpler, offering the right marketing, data, tech, and scale to drive real results, and helping win the entire streamer’s journey together with Best Buy.”
What it means for retail media:
Activating consumer electronics: While retail media is often considered the province of major CPG brands or Amazon sellers, consumer electronics are playing an outsize role in the early growth of this format. According to MediaRadar, this category accounted for 15% of retail media spend in 2022, leading all categories. That helps explain why Roku wants to add Best Buy’s data to the mix: Understanding intent in one of the most popular advertising categories can help better reach shoppers with those products.
Going offsite: The partnership shows how retail media is extending beyond retailers’ own marketplaces. The first-party data being used by Roku is a valuable asset to the streaming platform’s advertising effectiveness. First-party data has been understood to operate within a “walled garden,” where data owned by a retailer can only be used in their store. This partnership shows how technology is quickly climbing over that barrier. Importantly, brands and platforms will have to keep privacy in mind as more of these partnerships take hold.
Consider privacy: One major catalyst for the growth of retail media was privacy-oriented changes to third party tools, notably the Apple App Tracking Transparency changes that dealt a blow to Facebook's vaunted attribution engine. To become a lasting marketing channel, retail media can’t simply repeat the same tactics that brought so much scrutiny in the past, or recent history indicates it will repeat the same fate as advertising on the open internet.
Streaming ahead: Roku’s involvement underscores a key growth area for advertising: Streaming platforms. Called Connected TV, or CTV, streaming offers a form of TV advertising that reaches people while they are on their couch and passively watching content in a pastime that is familiar to most Americans, while also bringing in the targeting and measurement capabilities of the internet. Best Buy’s partnership with Roku shows that there is room not only for retailers to advertise products in that equation, but also to leverage data that is at the heart of a whole new business model.
Further reading: Roku has been on the forefront of combining commerce and media. It has also recently partnered with Walmart and DoorDash to create shoppable ads that allow consumers to order items using their remote.
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Marketing
09 June 2023
'There's a lot of ways to frame value'
Campbell Soup Company CEO Mark Clouse offered thoughts on messaging amid inflationary shifts in consumer behavior.
Photo by Kelly Common on Unsplash
After months of elevated inflation and interest rate hikes that have the potential to cool demand, consumers are showing more signs of shifting behavior.
It’s showing up in retail sales data, but there’s also evidence in the observations of the brands responsible for grocery store staples.
The latest example came this week from Campbell Soup Company. CEO Mark Clouse told analysts that the consumer continues to be “resilient” despite continued price increases on food, but found that “consumers are beginning to feel that pressure” as time goes on.
This shows up in the categories they are buying. Overall, Clouse said Campbell sees a shift toward shelf-stable items, and away from more expensive prepared foods.
There is also change in when they make purchases. People are buying more at the beginning of the month. That’s because they are stretching paychecks as long as possible.
These shifts change how the company is communicating with consumers.
Clouse said the changes in behavior are an opportunity to “focus on value within our messaging without necessarily having to chase pricing all the way down.”
“No question that it's important that we protect affordability and that we make that relevant in the categories that we're in," Clouse said. "But I also think there's a lot of ways to frame value in different ways, right?”
A meal cooked with condensed soup may be cheaper than picking up a frozen item or ordering out. Consumers just need a reminder. Even within Campbell’s own portfolio, the company can elevate brands that have more value now, even if they may not always get the limelight.
The open question is whether the shift in behavior will begin to show up in the results of the companies that have raised prices. Campbell’s overall net sales grew 5% for the quarter ended April 30, while gross profit margins held steady around 30%. But the category-level results were more uneven. U.S. soup sales declined 11%, though the company said that was owed to comparisons with the quarter when supply chains reopened a year ago and expressed confidence that the category is seeing a longer-term resurgence as more people cook at home following the pandemic. Snacks, which includes Goldfish and Pepperidge Farm, were up 12% And while net sales increased overall, the amount of products people are buying is declining. Volumes were down 7%.
These are trends happening across the grocery store. Campbell is continuing to compete. It is leading with iconic brands, and a host of different ways to consume them. It is following that up with innovation that makes the products stand out. Then, it is driving home messaging that shows consumers how to fit the products into their lives, and even their tightening spending plans.
Campbell Soup is more than 150 years old, and has seen plenty of difficult economic environments. It is also a different business today, and will continue to evolve. At the end of the day, continued execution is what’s required.
“If it's good food, people are going to buy it, especially if it's a great value,” Clouse said.
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