First published on
The in-house shift by Ahold Delhaize’s U.S. business is notable but unsurprising given the explosive recent growth of retail media. Like Albertsons, which launched its own retail media business last year, Ahold Delhaize wants to establish a more direct connection with CPGs while also expanding its advertising services.
In an interview, Watts characterized AD Retail Media, which is run through Peapod Digital Labs, as being “in the infancy stages” for most of the five years it’s been operating. It relied on media firm Quotient to develop and measure campaigns, helping launch features like a promotion amplification tool along the way. But Watts said Ahold Delhaize is now forging direct relationships with brands and hand-picking the technology it integrates into its retail media ecosystem.
That technology includes a new platform powered by CitrusAd and Epsilon that offers on-site and offsite campaigns. Ahold Delhaize is the first major retailer to utilize that platform, which launched in June. AD Retail Media will also utilize LiveRamp Safe Haven as a data collaboration solution while Quotient will continue to provide digital coupons.
AD Retail Media, like many other advertising houses run by grocers, currently specializes in sponsored search and banner ads, Watts said, and earlier this year began running in-store advertising campaigns on shelves, in shopping carts and elsewhere. With its growing in-house business, Ahold Delhaize is now eyeing deeper collaborations with CPG partners and running custom campaigns that leverage the grocer’s first-party data.
“Our goal is to be able to tap into those national ad budgets,” Watts said.
Watts said AD Retail Media divides its team into “pods” that specialize in specific categories, like beverages, and work with merchandising directors at the company’s various grocery banners to identify trends and incorporate retail media into their strategies.
Looking ahead, Watts sees an opportunity to utilize livestreaming videos to sell sponsored products — a capability Walmart, in particular, has honed through its various shoppable content experiments. He also sees potential in using the many video screens the grocer has in its stores, from menu boards to Coinstar machines, for advertising.
“There are just so many screens around our stores, [and] none of them are connected, none of them are talking. And we’re not planning media through them in a consistent way,” Watts said.
From national chains to regional operators, grocers across the U.S. are adding retail media capabilities in order to capitalize on the growing demand for the first-party consumer data they possess. This adds another revenue stream that helps offset rising digital and supply chain costs, but the industry is still in its early stages. Despite much discussion about the personalization capabilities of digital media, companies rely heavily on banner ads and sponsored search results currently.
During a panel discussion at the Groceryshop conference in Las Vegas last month, Emily Frankel, senior vice president and head of e-commerce marketing at PepsiCo, said CPGs find the lack of standardization across media platforms challenging to navigate. Companies are also working to improve how they measure performance.
Watts said the new CitrusAd platform is a “big plus-up” for campaign measurement for AD Retail Media and said he hopes to eventually be able to measure campaigns’ impact on channel performance to then be able to optimize those channel strategies.
The biggest challenge to retail media’s growth, however, might be finding enough people to work in these growing divisions.
“There’s so much demand in this space right now. There’s just not enough talent to go around like for folks that really understand retail media.” Watts said.
Get the free daily newsletter read by industry experts
Amid global conflict, domestic crises and the continued effects of the pandemic, many marketers struggled to connect with distracted consumers.
The Gen Z retailer looks to immerse consumers in celebrations as company research found this holiday season is all about “revenge living.”
Subscribe to Marketing Dive for top news, trends & analysis
Get the free daily newsletter read by industry experts
Amid global conflict, domestic crises and the continued effects of the pandemic, many marketers struggled to connect with distracted consumers.
The Gen Z retailer looks to immerse consumers in celebrations as company research found this holiday season is all about “revenge living.”
The free newsletter covering the top industry headlines
