Attribution please

Marketers from Nestle, Pepsico, Baiada and Jacobs Douwe Egberts were among a slew of supermarket suppliers who proffered conditional support in Mi3’s 2023 Retail Media Report for the charge by supermarkets here to build their own media and advertising units. 

If Australia’s two big grocery chains, Woolworths and Coles, cracked measurement systems that could prove ads across their various media assets directly triggered sales uplift, “that gets people very excited” said Aaron Wall, marketing manager for coffee giant Jacobs Douwe Egberts, at the time.

Yash Gandi, CMO at Steggles and Lilydale Free Range parent Baiada, said his business last year had not yet increased its budgets into retail media but if grocery chains could robustly demonstrate ROI and isolate incremental sales from their various advertising channels, it was the “missing link…that will certainly make things interesting. Can you link what was seen on a screen, point of sale, to the product that was purchased…?” 

Australian brands now have their test – Coles 360 unveiled the first phase in its measurement platform which was built after ongoing consultation with supermarket suppliers on what they needed to move the needle for higher advertising budget allocations to the Coles media network. 

Alistair Leathwood, APAC Head of Analytics, Insights & Media at Circana, which works with retail media networks globally, is “pretty certain nobody else in the world has got the complete suite of solutions” he now said are housed within the Coles 360Impact initiative. 

And if Australia follows the US, 20 per cent of the $14bn ad market here could be captured by retail media networks in the not too distant future. “Generally the retail media industry is going crazy,” says Leathwood. “The growth rates are spectacular.”

Coles 360 GM Paul Brooks acknowledged when launching the retail media business that Coles was lagging the Woolworth’s Cartology operation by four years. But he said it would come to market with a different approach that would address supplier frustrations, including sales measurement and attribution from their ads.

Big hairy questions

“We've started with the big hairy questions around measurement and attribution,” Coles 360 Head of Measurement and Data Intelligence, Andy Ford, told Mi3. “360Impact is there to evolve. We’ll add things in there as we build out the capability but to start with, the big hairy questions from our suppliers were very much around ‘can you tell me sales incrementality? Can you tell me that across all the [Coles] channels that I buy? Can you also give me optimisation within certain channels as well?”

At the core of the first phase of the platform is the alliance with Circana in which control groups are set up for its addressable media (online shopping and loyalty members) and one-to-many channels like in-store digital screens, radio and supermarket aisle activations.

Since launch, Coles has delivered reporting on 1,500 campaigns based on more blunt post-campaign analysis of ads and sales data. Now, in Ford’s words, retail media measurement moves “to causal inference”. 

Circana’s Leathwood says it’s why retail media networks are surging in the US and Europe although measurement systems among European retailers are less sophisticated and more restrained by privacy compliance than the US.  

Closing the customer loop

“It just informs that level of confidence that suppliers have got the feedback loop – the closed loop [from ad exposure to purchase],” he said. “And they can actually action it and do things with it, as opposed to not getting that with possibly some of the other types of media that are out there. Having the closed customer loop is a big deal for them. If we can control for all the other variables … either at a store level or at an individual level, then you can be be 99 per cent certain that what you are seeing is the effect of the campaign. I understand that that might feel like it's the bottom end of the [purchasing] funnel but at the end of the day, the reason why you're spending a million dollars is to sell more stuff, either in the short or the long term. That's what you want to measure and that's what we can genuinely do with this solution.”

Mars Pet Nutrition’s Shopper Marketing Director, Ana Laskova, said the intent from Coles 360Impact on its reporting is what her business needs from retail media networks. 

“We want to understand holistic shopper behaviour and get granular data on which retail media mix is most effective in driving engagement and conversion both online and in-store,” she told Mi3. “We want to assess this against short term metrics such as incremental sales and share uplifts, shopper type and longer term metrics such as consumer lifetime value.”

Laskova was at last week’s supplier briefing and said Coles 360Impact will “provide us with deep sales insights and impact our ability to craft omni-channel campaigns that better connect the path between inspiration and purchase."

But she still sees room for the next phase: "Ultimately we would love to see a centralised dashboard with standardised data metrics that provide real time insights into campaign performance.”

Ford said he's already on it: a near-real time self-serve reporting platform would launch in the next 12 months. 

But for now, does the new Coles 360Impact measurement initiative provide Mars with the reassurance to hold or increase its current trade marketing investments? It's a qualified yes.

“Given retail media is still in its early stages, we will need more time to test and learn and demonstrate that our investments are delivering the right outcomes,” Laskova said. “We look forward to strengthening the partnership with the Coles 360 team as we work more closely with them to deliver the results.”

Ford cited two unnamed pilot studies with confectionary and pantry suppliers using the new 360Impact test-control methodology – the first saw a 66 per cent sales lift in the test group versus the control sample and in the pantry pilot, the campaign saw a 29 per cent lift in “non-category” buyers. “We got people into the category that weren’t there for the previous six months,” Ford says. “There are a few ways you can get a lift in sales – it could be more people shopping more often [or new buyers into the category]. We can answer that question quite clearly with this.”    

Either way, Ford said Coles 360's new “gold standard” reporting platform will also cover “off-network” campaigns, primarily with Meta and YouTube to date – a point Laskova said Mars is “excited about”, particularly the Meta partnership with the “ability to reach our audiences in another fun and measured environment.”

Now to see if other marketers take up the tools and shift more budget.