Why Kroger Precision Marketing Wanted a Full-Funnel Reset
As retail media grows and shifts, having the right organizational structure to identify, seize and scale opportunities is critical.
Kroger Precision Marketing (KPM) took significant steps earlier this year to unify its internal teams, bringing together Kroger's consumer insights, loyalty marketing and retail media businesses with its 84.51° data science arm. The move was less about patching a leaky roof and more about elevating their value prop to both brands and shoppers, according to conversations with the company at the Groceryshop industry event in Las Vegas this week.
"We really saw [the reorg] as a strategic opportunity and to rethink the full funnel of supporting brands in solving business problems — all the way through how you activate on those business problems," Christine Foster, senior vice president, commercial strategy and operations at 84.51°, told P2PI.
The shift has let KPM work more holistically with its merchandising partners in brand conversations. Each vertical has dedicated teams, while each brand has an account team that specializes in insights, incentives and retail media, with all working in support of the brand, she said.
"The brands are having that holistic conversation with Kroger and not just, 'I talk to the retail media arm, I talk to the consumer insights arm, I talk to merchandising, and they're all disconnected.' "
Foster described a "wake-up call" meeting in which a brand took on the burden of sharing feedback from the 84.51° insights team with the KPM retail media team. While not the sole impetus, it was emblematic of missed opportunities.
[Related: Learn how Kroger is building its internal AI muscle]
"That should come through us. We should be proactively connecting those dots internally first [to] truly connect the entire customer journey better for brands," she said. "As they understand the purchase signals that come through Kroger, we can help them really strategize and do something about their Kroger business in a way that comes to life through the other parts of our portfolio."
There has also, of course, been a technology component of the realignment, including ensuring campaigns can flow from insights to activation. The company points to its internal Stratum insights tool, which recommends actions that align with a brand's portfolio and media strategy, and its Propensity score, which is engineered to control for organic sales to identify incremental sales, as key.
Off-Site Expansion
The company announced last week the first major capabilities expansion as a result of the reorg, adding connected TV, audio and dynamic creative optimization for display to its off-site retail media offerings. Seeking to reduce spray-and-pray strategies and one-size-fits-all creative, the company expects the move to particularly resonate with midmarket brands.
While larger brands have called for more self-service retail media capabilities, midmarket brands often lack the staff to fully leverage them.
"Taking these steps was about making sure that every impression has maximum impact for that brand — no matter where [or when] that consumer is watching — and really getting tighter across audio and streaming," Foster said.
Audio in particular is viewed by Kroger as a growth opportunity given the amount of time consumers spend with it each day. While it's historically been a tougher channel to monetize, the company expects a managed service leveraging data science to widen opportunities.
Ultimately, Kroger views these additions as a way to personalize messages more strategically.
Personalization at scale and sharing brand messages doesn't mean every single thing has to be personalized, noted Foster. Some communications should remain broad to build equity and awareness, especially in-store; the key is connecting those broad messages with personalized ones across channels so the shopper experiences one consistent brand story from store to site to offsite media.
"There's a lot of opportunity to really rethink a marketing funnel that is actively rewiring itself," said Foster.
