A Primer on the Kroger’s Retail Media Network, Kroger Precision Marketing

As the lead of Acadia’s retail media expansions, I frequently get asked about up-and-coming advertising channels beyond stalwarts like Amazon and Walmart. One retail media network that more brands are inquiring about is Kroger. 

In this video interview I did for the Ecommerce Braintrust podcast, I share a high-level overview of Kroger's retail media capabilities. Below the video is a summary of that conversation. And if your brand is looking to ramp up with Kroger ads, you can learn more about our Kroger advertising capability.

What is Kroger's Retail Media Network?

Kroger Precision Marketing (KPM), is the retail media unit of grocery giant Kroger. In June of 2023 KPM announced announced that it has been in-housing its self-serve advertising platform, which had previously been running on Microsoft’s PromoteIQ. In October 2023, the new self-serve ad platform was launched. 

Kroger’s new ad console allows brands to promote products across Kroger’s family of grocery brands like Ralph’s, Fred Meyer, Marianos, and more.

Kroger, as the largest grocery retailer in the US, has been focused on leveraging this huge competitive advantage by building a robust first-party shopper data set. This allows for more advanced audience targeting compared to some other grocery retail media networks.

Key Advertising Formats

The two main ad formats available in a self-serve capacity are sponsored product ads, similar to Amazon, and display ads.

Product Listing Ads (PLAs) are the standard “sponsored product” ads that are displayed in search (“search and browse”) results, but also in “basket builder” and “savings” (coupon) environments.

Targeted Onsite Ads (TOAs) is akin to a sponsored brand campaign, basically a banner ad. And pleasingly, we have quite a lot of control of the creative, as well as the click through destination.

We expect that Kroger will also expanding into new formats like shoppable videos and ads on digital receipts.

In addition to the native capabilities for bidding and campaign management, Acadia also uses our ad tech tool Pacvue for enhanced analytics and automation. This gives brands more control and reporting visibility.

Advanced performance creative options for advertising

One aspect of Kroger’s retail media network that I’ve been really impressed by is  robust creative capabilities. Advertisers can easily customize creatives for different placements, with the ability to tailor the imagery, headline, and call-to-action for each ad size and location. 

For example, a brand could create a carousel ad for the web homepage and then modify the headline and CTA for the mobile homepage placement. The intuitive interface makes it simple to upload images and choose from many different CTA options to find the optimal combination. Compared to other RMNs,  Kroger’s ad builder allows agencies to test many more variations to determine the highest-performing creative approach. This increased ability to experiment with different creative elements provides brands with impactful insights to refine their advertising.

Challenges with Kroger Precision Marketing

One major difference between Kroger’s self-serve ad capabilities and Amazon is that Kroger does not offer  keyword level bids. Instead, we bid at the product or category level, and Kroger uses contextual targeting to reach customers who are relevant to that product or category

This offers less control than a keyword-level bidding model, so we need to lean into any "bid modifiers" that are available, such as negative keywords. Still, this lacks visibility into performance by keyword. So overall ad campaign optimization can be more challenging than on Amazon. 

Why Kroger is Worth a Look

Here are some of the advantages I see in Kroger as an emerging retail media network:

  1. Ability to target ads at the store level could be very compelling for the right use-case.  
  2. Large scale as the largest grocery retailer in the US.
  3. Has built its own rails rather than relying on a 3rd party tech - this creates the potential for a lot more innovation in the future.
  4. Intuitive, buildable options for ad creative, so we can run many more tests than on other platforms and identify the best performing messaging.  
  5. Kroger does have a DSP (demand side platform) which opens up a whole array of new audience targeting capabilities for brands, especially those who want to build brand awareness.
  6. We imagine that Kroger will make it easier over time for brands to correlate outcomes from their online and in-store retail media activations with actual sales outcomes.  

While the platform is still maturing, competition is lower than I predict it will be in the future. I suggest brands start testing now to take advantage of lower costs and available inventory. If your brand is looking to take advantage of Kroger’s retail media network, reach out to us

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Damiano Ciarrocchi