One of the nation’s leading grocery brands, Kroger, has entered the retail advertising arena. With sights set on rivalling the billion-dollar Amazon and Walmart advertising platforms, Kroger expects their efforts with a programmatic advertising platform are especially apt, thanks to the expertise of data analytics subsidiary 84.51°.
The grocer already reaches more than 60 million households across the nation with weekly ads and a circular focused on grocery specials, deals, and exclusive offers. The company now looks to leverage that immense reach with the sale of valuable inventory to advertisers who want a share of Kroger’s impressions.
In addition to an extensive grocery carrying the brand name, Kroger owns a large swath of other recognizable retail brands, including Harris Teeter, Smith’s, City Market, and Fred Meyer Jewelers, just to name a few. The brand raked in nearly $28 billion in sales last year alone, for a jump in growth of 4.5% when compared to the previous year.
Delivering these relevant and targeted ads is expected to add yet another lucrative revenue stream to the Kroger name. Kroger has gone in on their media business with its share of Dunnhumby to form a consumer insights subsidiary powered by subsidiary 84.51°.
The Role Of 84.51°
84.51° has taken the lead in Kroger’s ad enterprise and looks to develop ad formats and manage ad sales for Kroger along the same lines as Walmart’s Triad Retail Media platform. More than 95% of Kroger’s sales can be tracked to specific customers, allowing for highly-targeted product placement and a more efficient funnel towards conversion.
The platform is called Kroger Precision Marketing and adopts a customer-first approach to building relationships and targeted communications using consumer data derived from Kroger’s list of loyal shoppers. The incremental sales plan has three defined frequencies for advertisers to choose from. The first employs advertising on Kroger’s own brand marketing channels, allowing advertisers to market their products on Kroger.com and through Kroger’s own customer email database. The second is referred to as word-of-mouth marketing and encourages Kroger’s online community of shoppers to try products for free and share their opinions with a wider audience, increasing brand exposure and generating consumer-driven conversation. Finally, Kroger online advertising delivers targeted communications using co-branded media campaigns created especially for customers in a digital space.
The suite of products provided by Kroger Precision Marketing includes targeted email modules, targeted digital coupons, unique brand pages on Kroger.com as well as hero spots and ad blocks on Kroger.com. The brand will launch its boosted products service soon as well.
Established in 1883 by Bernard Kroger, Kroger is considered the largest supermarket chain in the US with more than $115 billion in revenue reported for 2016. In terms of retail, it is the second largest brand in the US, bested only by Walmart, and the third largest in the world. Kroger stands as the 23 largest company in the US and the third largest employer in the country with nearly 2,800 supermarkets and multi-department stores in operation.
A privately owned subsidiary of Tesco, Dunnhumby had humble beginnings as the 1989 brainchild of Edwina Dunn and Clive Humby. Working clients like cable & wireless and BMW in their Chiswick, London home, the two reached prominence after helping Tesco erect their Tesco Clubcard membership program and securing a £30 million bid from Tesco for 53% of the company. Tesco split with Dunnhumby to create a 50-50 split with Kroger in 2015, the firm 84.51° was born shortly after.
Founded in 2015, 84.51° has dedicated its efforts to a customer-first and long-term approach to data analysis. With a focus on driving growth and enhancing customer loyalty, the brand has found success in partnering with brands like Kroger to serve as a data detective for massive retail operations. Beyond their largest partner, Kroger, 84.51° serves other notable brands, including Time Warner Cable, Tyson, Energizer, Hallmark, and Nestle, just to name a few. Mixing innovative approaches with new and traditional media, 84.51° has created a position in the market based on case studies and data insights that have garnered recognition from several major US and international conglomerates.
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