Grocery Store Madness: How to Save Ad Budget With Smart SKU-Level Targeting

Key Takeaways: 

• Consumer behaviors shifted during the pandemic and could become permanent.
• Too many CPG advertisers waste ad dollars targeting store locations where their products are out-of-stock.
• Only CPG brand categories equipped with data-driven tools and flexible strategy will win back market share and consumer trust.

Consumer demand for products peaked during Covid-19 and a lack of real-time SKU-level retailer data kept many advertisers in the dark on inventory cycles, creating marketing paralysis and highlighting substantial weaknesses within the CPG supply chain. 

Even before the pandemic, CPG brands were already losing an estimated $2.9 billion to media waste through ineffective channels and strategies. Shoppers at major retailers typically encountered an out-of-stock product every third visit, resulting in a loss of $23 million for every $1 billion in CPG sales. That translates into 26% of their marketing budget thrown into the shredder.

While U.S. grocery spend spiked 15% in March as the pandemic hit, contributing to a $9 billion increase in CPG sales during the last two weeks of the month, the aggressive increase in product demand revealed a legacy of wasted CPG ad impressions that continue to send consumers to locations where the products they depend on are missing in action.

Future-proofing for the new consumer reality

In a post-Covid world, CPG advertisers have learned hard lessons over the last 90 days, and many find themselves in a serious bind without data-driven tools to automate and manage national budgets.

The old way of blindly targeting ZIP codes and stores where products should be available without accurate data to back up those assumptions was a surefire way of ceding valuable shelf space and ready-to-spend customers to competitors.

But today’s hyper-challenged advertisers need to quickly regain flexibility and control over supply chain issues. They need to understand where their products are available on the shelf in real-time and on a local level so they can more effectively reduce media waste, optimize ad spend, and win back market share and consumer trust.

Using Amobee’s first-to-market Dynamic Localization solution, advertisers can gain access to automated, streamlined SKU-level product availability data to dynamically allocate budgets based on location (ZIP, DMA, etc.) to make more efficient use of their marketing dollars.

Using UPC-level in-store sales and inventory data from 230+ top U.S. retailers, CPGs can better activate localized campaigns on programmatic and social to only relevant geographic areas with in-stock products, increasing campaign budget reach and accurate measurement of return-on-marketing spend. 

An uncertain future, but a much stronger brand

In the days and weeks ahead as the country establishes normalcy, the CPG advertisers that use their media dollars to accurately equate consumer demand with available supply will have a significant market advantage over competitors. 

With more control and visibility over their inventory, CPGs can rebuild trust and loyalty by connecting consumers to essential products across thousands of stores.

To learn more about Amobee’s Dynamic Localization solution, please contact us at Solutions@amobee.com, and refer to our Covid-19 CPG Restart Playbook, a prescriptive guide to helping advertisers rethink their advertising strategy and reposition their brand creative as business doors reopen. 

Also please also visit our  Covid-19 Real-Time Discovery Dashboard, which features our Brand Intelligence Trend Reports that reveal consumer behavioral changes and market share-shift during the pandemic and its aftermath.

 

About Amobee

Founded in 2005, Amobee is an advertising platform that understands how people consume content. Our goal is to optimize outcomes for advertisers and media companies, while providing a better consumer experience. Through our platform, we help customers further their audience development, optimize their cross channel performance across all TV, connected TV, and digital media, and drive new customer growth through detailed analytics and reporting. Amobee is a wholly owned subsidiary of Tremor International, a collection of brands built to unite creativity, data and technology across the open internet.

If you’re curious to learn more, watch the on-demand demo or take a deep dive into our Research & Insights section where you can find recent webinars on-demand, media plan insights & activation templates, and more data-driven content. If you’re ready to take the next step into a sustainable, consumer-first advertising future, contact us today.