Retail Media: A New Budget Allocation Model - Episode 238
INTERVIEW WITH MATTEO BIZON
DESCRIPTION
In today’s podcast, we are talking with Matteo Bizon about how to allocate your retail media budget. Retail media is the hot topic of the moment with more and more options available and lots of opportunities to reach shoppers. However, your marketing budget is not growing at the same pace as these opportunities! Which channels are ‘worth it’ and which are a waste of time? Which channels do you fund first?
Bobsled’s latest research suggests a better way to allocate retail media budget - by funnel stage! Go to bobsledmarketing.com, find “resources'' and sign up for the report and webinar that will be out on May 19th.
Make sure you tune in to find out more!
Matteo is a PPC specialist at Bobsled. He became passionate about digital advertising while studying marketing management at university and immediately started experimenting by launching his own website project and helping a friend start an ecommerce business for his clothing brand. After working for an Italian digital marketing agency, he joined Amazon where he learnt Amazon advertising in a client-facing role. Looking for more challenges and knowledge around advertising on Amazon, Matteo joined Bobsled where he had the opportunity to discover more advanced techniques and refine his skills.
“If I look at the overall landscape of answers that we have received from the people we talked to, the aspect that strikes me the most is a pervasive sense of rigidity.”
KEY TAKEAWAYS
There are two main methods of allocating retail budget right now:
Allocation by retailer or advertising platform: considering the gross revenue that a given retailer or platform generates for the brand as a percentage of overall revenue, and then allocating a media budget that corresponds with the revenue contribution.
Allocation by key metrics: this approach is to identify target metrics to achieve (particularly profitability-oriented metrics like target ROAS), and allocate spend to various channels or ad types based on over-performance or under-performance of these metrics.
On the one hand, these approaches are easier to implement because they are somewhat easier to calculate. However, in our report we point out there are things to look out for in order to get accurate reporting.
On the other hand, these might be the cause of a strong misalignment between the strategic goals and the implemented campaigns of a given company and can also lead to missed opportunities for the overall company strategy as far as retail media is concerned.
At Bobsled, now part of Acadia, we’ve come up with a new model for media allocation that resolves these issues:
We look at data and challenges from different angles to understand if any alternative approaches might be more accurate and could give us more insight.
We started looking at the bigger picture, trying to integrate all our advertising efforts across different platforms to achieve each brand’s ultimate strategic goals.
We cataloged each ad type and targeting option made available by the platforms we provide support for (mainly Amazon pay-per-click, Amazon DSP, Instacart ads and Walmart ads) and segmented them by their purpose according to the classic marketing funnel.
In our framework, we show how each ad type and targeting option is connected to the funnel stages of awareness, consideration, purchase, and loyalty.
This new approach has proven to help brands identify precisely the missed opportunities mentioned earlier and might be a very effective solution to ensure the alignment between the company’s strategic goals and the practical implementation in terms of advertising.
The most striking thing that came up in conversations with digital/ecomm leaders at brands is this pervasive sense of rigidity. In several cases we noted extremely siloed structures within organizations, but retail media requires much more flexibility. The companies that solve this challenge with a more agile approach will be the ones to succeed in the long run.
Sign up for the research and full walk-through of this model at bobsledmarketing.com, find “resources'' and sign up for the report and webinar that will be out on May 19th.
See the full framework for Amazon, Walmart and Instacart.
Get tips and strategies from other mid-market consumer brands.
MENTIONED IN THIS EPISODE
Connect with Kiri Masters
Connect with Matteo Bizon
Learn more about Bobsled Marketing, an Acadia Company
Check out Episode 237: Top 6 Mistakes Brands Make When Allocating Retail Media Budget
Register for the Retail Media Budget Allocation report and webinar
