Top 6 Mistakes Brands Make When Allocating Retail Media Budget - Episode 237
INTERVIEW WITH MATTEO BIZON
DESCRIPTION
In today’s podcast, we are talking with Matteo Bizon about retail media budget allocation and the top 6 mistakes brands make with their allocation. Kiri and Matteo discuss the different possibilities as well as traps brands fall into. Bobsled’s latest research suggests a better way to allocate retail media budget - by funnel stage! You can find the link below, or 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.
“There needs to be a more coordinated approach [that] results in a well-oiled machine where everyone is collaborating towards the company’s end goals.”
KEY TAKEAWAYS
Mistake 1: allocating retail media spend based on historical channel sales.
A significant percentage of brand Bobsled collaborates with allocate retail media budgets based on past performance.
This approach might be the cause of excessive “rigidity” in the approach towards budgets as it leaves little room for experimentation not only in terms of trying to advertise on new platforms, but also within the platforms that brands are already using.
Additionally, this could result in a potential misalignment between the overall company strategy and the actual advertising implementation by always prioritizing where more revenue is generated, but leaving out good opportunities to generate awareness and consideration.
Mistake 2: not allocating a test-and-learn budget
This is essential to being able to jump onto new opportunities.
Tip: once a test-and-learn test has proven successful, immediately move that spend into the business’s usual budget.
Mistake 3: Extreme platform focus instead of looking at the bigger picture.
Speaking with several brands, we discovered that in several cases the performance on each platform falls under the responsibility of different teams. However, given that these teams often fail to share their knowledge or have to compete for budgets, this can be an issue.
There needs to be a coordinated approach where everyone is collaborating towards the company’s end goals.
Mistake 4: making ROAS or ACoS the default target metric.
It is a metric that is easy to calculate and is universal, and it is overused because it is so available.
If your aim is to grow market share, category share, etc. you don’t want to focus on these metrics since they aren’t growth metrics.
Mistake 5: Getting lost in the multitude of metrics made available by each platform.
Each retail media platform provides different levels of reporting and metrics in terms of advertising (Amazon DSP, Amazon pay-per-click and Instacart, for example give different insights).
All of this can be confusing for most brands, which can potentially result in losing sight of the most important metrics.
Brands should focus on the core digital advertising KPIs and evaluate the cost for each action: impressions for awareness, clicks for considerations, and conversions for purchase and loyalty.
Mistake 6: not knowing the objective of the brand, the channel, or product subset.
These different objectives require different investment, and different behaviors:
Growth - spending more on ads, running ads that are impression-based.
Profit margin - focused more on profitable ad types.
Bobsled’s latest research suggests a better way to allocate retail media budget - by funnel stage! You can find the link below, or go to bobsledmarketing.com, find “resources” and sign up for the report and webinar that will be out on May 19th.
MENTIONED IN THIS EPISODE
Connect with Kiri Masters
Connect with Matteo Bizon
Learn more about Bobsled Marketing, an Acadia Company
Register for the Retail Media Budget Allocation report and webinar
