How Local Grocers & Convenience Stores Can Modernize Their Marketing

Head of Platform and Media Partnerships at Bridg, Jared Luskin, delves into the innovative ways local grocers and convenience stores can modernize their marketing strategies. By leveraging data and audience insights, Bridg's platform offers solutions for brick-and-mortar retailers to target in-store customers effectively. Jared's discussion sheds light on the power of offline resolution capabilities and utilizing point of sale data to enhance retail media success. Explore more insights from Jared Luskin on modernizing marketing strategies at Bridg in this engaging podcast episode. Show NotesConnect With: Jared Luskin: Website // LinkedInThe MarTech Podcast: Email // LinkedIn // TwitterBenjamin Shapiro: Website // LinkedIn // TwitterSee Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

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  Welcome to the Martech Podcast, a member of the I Hear Everything Podcast Network. In this podcast, you'll hear the stories of world-class marketers that use technology to drive business results and achieve career success. Here's the host of the Martech Podcast, Benjamin Shapiro.

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  Welcome to the Martech Podcast. I'm your host, Benjamin Shapiro, and today we're going to discuss retail media networks. Joining us is Jared Luskin, who is the Head of Partnerships at Bridge, which is an identity resolution-based platform that focuses on point-of-sale transactions for brick-and-mortar retailers and their CPG partners. Today, we're going to talk about how local grocers and convenience stores can modernize their marketing. Jared, welcome to the Martech Podcast.

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  Thanks, Ben.

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  Well, we're going to start off with a segment we like to call Double Down or Diversify. Should marketers at grocery stores and convenience stores be doubling down or diversifying from their loyalty rewards programs?

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  I think doubling down. I mean, I think loyalty programs are around for a reason. I think it's really important to be able to better understand your customers. It's really important to be able to market to those customers, especially when you've got some information about them and you can communicate them with them directly. I think the caveat there, as I said before, is you've got to be really mindful of the expense of setting up a loyalty program, the adoption rates of those loyalty programs. In some cases, the payback just isn't necessarily there. But it is driving loyalty, whether you're a grocer, a convenience store, an apparel store, a big box store, like driving loyalty is really important from a retail perspective.

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  I think strategically loyalty is important. I think the dynamics of the program are different and this comes down to mostly analytics and attribution. Do you understand who is coming in and converting and are you able to harvest the data? Go into a little bit more detail there about how people can make their loyalty programs work so it actually is something worth doubling down on.

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  I think it comes back to really setting it up in such a way that you really understand your shopper, your customer. You know, you see these loyalty programs out there, you see some of these in convenience stores where you punch your phone number in and you immediately get signed up for the loyalty program. I think sometimes those can be challenging because there is the phenomenon that I'm sure we're all used to, which is you put in some fake data, you put in a fake phone number, a fake name, or a fake email address because you want that discount on the product you're buying at that moment in time. But it's really sort of garbage in, garbage out, right? It can be challenging to have really accurate data in a loyalty program, especially with some of the instances we discussed before around the cashier who's got the loyalty

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  card taped to her cash register, me using my mother-in-law's phone number. But it is the accuracy that I think is incredibly important there. So anything that retailers can do to ensure that accuracy, whether it's with the opt-ins and getting some validation or verification back, anything you can do to make sure that that data is accurate, has to be the foundation of that, garbage in, garbage out.

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  It's gotta be twofold. I understand the garbage in, garbage out. It's also drowning in data. And I think specifically of the grocery chains, convenience stores, like, I think it's different when you're running a loyalty and rewards program at a ice cream store where you've got limited SKUs or all the products are essentially the same. It doesn't matter whether somebody likes vanilla or chocolate. It matters how often they come in. As opposed to you're at a grocery store, there's a huge difference between somebody that buys razor blades, bourbons, and bullets as opposed to somebody that's buying fingernail polish, hairnets, and face moisturizer. How do you make sense of all of the bits of data

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  that you're getting through a loyalty program when you have so many SKUs? Am I making this up as a problem? Or do the retail media networks just solve that if you've got thousands and thousands of SKUs?

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  I think the retail media networks can help you solve that. I think it is, you know, it all comes back to whether it's accuracy of the data, garbage in, garbage out. But I think importantly, like you said, there are so many companies out there that are drowning in data. Data for data's sake is not super helpful. You've got to have a real plan and an organization set up to be able to action on that data, whether it's making decisions on merchandising, right? What products are you going to carry? How are you going to price those products? Marketing decisions based on that as well. So if you don't have the organization and the resources in-house to be able to really action upon that data, you're going to be, you're going to be stuck with a lot of data and not a lot of insight into what to do with it.

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  All right. I want to move on and we're going to flip the script here, do something that we like to call role play. And I want you to put on your hair and makeup and you're going to pretend to be the owner of a struggling grocery chain. What are you doing to improve your margins?

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  Well, it's probably a number of things. And this is a role play. I'm certainly not the expert in this, but I think you look at what some of the more forward-thinking chains are doing today, really investing in the customer experience, ensuring that you're trying to merchandise in the right way. So you're driving your shoppers to some of those higher-margin products. I mean, I think- We're seeing a big investment from a retailer perspective in private label brands because those are typically higher margin than carrying national brands. But again, I think, given the thrust of this podcast, I think retail media networks are a really important opportunity to be thinking about in terms of improving margins. Grocery, retail in general, historically fairly slim margin business. But you can look at the public filings of some of these companies,

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  and these large companies that have retail media networks, and you can see that it is much higher margin. It's not incredibly high margin in terms of the products that they're able to sell. And again, going back to that collaboration with their CPG partners to be able to drive more purchases, right? Drive more investment from consumers back into the store.

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  I think of the retail media networks as akin to the digital version of selling shelf space. And I've never worked at a grocery or convenience store, but my assumption is that if you want that, I think it's called the end cap, you're either getting enough products sold or doing promotion or lowering your price so the items move off the shelf, or you're just outright paying for the extra placement of promotion. That is essentially what a retail media network is, not only because you're getting the advertising space, so you're more present, you're building your brand, you're staying in front of your consumers, but also aren't the grocery stores and convenience stores putting their thumb on the scale? Like, if you're going to be my media buyer, if you're going to buy my ad inventory,

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  I'm going to give you some premium placements or just find other ways to help you sell your inventory so the conversions look better, so you come back and buy my media.

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  I would almost flip it around. I think in a lot of cases, what you see with the larger retailers and therefore retail media networks is a, and sort of almost like an obligation to invest in the retail media network in order to kind of carry those products or get great product placement on the shelves. I don't think they're necessarily putting their thumb on the scale in terms of like the measurement of the effect of the efficacy.

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  I more mean the placement.

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  Yeah, I think it's more the opposite, right? Where you're getting retailers who are having obligations put on their CPG partners to invest in those retail media networks, right? And obviously, those larger CPGs, they're the ones who are going to have the investment dollars to spend, the budget to spend. They're going to be the ones who are typically going to get great product placement and shelf placement anyway because they are the biggest brands, the most popular brands from a consumer perspective.

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  I guess I'm just saying if I'm an engineer at Walmart and I'm responsible for the retail media network and maybe I know the person that is responsible for our algorithm that figures out where your products are placed when somebody conducts a search, maybe I ask the person sitting next to me to build in a variable into the algorithm that takes into account what my media spend is and impacts what my rankings are. If all things are even, shouldn't we be promoting the people that are buying our media more than the people that aren't? Nah, it just seems like something that's logical.

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  I think it seems logical, but I would not suggest that those large retail media networks are doing something like that, right? I mean, I think it is, clearly there is ad space sold for onsite media at some of those big retailers' websites, not unlike search advertising or programmatic advertising. As an advertiser, you're bidding. If you're willing to pay a higher price for that CPM or that CPC, you're going to get better placement of your ads at least. And I do think there's a pretty firm line drawn between what you would call like organic search listings and paid search listings. I don't think I would suggest that anybody is doing anything funny there in terms of those organic listings and bubbling up results based on investment levels on the retail media side.

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  It's just one of those things. I think about the alignment of incentives and if I am working at the Amazons or the Walmarts and we're trying to drive more media sales, I want people to have more conversions. And so influencing what is happening with the organic listings is a way to do that. Obviously, not something I can prove, not something you can either, but let's just say I've said my piece and we'll move on. Our next segment, we're going to call Crystal Ball. And what I want you to do is look into your crystal ball and tell me what you think is the biggest opportunity for CPG companies five years from now.

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  I will go a little shorter in. I think it's opportunity probably three years out, or maybe even closer in than that. I think one of the really interesting things from a retail media perspective and a retail data perspective is, again, we've talked about the fact that there are a lot of these large retail media networks out there, right? Big box stores, et cetera. I think one of the areas that is kind of lacking from a consumer purchase data perspective today is convenience stores. It is a much more fragmented market. You've got in the US, right around 150,000 convenience stores, like true convenience stores. That number increases if you take into account some of the other small format stores that are out there. But you don't have this consolidation that you do have in the grocery space, especially

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  with some of the mergers and acquisitions we've seen recently. So I think that is a spot for CPG companies to really be thinking about because while there are certainly a smaller number of products sold in those smaller format stores for obvious reasons, you've got beverages, salty snacks, candy, mint and gum, things like that, the frequency of convenience store purchases is kind of off the charts, right? You think about grocery store typical behavior, you're going in on a Saturday, you're doing your weekly stock up. Convenience stores, the average purchase frequency is more like five times a week on average. Some of those are a lot higher. So as a CPG marketer, you've got that many more opportunities to put your message in front of that convenience store shopper and change their behavior. Drive an incremental sale, drive an incremental trip. So I think

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  that's one of those areas that we see a huge opportunity for CPGs to be thinking about, given the fact that A, there's not that much data out there today, and B, just given the frequency of those purchases.

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  Yeah, it's interesting that convenience store shoppers are at their convenience store. It makes sense. You go to the corner store for your milk and maybe your bag of Doritos every once in a while, depending on how old you are. But you're doing that on the regular. You're always there for something as opposed to you go to the grocery store once a week and you buy everything that you think you're going to need. There's an aggregation or disaggregation problem with convenience stores. 7-Eleven being the biggest chain, and I think they acquired, it's not Quickie Mart, that's from The Simpsons, but there was another change that was Quickie Convenience or something like that, that was an acquisition. But there's also like Joe's Convenience Store on the corner. How do you aggregate the demand outside

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  of the sort of one conglomerate in the convenience space?

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  It's not easy to do. We at Ripple are pretty fortunate. We've got some great partnerships with POS hardware and software providers that are really well penetrated into the independent convenience store market. So we partner with National Retail Solutions, we partner with PDI Technologies, and we are able to aggregate up a pretty significant number of those independent convenience stores, which again, as I talked about, there's a general lack of convenience store data out there, especially as you think about those independent convenience stores. And today, we've got nearly a third of all of the convenience stores in the US are part of the Ripple platform.

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  There's this aggregation of demand for CPG marketers, which you can buy through tools like Ripple, getting your regional media networks, or Amazon and Walmart with your retail media networks. What are some other things that marketers that are not in CPG can take away from what's happening in the CPG space?

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  Well, I think it's really interesting, too. I mean, we see usage of our audiences by non-demic advertisers as well. So I mean, non-CPG is looking at purchase data as an indicator of somebody that might be interested in buying their products, right? So you can look really interestingly at what are the products that people are buying and use that as a way to sort of think about that persona. Are they a bargain shopper? Are they buying higher-end sort of premium products? And think about how that translates out to other marketers that are not CPG companies. I mean, I think the other thing that's really interesting, too, is for a long time, marketing has really been driven by this notion of personas, right? My target market is men aged 25 to 45, soccer moms, things like that. I think what the

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  CPGs are now finding, now that the data is becoming sort of more available from like a targeting perspective, from a measurement perspective, is you can be a lot more precise, because it is not sort of building these models of who your ideal customers are, but you can actually see, like, what are these people buying? And the reality is, when you're looking at purchase data, you are looking at people who you know have money, they are making actual purchases, right? And so you can start to hone in on more specificity, I think, around who you are trying to market to and who you're trying to target, as well as that backend measurement capability, because you've got the actual transaction data to be able to see what somebody bought.

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  You know, it's a really interesting idea that marketers that are not focused on CPG products can still do their targeting based on purchase behavior, based on other products. I am somebody that's trying to sell professional services to men 25 to 35. I might be buying, looking for people that are buying Mountain Dew and Doritos. And that's a good signal. We often are thinking about our targeting in terms of a digital footprint, a signal, something that we can grab onto that says somebody is in market. And often, our purchase behavior is one of the best signals we can find. So that wraps up this episode of the Martech Podcast. Thanks for listening to my conversation with Jared

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  Luskin, the Head of Platform and Media Partnerships at Bridge. If you'd like to get in touch with Jared, you can find a link to his LinkedIn profile in our show notes, or you can visit his company's website, which is bridg.com. It's B-R-I-D-G, no E, B-R-I-D-G.com. Just one more link in our show notes I'd like to tell you about. If you didn't have a chance to take notes while you were listening to this podcast, head over to martechpod.com, where we have summaries of all of our episodes and contact information for our guests. Of course, you can always reach out on social media. Our handle is @martechpod on Twitter, Instagram, and Facebook. You can contact me directly. My handle on LinkedIn is Ben J. Shap, B-E-N-J-S-H-A-P. You can also find full-length videos and social clips on YouTube

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  by searching for Martech Podcast. And if you haven't subscribed yet, and you want a daily stream of marketing and technology knowledge in your podcast feed, we're going to publish an episode every day this year. So hit the subscribe button in your podcast app, and we'll be back in your feed tomorrow morning. All right, that's it for today. But until next time, my advice is to just focus on keeping your customers happy.

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  Thanks for listening to the Martech Podcast, an I Hear Everything production. Looking to launch or scale a podcast like this one for your brand? Then visit iheareverything.com.