What CPG Brands Need to Know About Advertising on Kroger

There’s no question that the pandemic has accelerated ecommerce and online grocery adoption. People are shopping from the comfort of their homes more than ever. They’re less worried about being able to choose their own produce and more concerned with safety and convenience. This has created new opportunities for CPG brands to scale their online advertising efforts across retailer sites and platforms.

Source: Kroger Precision Marketing, Charting a Course to Success With Your Retail Media Partners, New Commerce Conference, 12/16/20. View full presentation.

Which retailers should brands be looking at when determining how to invest their ecommerce and retail media budgets? Marketers would be wise to take a close look at Kroger.  

Kroger made headlines at the end of 2020 when it broke into the top ten ecommerce companies by sales for the first time. The grocery giant clinched the no. 9 spot with eMarketer predicting that Kroger’s ecommerce sales were set to surpass $11 billion in 2020, growing by an estimated 79% year over year.

Though impressive, Kroger’s growth is not surprising given its dominance in the grocery market. Kroger is the U.S.’s leading supermarket chain. Out of approximately, 120 million total U.S. households, 60 million households shop Kroger, meaning that with 1 in every 2 U.S. households are Kroger shoppers. Additionally, 98% of Kroger households have access to pick up and delivery1.

Kroger’s status in the physical grocery space, combined with the surge in its ecommerce business, is creating opportunities for brands and marketers to acquire new online customers and drive sales.

If you haven’t thought about expanding or enhancing your digital shelf presence and brand awareness at Kroger, now is the time to start strategizing. Optimizing your product pages and advertising on Kroger could be your next best ecommerce move. Here are some key considerations and tips for getting started.

Kroger Product Detail Pages

There’s a saying I love to share: “Paid media will bring the traffic, but it’s the content that will make the conversion.” This has been my mantra when helping brands optimize their ecommerce presence, and it rings true for Kroger too.

Brands should strive for an integrated approach to brand marketing and performance marketing on ecommerce sites, including a significant focus on product detail page (PDP) optimization. Given PDPs’ large influence on shopping and purchasing decisions, brands cannot afford to leave PDPs as an after-thought.

Catalyst and Kantar’s State of Ecommerce 2021 report revealed that online purchasers ranked PDPs as the most influential touchpoint on their purchase. The content on these pages should be informational and influential, so customers feel compelled to add that item to their cart and checkout.

Here are some ways to elevate your PDPs on Kroger.com:

  • SEO: Add image alt text, keywords in image file names, and keywords in the product title and description to help the PDP rank higher on Kroger.com and traditional search engines like Google.
  • Images: Ensure the main product images are high-res with a white background, so shoppers can clearly see elements like the product label and nutrition label. Alternate (lifestyle) images can show the product in use in an environment.
  • Featured bullets: This is the perfect chance to provide easily digestible details and give customers a quick snapshot of the product.
  • Product description: Think of this section as your opportunity to really let your brand and product shine. Focus on storytelling, so shoppers feel inspired and clearly understand why they should buy your product.

Once PDPs are optimized, you’ll be in a better position to get the best results from any paid media running through Kroger Precision Marketing and 84.51.

Paid Media Offerings & Opportunities

Kroger is the largest pure play grocer, and its advertising capabilities are impressive. Kroger Precision Marketing (KPM) is powered by 84.51°, both of which make up Kroger’s advertising arm. Kroger’s full media offering includes things like on-site advertising, email, search, advanced TV, as well as social and influencer opportunities.

But what sets KPM apart is its ability to target shoppers based on first party data and sales measurement. According to Catalyst and Kroger’s New Commerce Conference session “Charting a Course to Success with Your Retail Media Partners,” a whopping 96% of Kroger transactions are captured on the Kroger Plus Loyalty card, making it possible to track in-store and online sales and provide incremental sales lift data1.

Kroger brings so much sophisticated measurement to the table that, according to Catalyst and Kantar’s State of Ecommerce 2021 report, ecommerce professionals rate KPM as the top platform in ability to measure ROI. Among ecommerce professionals who used Kroger advertising in the last 12 months, 93% indicated that they were able to measure ROI very well or moderately well on Kroger.

Getting Started with Paid Media: Kroger Product Listing Ads

If you’re wondering where to start when it comes to paid media, we recommend running product listing ads (PLAs) as a first step.

Powered by Microsoft’s PromoteIQ, PLAs will boost your products on Kroger.com, making them visible to shoppers whether they’re searching for your brand or not. PLAs are also a great way to protect and defend your brand from competitors who may be trying to capture your shopper at the last stage of their journey.

Keep in mind that 85% of keywords are unbranded on Kroger, so if you’re looking to grow and convert new shoppers, this is your space. Advertisers are seeing as high as 300%-600% return on ad spend with Kroger PLAs1. Here are a few tips for managing PLAs:

  1. Ensure you have ample inventory, as out-of-stock items cannot be promoted.
  2. Have a solid bidding strategy to maintain competitive CPCs and maximize return.
  3. Pause items that begin to spend too much but have a low return, unless your goal is awareness and high spend is fine as long as impressions are also high.

Positioning Your Brand for Success on Kroger

Ultimately, the success of any of your advertising tactics on Kroger will lay in your ability to inspire shoppers at each stage of their journey. Find ways to connect with consumers on their Kroger journey so that they are more likely to become repeat purchasers of your product or brand.

And, with any space as dynamic as retail media, you must remain open to testing and experimentation. Don’t be afraid to test a new capability, ad unit, or emerging platform. It may just be what gives you an edge in ecommerce in 2021.

More Ecommerce Resources & Digital Commerce Thought-Leadership from Catalyst

1Kroger Precision Marketing

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