Dive Brief:

• Albertsons has launched its own retail media network to develop digital ads and other branded content for CPG companies, according to a press release on Thursday.
• Albertsons Media Collective will be led by Kristi Argyilan, who previously led Target’s Roundel ad business, and will begin running ad campaigns on February 27, 2022.
• Albertsons is winding down its partnership with media firm Quotient and forging its own media business as large-scale retailers look to boost their margins through advertising services powered by their first-party data.

Dive Insight:

In the announcement, Albertsons said its new media network will offer native display and sponsored product listings across its digital properties, including its app, pharmacy, homepage and category pages for online shopping.

In an interview with Business Insider, Argyilan said that, in addition, Albertsons Media Collective will offer local advertising to CPG companies — a service other retailers don’t offer. The media shop, which the retailer developed alongside CitrusAd and Merkle, also aims to look beyond the Albertsons ecosystem and pitch advertisers that don’t sell products in its stores, like auto makers, and explore partnering with connected TV and video companies.

Like other retailers that have launched retail media firms, Albertsons is relying on the trove of first-party data it collects on shoppers to fuel the new business. The company has focused on building membership to its Just for U loyalty program, which now has more than 27 million members, as well as its ranks of online shoppers through leading initiatives like livestreaming and a partnership with Pinterest.

Albertsons will be competing for CPG spending with numerous companies that have their own media networks. This includes Kroger, which launched Kroger Precision Marketing in 2017 and recently unveiled a programmatic marketplace for advertisers, as well as Instacart, which has a self-service platform and reaches across numerous retailers. 

But the size of the prize is substantial and growing. Eighty-one percent of CPG brands plan to boost their investment in retail media over the next year, according to a Merkle report recently cited by Ad Age. Digital research firm Forrester, meanwhile, predicts that retail media sales will reach $50 billion globally next year as advertising that relies on first-party data becomes “mission-critical” for marketers.