Roku teams with Kroger to integrate shopper data and streaming TV ads

Dive Brief:

Roku launched a new shopper data program that is designed to improve targeting and measurement of TV advertising for CPG marketers, with Kroger Precision Marketing (KPM) joining as a launch partner, the streaming platform announced in a press release.
KPM, the grocery store chain's media advertising business arm, brings data from 60 million households across approximately 2,800 Kroger stores to Roku's shopper data program. The information will help CPG marketers better target ads that run on Roku's platform and tie ad exposure to online and in-store sales.
Roku had 39.8 million active accounts as of Q1 2020 and 13.2 billion hours streamed during the period.

Dive Insight:

As more consumers cut the cord in favor of over-the-top (OTT) TV streaming services, marketers are taking a closer look at the potential of video ads to drive a customer purchase. Television, a broadcast medium, is often overlooked in attributing sales conversions, but partnerships like the one between Roku and Kroger aim to address this issue, and it comes as both entities have been ramping up their digital advertising programs.

Attribution has long been an issue in the digital marketing industry, as marketers have difficulty knowing which ad, email or mobile notification generated a sale, for instance. Relying on last-click attribution causes tensions within marketing departments and may not correctly attribute where funds should be placed. Kroger's partnership with Roku extends the retailer's attribution offering to OTT ad streaming in a move to improve sales attribution for CPG brands placing ads on Roku's network.

CPG marketers will be able to use data to track the effectiveness of TV advertising on sales and use these insights for future marketing. Using Roku's platform integrated with KPM's data, for example, marketers can segment messages based on how often a customer purchases from a particular category.

With Amazon's advertising business quickly growing — in part because of the power of transactional data to support CPG marketing — other retailers like Ahold Delhaize, Walmart and Target are exploring building their own digital media offerings for advertisers. In February, Kroger extended its self-service advertising platform with a new attribution tool to give brands better transparency into their ad spending across the retailer's properties. The Roku integration will do the same thing for streaming ads.

For grocers, advertising can be an additional source of revenue and give them insight into their shoppers to effectively reach their audience. Kroger also uses its loyalty card and e-commerce purchases to collect consumer data. In 2015, it purchased dunnhumby's data assets to create its own consumer insights subsidiary called 84.51º.

The digital media space based on retail transactional data has continued to expand, including reports that CVS launched a digital ad network and online grocery company Instacart debuted a self-serve ad platform that lets marketers promote products in search results.

Roku kicked off its new OneView ad platform last month with launch partners Drizly, Experian, Intuit TurboTax and Lexus. The ad platform is designed to help advertisers use TV identity data to create ads across OTT, desktop and mobile from a single hub.