Unlocking Incrementality Insights in Retail Media: Six Innovative Approaches

In the ever-evolving retail media landscape, measuring the impact of marketing campaigns is not only fundamental but increasingly challenging. As I’ve written about previously, marketers are in dire need of precise, actionable measurements to maximize their retail media investments. One of the most intricate areas of measurement is discerning which customer conversions are genuinely incremental.

The industry consensus is that the goal of retail media should be to drive incrementality. However, how to do it right is still being debated. And there is still no silver bullet for measuring measurement. Each advertiser I’ve spoken to over the past is crafting an individual incrementality approach dictated by their unique product catalogs, category competitors, and media mix. 

Below, I will examine how six companies tackle incrementality. I hope these real-world implementations will inspire and guide others looking for the right approach.

Pharmaceutical giant’s strategic advertising optimization

One leading pharmaceutical company is working to maximize the effectiveness of its advertising spending on one of its key channels, Amazon. As a foundation, they’ve enlisted a technology partner to help them calculate iROAS (incremental return on ad spend). This proprietary metric is calculated daily for each campaign and keyword, and then budget allocation recommendations are made using this data, which the marketing team then factors into its final media plan. The pharmaceutical company uses Skai’s AI-driven omnichannel platform, supported by our Expert Services and Skai Labs teams, to implement these insights.

• Precise performance tracking. The tailored iROAS metric is becoming the source of truth for incrementality measurement, tracking each campaign’s and keyword’s incremental impact and enabling fast and agile changes to the media plan based on its insights.
• Full-funnel Amazon Ads. Budget recommendations are made for Amazon Sponsored and Amazon DSP campaigns, and proprietary technology determines the right mix between ad types and tactics.

This partner-led approach empowers the company to navigate the complexities of pharmaceutical marketing, ensuring that each advertising dollar is judiciously spent.

Healthy snack producer’s comprehensive full-funnel strategy

A top healthy snack producer addresses incrementality by moving up the funnel with their media strategy. Based on their national distribution in major retailers, they feel confident investing substantially in upper-funnel activities, including broad reach and awareness campaigns and Connected TV (CTV). They have partnered with an MMM (media mix modeling) solution across channels and use Skai for API-supported publishers to manage paid media efficiently. They maintain close relationships with their retailer publishing partners and understand their end-consumers well. This approach has led to improved campaign efficiency at the bottom of the funnel and record-breaking sales lift across the omnichannel.

• Integrated marketing efforts. Now that it can accurately measure upper and lower-funnel tactics, the company ensures its marketing efforts will bolster immediate sales while building long-term brand equity.
• Enhanced analytical processes. Adopting a combination of econometrics and saturation-based analytical methods allows for continuous refinement of marketing strategies across the entire funnel, maximizing the efficiency and effectiveness of spending.

This strategic deployment has enabled the health snack producer to thrive despite the category’s challenges, demonstrating the effectiveness of a well-rounded full-funnel strategy in driving both immediate and long-term results.

Audio equipment manufacturer’s integrated media strategy

A consumer electronics company tackles incrementality by aligning all organizational stakeholders to common objectives. Their sales team has steadily gained ACV penetration and assortment expansion while maintaining a strong D2C channel by growing their product catalog with innovation at competitive price points. They have a unified media team that manages brand awareness and direct response media buys, even though budgets come from different sources internally, span roughly a dozen publishers, and exceed eight figures annually. 

Budgets are equal between awareness media bought predominantly on CPM and ecommerce media bought predominantly on CPC. Success metrics are defined in collaboration with the CFO and other stakeholders, and when success metrics are achieved, additional funding comes immediately so the teams can capitalize on opportunities quickly. Eliminating silos and reducing barriers between departments is critical, which allows the company to work more closely with retail and technology partners. They collaborated with Skai on a closed beta with a leading Amazon Marketing Cloud partner, powered by AMC’s Flexible Shopping Insights paid data segment, which helped the company get more efficient with sponsored ads. It also helped them shift Amazon Ads budget towards upper-funnel CTV buys on Amazon DSP with the benefit of path-to-conversion measurement from AMC. 

• Streamlined budget management. The unified approach to handling brand and ecommerce budgets under a single strategic umbrella. This centralization improves resource allocation, reducing inefficiencies and enhancing the overall impact of the marketing spend.
• Agile response to market dynamics. By leveraging time-saving platforms like Skai, the company can adjust its advertising strategies in real-time and rely on automation for menial tasks. 
• Enhanced cross-departmental collaboration. By breaking down traditional silos between the brand marketing and ecommerce teams, the manufacturer fosters a more collaborative environment. 

Through these strategic initiatives, the audio equipment manufacturer keeps pace with the fast-moving electronics market and produces sustained growth despite significant market competitiveness.

Global confectioner’s advanced incrementality testing approach

For a global confectioner, accurately measuring marketing effectiveness presents unique challenges due to the seasonal nature of products and diverse regional preferences. In collaboration with a leading marketing agency, this company has embarked on an ambitious project to refine its incrementality testing methods. 

They initiated an alpha phase project with Skai, incorporating a product-holdout-based incrementality testing model. To ensure the test produced findings with a high confidence level to meet rigorous scientific standards, they used a combination of data sources, including AMC and Selling-Partner API, and collaborated closely with the brand marketing teams to identify optimal test and control groups. 

To minimize contamination in the test, they had all parties oversee the campaign execution. However, this approach proved more complex than anticipated, necessitating modifications and re-evaluations of datasets and timing for executing the model with Sponsored Ads. The brand and agency have concurrently been seeking out “always on” incrementality measurements like iROAS while they find the right window to continue data-science-backed incrementality testing.

• Innovative testing models. By employing product-holdout testing, the confectioner can gain confidence about the causal relationship of certain retail media investments and use those insights to determine what works and what doesn’t across other brands and markets.
• Multiple approaches to problem-solving. Using diverse methodologies, including AMC and other third-party tools, to generate incrementality measurements allows the company to assess the impact of its retail media investments.
• Partnership and collaboration. Collaborating closely with technology partners and agencies enhances the sophistication of their testing methods and ensures that the incrementality strategies remain robust and highly relevant to current market conditions.

Through these strategic initiatives, the global confectioner addresses the unique challenges of its market segment and establishes a benchmark for how large, multi-market entities can effectively measure and optimize marketing impact.

Mobile accessory brand’s incrementality imperative

As a pioneer in the mobile accessory category, this brand faces intense competition from lower-priced knockoffs aiming to undercut its market position and a rapidly evolving device ecosystem. For the marketing team, addressing incrementality became imperative as they realized that budgets could no longer grow faster than sales. Rather than bringing on an MMM partner to outsource the job of understanding the relationship between channels, the company decided to focus on its most important sales channel, Amazon. 

But to avoid creating further silos internally, they also decided to reorganize the company structure to unify all ecommerce management into a single team, including sales, marketing, retail, and D2C. Furthermore, the company decided to move away from fully in-house Amazon channel management by hiring a full-service retail agency with a track record of success helping brands on Amazon. The brand has since overhauled its KPIs and accelerated the adoption of AI-powered optimization in Skai. 

• Strategic realignment. The company has shifted its organizational structure to better support its key sales channel.
• Agency collaboration. They sought additional expertise, and after a careful selection process, they found a team that resonated with them and had the track record to replicate success in their challenges. 
• Increased usage of AI-powered optimization. The brand and agency worked closely with Skai to implement features that would unlock further efficiency without increasing spending.

This approach helps the mobile accessory brand defend its established market territory, shift consumer buying behavior to more defensible products in the assortment, and regain a healthy balance between retail media investment and overall sales growth.

Nutritional supplement company’s strategic growth through analytics

Identifying real incremental gains amidst normal market variations in the supplement market is particularly challenging, mainly when a significant portion of the marketing budget is focused on a single online platform like Amazon. This nutritional supplement company addresses these challenges using detailed analytics to optimize its advertising spend and explore new growth opportunities. Their strategic focus includes advanced analytical tools to enhance the precision of their campaigns and reallocate funds effectively from traditional channels to digital platforms.

The company uses an advanced “digital shelf” analytics platform to measure market share and get laser-focused on how to gain share. It also started subscribing to and analyzing AMC’s Flexible Shopping Insights datasets to gain deeper insights into the customer journey and better understand the relationship between paid and organic on Amazon. The marketing team is in-housing media channels and evaluating the most cost-effective way to reach its audiences. These efforts are part of a broader initiative to refine their approach to incrementality. They’ve identified branded searches as an important KPI to add alongside market share in order to keep growing share while counteracting diminishing returns.

• Leveraging detailed analytics. The company uses advanced analytics to pinpoint where its marketing efforts are most successful and make data-driven decisions to improve market share.
• Balancing spending. Maintains solid investment levels for brand awareness and conversion-focused campaigns, with Amazon being the largest conversion-focused budget and TV being the largest awareness-focused budget. 
• Strategic experimentation. Continual testing across various advertising formats and channels ensures that the company remains agile and responsive to market changes. This proactive approach helps capitalize on emerging opportunities, keeping the company competitive in a fast-evolving market.

By focusing on data-driven strategies and market share-focused measurement, this supplement company effectively navigates the market’s complexities, driving growth and maintaining a competitive edge.

Skai’s methodology-agnostic approach to retail media incrementality

Skai’s platform offers a flexible, integrated approach to retail media incrementality that adapts to any measurement strategy, empowering marketers to optimize their campaigns efficiently across multiple channels. 

Here’s how Skai supports this multifaceted approach:

1. Partner agnostic. Skai’s versatile platform supports virtually every incrementality methodology, including proprietary metrics generated by partners. This flexibility allows marketers to implement the strategies that best meet their specific needs.
2. Seamless activation. New data sources are emerging to formulate incrementality approaches. Skai’s robust infrastructure makes it faster and easier to go from insights to action, significantly enhancing the agility and effectiveness of marketing campaigns.
3. Omnichannel capabilities. Retail media campaigns are impacted by many other factors, including other departments in the organization. By empowering retail media managers with a platform that works across search, social, and retail media, Skai helps break down silos and provide economies of scale as users take on more media management responsibilities.

Key takeaway: there’s no one-size-fits-all approach to incrementality

Mastering incrementality in retail media is complex and requires a customized approach. The six companies we reviewed have shown innovation and adaptability in their strategies, each tailored to their specific market conditions and business goals. This variety highlights the need for a flexible approach to incrementality measurement, which is essential for effectively navigating the complexities of retail media.

Skai can be incredibly beneficial for your brand or agency in this area. Our methodology-agnostic platform enables you to select and implement the most appropriate incrementality strategies for your needs, offering versatility beyond a single approach. The platform streamlines the process from insight to action, boosting the agility and effectiveness of marketing campaigns.

Please schedule a brief demo with our team to learn more about our incrementality solution and see our omnichannel platform in action.