How Albertsons Media Collective Is Solving One of Retail Media’s Biggest Problems

With an agency background that spans some of the industry’s most highly regarded creative shops like Goodby Silverstein & Partners and Arnold, Kristi Argyilan describes creative problem-solving as a skill she learned early on.

Now, as senior vp of retail media at Albertsons Media Collective, Argyilan draws on her creative roots as well as her time in media agencies and stint at Target and Roundel to lead the grocer into a new era of commerce media. ADWEEK caught up with Argyilan to discuss how the national supermarket chain is differentiating as competition amongst retail media networks heats up.

This conversation has been edited for clarity and brevity.

ADWEEK: How is retail media driving revenue for Albertsons?

Kristi Argyilan: The retail media business is a growth lever for the company and one of the top strategic priorities. To continue to transform, you have to have profit-driven businesses that can fuel that transformation. How do we become a more digital retailer? How do we bring a different assortment mix? How do we support our team members, the way that we need to and that all comes from the more profit-rich lines of business that Albertsons has?

I’m hitting my three-year anniversary, and they have not wavered off of that, which has been important to ensure we have the resources we need to deliver back to our customers and our company. They’re not easy businesses to run because there are always conflicting priorities within a company, but we have a lot of tailwinds behind us and leadership team support to resolve wherever there might be a conflict in priorities because the intent is not to create conflict, but to come together as a team. [Albertsons doesn’t yet break out revenue numbers from retail media.]

We’ve heard a lot about the internal challenges that retailers face when building out a retail media business because the goals of the RMN can sometimes conflict with—and overlap with—the merchandising and sales teams. How is Albertsons navigating those organizational challenges?

The most important thing is education and bringing people along. If you work in the digital media and marketing space long enough—we have our lingo, we put our heads down, and we move at a really fast pace. It’s very different from where retail comes from. I see it as my responsibility to pause long enough to make sure that I’m explaining what we do and how it’s accretive to the company overall.

You have to rely on resources across the company, be ready for the amount of time and nuance, and have your teams focused on bringing internal partners along as much as they do external partners. It’s an area that we’re constantly watching and evolving on. There’s a co-ownership when it goes well. When it gets hard, you have to just acknowledge that and work through it as quickly as possible.

People often talk about retail media ‘collapsing the marketing funnel.’ And while that’s a buzzy statement, it poses measurement challenges. How is Albertsons approaching measurement and metrics to ensure that you have the right tools for advertisers?

Until we do better content, until we move up the brand chain and can publish really rich brand messages that then lead to commerce or an option to buy, we don’t have a right to say that we’ve collapsed the purchase funnel yet. We are still cracking how to do measurement, because we’re held to a ROAS measurement metric, which is so foundational and fundamental, but it’s the thing we have right now. But ROAS has nothing to do with the brand.

We’re working to integrate into marketing mix models, creating the API so we can plug directly into the platforms that they use. We’re just raising the bar in terms of how we’re being measured, and we know there’s a vulnerability in that, because what if we do that and we like, totally suck? But there’s a transparency to that I believe that retail media has to be held to because we’re a marketing asset, we’re not a tax. We have to be on a pathway where we’re willing to be held to the same standards as all of these other significant channels that are out there, and that will only come through how we allow ourselves to be measured.

We still need to get past channel by channel and look at incrementality as a media mix. It’s much better than ROAS, but how we measure retail media is still in the very early stages. We have to figure out how to get more into that competitive set—measuring RMNs against each other and social platforms—versus just how our channels perform against each other.

How is Albertsons working to differentiate itself in an increasingly crowded RMN landscape?

We know our customers not only on a national level but on a very local level, understanding the differences between shoppers of different regions. So there is a relevancy factor that we have that a lot of others don’t. We are more innovative in the way that we think about retail media. It’s more of a spine that we create for marketing overall, especially as cookies are coming out of the marketplace. We’re very early in understanding what is of greatest value to the marketplace that also serves our customers. I don’t know that it is about us buying inventory from Facebook and Pinterest and the open web—I don’t know if the industry needs us to do that as much as they need a great resource for audiences and measurement. That’s to be determined.

How is Albertsons investing in in-store ad placements?

It’s a massive media channel when you consider the number of customers that come through our doors and our opportunity to share product news with them, as well as non-endemic news. No reason why you can’t advertise a Disney vacation in the sunscreen aisle, but the complexity does sit in the wiring of the stores: The ad serving to different formatted channels. But how do you measure it? It is a great opportunity, but it is wildly complex, and the capital investment to eliminate the complexity is the thing that I think we’re all trying to figure out right now. And some people talk about that as retail 3.0, but I think it’ll be the retail expansion if and when we can figure it out. We have yet to find a singular solution other than what we built into our apps so that it’s carried around in our customers’ hands.