In today’s competitive landscape, it’s more important than ever for brands to have a clear understanding of how marketing campaigns are performing. Are they driving incremental sales? Are they reaching new customers? These are the questions facing brands as they decide where to allocate marketing dollars.
One metric that can provide insight into these questions is “new to brand,” which measures how many new customers a retailer acquires through campaign activity. This metric is exclusive to retail media and can be a powerful tool in determining the effectiveness of a campaign.
Let’s look closely at why “new to brand” is such a vital campaign reporting metric.
Connecting Media Spend to Retail Sales
“New to brand” refers to the number of new customers a brand acquires through its retail media campaigns. A campaign report must surface insight into “what worked” — did the media expenditure lead to incremental revenue that would not otherwise have occurred?
That may sound like a job for a statistical model, but any analyst can attest to the importance of simple metrics that support model findings to confirm they’re on the right path. Moreover, these figures are easier to observe, prove and recall, making stakeholder discussions easier throughout your business. “New to brand” provides strong support for incremental revenue. It’s an easy way to validate that media expenditure is working.
Brands that don’t sell directly to consumers rely on retail partners to understand the real number of distinct customers using their products. Additionally, a brand communicating with customers using search and social media channels will see measures of reach and response but will miss out on how that spending led to sales conversions. Retail media combines these operations to connect the view of spend to sales.
The exclusivity of the “new to brand” metric to retail media comes from the unique data insights that retailers can access. These insights are only available through some marketing channels, as retailers have a direct connection to sales data, allowing them to track customer behavior from the display of an advertisement to the point of purchase. This level of granularity allows for the accurate identification of new customers.
Furthermore, retail media platforms can leverage their extensive customer databases to differentiate between existing and new customers. For example, they can track shopper purchase history and identify if someone has previously bought a specific brand or product. This insight allows retail media to attribute the acquisition of new customers directly to the marketing campaign, making the “new to brand” metric exclusive to retail media.
Why ‘New to Brand’ Matters for Media Buyers
There are a few reasons why “new to brand” is such an important metric for retail media buyers. First, it provides insights into whether or not marketing efforts are driving incremental sales. The metric is becoming a must-have for retail media campaign reporting.
For planning, the “new to brand” metric is crucial in delineating marketing strategies. By understanding which campaigns bring in more new customers, brands can optimize their marketing efforts to focus on acquisition and retention tactics separately. This allows for more efficient allocation of marketing budgets and improved ROI.
Why ‘New to Brand’ Matters for Retailers
As retailers feel margin pressure, it is more important than ever for them to clearly understand how their retail media networks generate a flywheel of growth. One way they can do this is by tracking the “new-to-brand” rate, which measures how many new customers are acquired through retail media campaigns. This metric provides valuable insights into whether or not a campaign is effectively reaching its target audience and driving incremental sales. Thus, it should be used as one of several key metrics when evaluating the performance of retail marketing campaigns.
An additional benefit of the “new to brand” metric is its ability to help retailers build a comprehensive customer profile. By analyzing the demographics and purchasing behaviors of newly acquired customers, retailers can gain insights into the factors that drive new customers to their brand. This information can be used to refine marketing strategies and tailor future campaigns to target specific customer segments more effectively.
For instance, a retailer might notice that the majority of new customers acquired through a particular campaign are young professionals with a preference for eco-friendly products. Armed with this information, the retailer can create targeted marketing messages that emphasize the brand’s commitment to sustainability, ultimately attracting more like-minded customers.
The “new to brand” metric not only helps retailers understand the effectiveness of their marketing campaigns but also contributes to maximizing the lifetime value of new customers. By identifying which campaigns bring in the most valuable customers, retailers can invest more in those strategies to attract and retain high-value customers over time.
To maximize lifetime customer value, retailers can use the “new to brand” metric alongside other key performance indicators (KPIs), such as average transaction value and purchase frequency. By combining these metrics, retailers can clearly understand the long-term value of new customers acquired through various campaigns and optimize their marketing strategies accordingly.
The “new to brand” metric is a powerful tool that provides retailers with invaluable insights into the effectiveness of their marketing campaigns, customer profiles, lifetime customer value and multi-channel marketing strategies. By incorporating this metric into their overall marketing analysis, retailers can make data-driven decisions to optimize their campaigns, attract new customers and drive long-term growth.
Hugh Cameron is Head of Data at Zitcha, an all-channel retail and commerce media technology platform that takes a retailer-first approach, creating walled gardens to drive amazing enterprise value.