BRAVE COMMERCE Episode Summary: "Wella & Reckitt Unpack the Future of Retail vs. National Media"

Release Date: February 11, 2025

In this compelling episode of Brave Commerce, hosted by Rachel Tippograph, Founder and CEO of MikMak, and Sarah Hofstetter, President of Profitero, industry leaders Farah Linden from Wella and Josh Jresky from Reckitt engage in an insightful discussion about the evolving landscape of retail media versus national digital media. The conversation delves into the complexities of media investment, budget allocation, profitability, creative strategies, platform maturity, and organizational structures within major brands navigating the blurred lines between these two media channels.

1. Introduction to the Debate

Rachel Tippograph opens the discussion by highlighting the frequent intersection of retail media and national digital media in their conversations—citing that they've addressed the topic in approximately 50 out of 200 episodes. She sets the stage for the episode by introducing the challenges brands face as these channels and their associated budgets increasingly blur. The goal: to glean insights from Farah and Josh, both adept at navigating this intricate media environment.

Rachel Tippograph [02:07]: "Retail media and national digital media are channels that are starting to blur, the budgets are starting to blur and so operationally internally how you operate is probably blurring as well."

2. Defining Retail Media vs. National Media

Farah Linden and Josh Jresky delve into the nuanced definitions of retail and national media within their organizations. Farah explains that Wella categorizes media into brand media, national media, and retail media, acknowledging the blurred lines between them.

Farah Linden [03:35]: "We consider brand media, national media, and retail media."

Josh echoes this sentiment, discussing the internal debates over terminology and the practical challenges of distinguishing between retail and consumer media.

Josh Jresky [04:28]: "We've had this debate internally. So I start calling it consumer, brand national media... there's confusion still even between retail media and consumer."

3. Budget Allocation and Management

The conversation shifts to strategic budget management amidst the ambiguity of media channels. Farah emphasizes aligning media investments with specific sales and consumption goals, ensuring that each channel contributes effectively to overarching business objectives.

Farah Linden [05:41]: "It all should ladder up to your goals and your specific sales goals per channel or consumption goals."

Josh adds that defining clear objectives—whether acquisition, competitive conquest, or consumer switchers—is crucial for effective budget allocation.

Josh Jresky [06:05]: "It's really defining the goal and objective... understanding the business objective that leads into the marketing objective, that leads into the comms objective, that finally leads into the media objective."

4. Profitability of Retail Media

Addressing skepticism around the profitability of retail media, Farah shares Wella's positive outlook, citing high profitability driven by first-party data and closed-loop attribution.

Farah Linden [08:56]: "I think it has one of the highest profitability out of all channels we see the greatest return because of the first party data and the closed loop attribution."

Conversely, Josh discusses Reckitt's evolving measurement frameworks, moving beyond traditional metrics like CTR and ROAS to more meaningful indicators such as incrementality and brand lift studies.

Josh Jresky [09:06]: "ROAS to me is the new CTR... shifting the conversation from being over focused on ROAS to doing things like driving incrementality. Sales lift and even equity based measurements like brand lift studies are new areas of opportunity."

5. Measurement and Key Performance Indicators (KPIs)

Both leaders agree on the necessity of granular KPIs. Farah highlights the ability to measure metrics like new-to-brand customers and lifetime value, leveraging detailed consumer insights to enhance media effectiveness.

Farah Linden [09:43]: "We can measure new to brand, we can measure lifetime value. It's just we get so much more information on our consumer that we find valuable."

Josh emphasizes transforming measurement frameworks to align with strategic objectives, advocating for metrics that reflect long-term value rather than short-term clicks.

6. Creative Excellence in Retail Media

The discussion pivots to the importance of creative strategies in retail media. Josh critiques the reliance on static images and low-impact ad formats, advocating for dynamic, high-impact content tailored to the predominantly mobile consumption landscape.

Josh Jresky [11:41]: "We're focusing on video content, on high impact content... How are we going to do that with a static image and a 300 by 250 banner?"

He underscores the challenge of scaling creative excellence across various platforms, balancing on-site and off-site channels to maximize incrementality.

7. Platform Maturity and Future Investments

Farah and Josh identify Amazon and Walmart as mature players in the retail media ecosystem, noting their significant investments and strategic acquisitions that bolster their media capabilities.

Farah Linden [14:21]: "Amazon is just growing exponentially."

Josh discusses Reckitt's approach to evaluating platform maturity through a scorecard system, assessing whether platforms own their technology or rely on third-party solutions, and their capacity for self-service versus managed services.

Josh Jresky [13:54]: "We're looking at do they own their own technology or are they using a licensed third party as a key indication."

8. Organizational Structure and Integration of Media Functions

The episode explores how brand media and retail media are positioned within organizations. Farah and Josh describe their roles as centers of excellence (COE) that collaborate across teams and brands, ensuring cohesive media strategies.

Farah Linden [15:38]: "I sit in marketing. I report to the CMO... we're also a COE... we work with every single team and we work across every single brand."

Josh discusses the potential future of trade marketing as a hybrid function that bridges brand marketing and sales, suggesting it may evolve into a more centralized role within marketing teams.

Josh Jresky [16:28]: "I think it's going to be interesting to see what happens with trade marketing... how much that grows, especially with all the conversations that we're having today."

9. Future Capabilities and Skills for Success

Looking ahead, both leaders emphasize the importance of evolving skill sets. Farah highlights the growing influence of user-generated content (UGC) and the necessity of understanding platform algorithms.

Farah Linden [18:15]: "The best content is UGC. So I think just really understanding that space is super important in paid media right now."

Josh adds that the fusion of technology and strategy requires professionals to possess both technical proficiency and strategic acumen, advocating for "unicorn" talents who can navigate both realms seamlessly.

Josh Jresky [18:45]: "If you do not understand the platforms you are activating on, you cannot speak to strategy and then you cannot understand the data and analytics that are coming through."

10. Unified vs. Separate Brand and Retail Media Functions

Rachel poses a critical question about the organizational benefits and drawbacks of having brand media and retail media as distinct functions versus integrated within a single discipline.

Farah contemplates the advantages of separation, such as maintaining specialized focus and optimizing budgets closely aligned with specific media channels.

Farah Linden [19:55]: "The benefits of having them separated is that you keep retail performance marketing and you're very close to the sales side and you're able to optimize that budget."

Conversely, Josh warns against the potential loss of consistent brand messaging when media functions operate in silos, leading to mixed communications that can confuse consumers.

Josh Jresky [20:16]: "The consumer is receiving mixed messaging and I don't think that's a recipe for success."

11. Personal Insights: The Bravest Things They’ve Done

In a light-hearted conclusion, Farah and Josh share personal anecdotes about their bravest actions, offering a glimpse into their personalities beyond their professional expertise.

Josh Jresky [20:45]: "Turning down my dream job... knowing that long term where I wanted to be was here."

Farah Linden [21:25]: "I did run a marathon and I had no running experience... I trained from start and I ran the New York City Marathon."

Conclusion

This episode of Brave Commerce provides a deep dive into the strategic intricacies of managing retail and national media within large organizations. Farah Linden and Josh Jresky offer valuable perspectives on aligning media investments with business objectives, fostering creative excellence, navigating platform maturity, and structuring organizational functions to optimize media performance. Their insights underscore the importance of adaptability, strategic clarity, and cohesive communication in the ever-evolving eCommerce landscape.

Listeners are encouraged to explore further discussions on related topics through previous episodes, such as Chris Chesbrough’s 2023 interview with Wella, providing a historical context to the current media strategies employed by leading brands.

Notable Quotes:

• Rachel Tippograph [02:07]: "Retail media and national digital media are channels that are starting to blur, the budgets are starting to blur and so operationally internally how you operate is probably blurring as well."

• Josh Jresky [06:05]: "It's really defining the goal and objective... understanding the business objective that leads into the marketing objective, that leads into the comms objective, that finally leads into the media objective."

• Farah Linden [08:56]: "I think it has one of the highest profitability out of all channels we see the greatest return because of the first party data and the closed loop attribution."

• Josh Jresky [09:06]: "ROAS to me is the new CTR... shifting the conversation from being over focused on ROAS to doing things like driving incrementality."

• Josh Jresky [11:41]: "We're focusing on video content, on high impact content... How are we going to do that with a static image and a 300 by 250 banner?"

• Farah Linden [18:15]: "The best content is UGC. So I think just really understanding that space is super important in paid media right now."

• Josh Jresky [18:45]: "If you do not understand the platforms you are activating on, you cannot speak to strategy and then you cannot understand the data and analytics that are coming through."