Retail Media Is An Afterthought For Most CPG Brands. That’s Why Good Peeps Exists.

Online retailers this holiday season are trying to monetize in new ways, but the companies behind the products they sell need to pull their weight too. Many of them are still figuring out exactly how to do that.

It’s the game of retail media, the emerging sector in the CPG industry which didn’t exist a number of years ago, and is evolving by the week. Most teams operating grocery brands don’t have the bandwidth to learn the intricacies of how each retail site’s ad platforms function.

“If you have the ambition of being a large household brand and you’re selling in these retailers but not advertising on their dot-com equivalents or Instacart, you’re leaving money on the table,” Kiva Dickinson, founder and managing partner at Selva Ventures, tells me.

“Retail media democratizes the shelf,” says Shray Joshi, founder and CEO of Good Peeps, a leading retail media agency. “In the store, it’s hard to push old school brands from having many placements. But online, our brands become number one or two versus number 75 in the category.”

A New Age Of Digital Marketing

Retailers base vendor performance comprehensively, both in-person and online. Retail doesn’t just mean brick-and-mortar retail any longer; it also includes ecommerce–retail media.

“Brands now get anywhere from 15 to 35% of revenue from these retailer dot-coms,” Joshi says. “We’re unlocking a huge chunk of velocity that they weren’t getting before.”

Retail media consists of a retailer’s online or app-based marketplaces, for example, Walmart.com, Target.com or Kroger.com. Third-party sites where consumers can purchase groceries, including DoorDash, Instacart, Thrive Market and GoPuff are the emerging sector of the retail media businesses. “Most brands don’t have these channels on,” Joshi says. Ad platforms on each of these function differently. Brands need to understand each of their algorithms intimately in order to drive sales and gain customers. That’s where retail media marketers come in.

It’s not just about appearing on those platforms, but the way your brand appears. Agencies like Good Peeps implement marketing tactics such as amplifying content and implementing creative titles, descriptions and images–meeting customers, new and existing, in every moment and capturing their attention during the digital shopping experience to encourage them to add to cart and click ‘purchase.’

Amazon has its own unique fulfillment model, so is typically not part of the retail media conversation, nor is direct-to-consumer. You’ll have to commit to buying an entire case of beverages instead of the possibility of trying out a can–naturally, Amazon is generally for customers who already know what they want with less buying frequency.

But that’s not to say other retailers aren’t trying to become the new Amazon. Walmart has reported 14 straight quarters of more than 10% ecommerce growth, and Target is reporting stronger online sales than in-store.

Many brands feel burned by selling direct-to-consumer because of high shipping costs, souring their sentiments toward online sales overall. But investing in retail media is different. “Most of these brands do not even know that this is a sizable opportunity because these platforms have traditionally been 2 or 3% of revenue for these brands. Only in the last year or two have we seen a massive skyrocket,” Joshi says. “This is the biggest shift in CPG brand spending in 10 years,” Joshi says. “We’re at the forefront of that.”

It can change the way a brand presents itself behind the scenes too. “The same advertising for d2c, Amazon and in-store needs to be present in these sources,” Dickinson says. “That’s important to me as an investor.”

A New Type Of Marketing Agency

Los Angeles-based Good Peeps stems from Joshi’s personal relationship with food. “My parents came from India and their love language was food,” he says, “so I grew up overweight.” It sparked his path to help change Americans’ relationships with food, earning a Nutritional Biochemistry degree from UMass Boston, all while losing 150 pounds.

Working in marketing roles at brands like Health-Ade kombucha, Nomadica wines and Wilde chips, Joshi initially began figuring out ways to improve paid advertisements across the digital landscape, but that very landscape was changing at a pace marketers themselves had trouble keeping up with. That’s when he decided to commit to becoming the ultimate retail media marketer, a niche subcategory that would soon become one of the most overlooked revenue streams.

Fly by Jing, the Chinese chili crisp company, became Good Peeps’ first client. Hundreds of companies have since reached out to the agency to become a client, but Joshi and his dozen employees only take on about one new client a month in order to keep its intimate feel. “Brands we take on are ones that I feel in a few years will be billion dollar businesses,” Joshi says. That includes Oats Overnight and its newest client, Bobbie organic baby formula.

“There is a big misunderstanding of all of the nuances,” Brian Tate, founder and CEO of Oats Overnight, tells me. “A lot of dollars go into this. This is direct spending in search results. The difference in return on those dollars is massive.”

“The majority of retail agencies feel like they’re in a clunky retailer ecosystem,” Sara Holman, Chief Commercial Officer of Bobbie, tells me. “Good Peeps feels very digitally native, immersed, and measures outcomes like a performance marketing team as opposed to a retail team.”

Retailers are finding less and less meaning in the source of their sales. While they provide the platform, they are not providing specific marketing tools–that’s on the brands themselves. “The majority of shoppers are omnichannel shoppers now,” says Holman. “Retailers are getting more sophisticated, building their own algorithms. Brands have to get more sophisticated with them.”

Good Peeps dives deeper than simple SEO search terms that anyone could optimize from Google Trends. “We have improved how we structure campaigns, how much we spend on incremental vs branded higher intent search,” Tate explains. “We are now one of the fastest-growing brands on Instacart this year.”

“For an omnichannel company, the more housed under one roof, the better,” Dickinson adds. “Years from now, there will be more agencies doing this and it will be a much larger part of the industry than it is today.”

Good Peeps has become a Preferred Partner to Instacart, Walmart and Target, providing its clients with an added layer of data that they can’t necessarily access simply from their respective ads platforms. “Shray finds opportunities in the market and pushes them,” Tate says. “The landscape is always changing. Shray is plugged in and he is on it fast.”

A New Aisle For Discovery

Once a retailer brings a product into its ecosystem, brands can capitalize beyond basic sales. “Retail media is by far the most efficient form of customer acquisition,” Joshi says. “The online shopper tends to have the highest repurchase rates and the highest disposable income of any shopper.”

It boosts brand recognition by becoming visible in front of potential customers. “Where brands can really win is enabling product discovery,” Michael Peroutka, Gopuff’s Head of Ads, tells me. “We create the aisles.”

Peroutka heads retail media marketing strategy for Gopuff, the vertically-integrated instant commerce retailer known for delivering everyday essentials at any hour of the day. “Our ads platform allows brands to bid not only on search terms, but also audiences,” he explains. “The digital environment allows for a deeper level of targeting for a brand that you can’t find in other places.”

Tate says Good Peeps unlocked this system of bidding, which is an extremely rare bucket of knowledge to understand today. “Before, we were managing this ourselves and made some big mistakes like bidding against ourselves.”

Good Peeps’ ability to democratize the digital shelf creates a better shopping experience for customers too, and the more customers enjoy the experience, the more that these retailers will prioritize retail media. “In brick-and-mortar, you see all the products. In digital, you only see a handful out of the hundreds that we have,” Peroutka says. “Nobody scrolls through all of those. The best solutions are at the front of the shelf. We enable brands to bid on that top spot.”

The impact of good retail media is practically endless.

“If someone adds tortilla chips to their basket, you want to do anything you can to get salsa in front of them. That’s a solution built out on Gopuff now,” Peroutka says.

“On a shelf you don’t see reviews. People go to the retailers app even while they’re walking in the physical store. To grow a brand, it’s not enough to be just in the store,” Holman adds.

And the impact of a great retail media innovator has the ability to change the future of how an entire industry operates.

“Shray has the background of a marketer and the relationships of a retail broker, and that’s rare,” Tate says. “This is not building a house. It’s flying a plane, and you need a good pilot.”