How a health and wellness brand justifies additional retail media investment

With retail media growth and increased adoption, one brand leveraged Incremental to understand how they could make the case internally to participate in a new retail media network (RMN) - even with constraints.

The context:

A health and wellness brand had begun investing in a new retail media network with a limited budget. The ROAS looked promising, but they believed they were under-invested in the channel and would see even greater efficiency and sales growth by doubling their current budget.

The challenge:

Historically, the brand used ad-attributed sales and ROAS to provide estimates on how ad budget increases would impact sales. Unfortunately, this was rarely proved in practice. Often when they increased their investment, they didn’t see an equal uplift in ad-attributed sales and their ROAS declined significantly. This created internal friction in the organization with their finance team who was becoming skeptical that increasing the budget for the new retail media network would yield incremental sales for that channel. The ecommerce team needed forward-looking incremental sales projections based on spend and an estimated return on just those incremental sales (iROI).

The results:

Incremental’s platform controlled for external factors like seasonality, promotion, and spend on other channels to isolate just the incremental sales generated by investing in that retail media network. The team used Incremental’s Scenario Planning capability to simulate a 200% increase in their investment and the model’s results indicated that they were in fact below the point of diminishing returns and could increase investment without seeing a decline in efficiency. They used this to justify a 200% increase in the budget and saw these results:

200% Increase in RMN channel budget

238% Increase in RMN channel incremental Sales

19% Increase in RMN iROI

The faster growth rate of incremental sales relative to their budget increase confirmed their hypotheses - they were under-invested in the channel. This allowed them to build confidence across the organization during future goal and budget-setting exercises.

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