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CVS Media Exchange bets on solving the measurement gap to stand out in the retail media landscape

May 4, 2024
in Technology
CVS Media Exchange bets on solving the measurement gap to stand out in the retail media landscape
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Retailers are either beefing up their retail media networks or launching their own, as the retail media arms race continues to heat up and Google moves very slowly toward its third-party cookie apocalypse — giving retailers the opportunity to hock their first-party data in an attempt to fill Google’s cookie-sized hole. CVS is one such retailer.

However, measurement and attribution are common pain points for advertisers looking to track campaign performance in retail media. They’re pain points that CVS Media Exchange, CVS’s retail media arm, which is also known as CMX, is aiming to solve to help it stand out in an increasingly crowded landscape. 

“P​​roviding a level of transparency around measurement and the way in which we are delivering that back to our advertisers — so we create a transparent playing field for our retail media networks — that’s what’s going to continue to help grow the industry,” said Parbinder Dhariwal, vp and general manager at CVS Media Exchange.

CMX only launched in 2020, but CVS’s massive retail footprint including 9,000 store locations and its ExtraCare Membership loyalty program has made the RMN a worthwhile contender in the retail media network space, especially as it aims to solve the measurement and attribution problem. 

On Monday, CMX announced improvements to its measurement capabilities that align with the Interactive Advertising Bureau/Media Rating Council retail media measurement standards. CMX has upgraded its client performance dashboard to show sales attribution based on IAB-standard viewable impressions and it can now measure conversions more effectively.

CVS has been building momentum around its measurement and attribution capabilities in the RMN space as Google’s third-party cookie continues to be phased out of the tech giant’s Chrome browser. Back in February, CMX adopted the LiveRamp data clean room offering rolled out by Pinterest, offering advertisers the opportunity to track product sales stemming from Pinterest ads. According to Dhariwal, CMX has plans to announce similar partnerships within the social space. He did not disclose further details.

CMX’s current measurement capabilities are available both through on-site and off-site channels, something advertisers have expressed interest in as the retail media space matures.

“Their off-site media, they partnered with Trade Desk, which means they have the same targeting you get with any other major retail media platform out there for off-site,” said Tim Hemingway, svp of commerce at Havas Media. “On-site is incredible because CVS is able to use their shopper rewards data to create their targets on-site.”

Measurement has been a hot topic in the retail media space, especially since the IAB/MRC released Retail Media Measurement Guidelines last September, and finalized those guidelines this January. It makes sense that CMX is looking to align itself with the guidelines, said Jennifer Kohl, chief media officer at ad agency VML.

“In order for them to be competitive it is in their best interest to follow the same standards that other RMNs are following,” she said. “It will allow them to play in the same sandbox with their competitors and be considered for the big deals.”

Moving to off-site platforms like streaming services is the next step as retail media matures and more retailers invest in retail media offerings. (You can take a full look at the current retail media landscape line-up here.) Beyond its push for measurement transparency and standardization, CMX is betting on its off-site capabilities to stand out from the competition, per Dhariwal.

“When a consumer is browsing for products, watching Hulu, whether or not they’re browsing some of our premium publisher partners such as The New York Times or our premium audio partners such as Spotify and Pandora, we’re targeting messages to them through our [demand-side platform] relationships,” he said.

The million dollar question — or holy grail, as Dhariwal puts it — is whether CMX can marry shoppers’ on-site and off-site experiences to offer advertisers a more holistic view of consumers. Thus far, CMX hasn’t achieved this — but neither has the industry at large. But CVS’s ExtraCare loyalty program is a big advantage because it gives CMX an extensive shopper network and advertisers heaps of consumer insights. 

In addition to CVS’s 9,000 brick-and-mortar stores, e-commerce website and off-site partnerships, CMX is one of the more balanced retail offerings, said Kohl.

“It does start to feel like they’ve got that surround sound on the consumer,” she said. “They have probably one of the better balances of footprint, in-store and then the digital piece, the dot-com aspect of it.”

Like home improvement retailer Home Depot, CVS has a bit of a specialized audience, given it sells itself as a one-stop-shop for health and wellness. Retailers like Amazon and Walmart have historically scooped up the bulk of retail media ad dollars, making for stiff competition (although those tides are starting to turn). Instead of pitting itself against the retail behemoths, CVS seems to have taken the approach of being everything to some advertisers as opposed to being something to every advertiser. As more retailers jump into the retail media network space, there are a lot of benefits to going after a specialty audience, per Hemingway. 

“I do think that there is a lot of power in that messaging, especially for advertisers, for marketers looking at it as you’re trying to reach specific audiences,” he said.

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