How Radio Can Help Supermarkets Compete With Amazon Go

There's an increase in brands using it industrywide to reach consumers

Supermarkets are seeing success with using radio ads to target consumers. - Credit by Getty Images
Headshot of Paul Brenner

Amazon Go has completely overhauled the in-store shopping experience by eliminating its biggest flaw: the loathed and often lengthy check-out process.

Since debuting its cashier-less Seattle location at the end of 2017, Amazon already has plans to open stores in Chicago and San Francisco. Do supermarkets stand a chance against Amazon’s growing grocery empire, complete with Prime, Go and, let’s not forget, its acquisition of Whole Foods?

Reports say Microsoft is developing similar technology to sell to retailers struggling to compete. Time will tell if the automated checkout model will succeed and disrupt the retail industry as we know it.

But whether grocery stores leap or lag to adopt the technology, a challenge unique to in-store commerce will persist: increasing foot traffic. No matter how smart our stores get, brands will need to advertise to make sure consumers know they exist.

That’s why radio—yes, radio—should be a key channel in the marketing mix as supermarkets fight to survive.

Trust and ROI in radio

Digital advertising used to be marketing’s sweetheart for its robust targeting capabilities, but the proliferation of programmatic ad buys is not without controversy. Reuters reports that 75 percent of executives claim they have seen ads placed next to “unsavory or objectionable stories or videos,” and 77 percent believe that when ads appear next to that content it damages the brand.

No matter how smart our stores get, brands will need to advertise to make sure consumers know they exist.

Meanwhile, retailers like grocery stores are finding success in a back-to-basics marketing mix using radio ads to draw in customers and increase foot traffic.

Radio has long been known as a powerful medium to reach a wide swath of consumers, and its omnipresence, from Uber rides to showerheads, makes it an attractive channel to advertise. But when going up against the sea of analytics available through digital advertising, advertisers found it difficult to justify radio spend because of the lack of attribution. That’s no longer the case.

Now radio is smart and mobile. More consumers are using mobile apps to tune in via smart devices, and more advertisers are realizing the channel’s new benefits. Brands can (and should) quantify and attribute audience behaviors, like foot traffic, to specific radio advertising efforts.

Needless to say, agencies and brands are increasingly weaving it back into their strategies. With access to such attribution, brand advertisers should take those learnings back to the stage of ideation and creation because they now know what content resonates and where, which were most successful and what generated the strongest ROI. 

Knowing your (radio) audience

Before attribution hit radio, brands and agencies relied on estimates about audience analytics. But the old adage for smart marketing isn’t “guess your audience.”

With increased access to data across advertising channels, we can better understand who consumers are and where they are. Radio ads reach 54 percent of the U.S. population, compared to nearly 46 percent via social media. But who do they reach?

Your customer through radio is likely not the same customer you reach through social media or TV ads. The biggest mistake you can make is advertising to different audiences like they are the same. Consumers are constantly bombarded by ads online and on the airwaves, so advertisers must use data to cater their content to reach the right people to see ROI.

And if you discover an overlap between your target audience on radio and social, how can you best harmonize campaign creative across platforms? For instance, is your morning commuter headed to a desk job where they will see your digital ad and perhaps needs to grocery shop after work? When you can map out a consumer’s day, you can then take advertising creative a step further to show them you understand what they want to buy. Think of advertising as providing answers to consumers’ problems.

Thinking local

Advertisers fighting to cut through the clutter in the grocery space should also keep in mind the rising consumer demand for local and regional products. People want to know where their food is coming from. Local food sales in the U.S. grew from $5 billion to $12 billion between 2008 and 2014, and the same research predicted sales to climb to $20 billion by 2019.

This stems back to using data to understand your audience: Where are they, and are they “locavores”? If yes, smart marketers should seize the opportunity to synergize radio’s local and regional targeting functions with consumers’ local-first purchasing behaviors.

It’s not enough to only understand the who in the equation. When you go after a new target market, the when and the where are incredibly important to keep in mind. Radio listeners and shoppers both typically have routines for when/where they tune in and when/where they buy groceries. It is crucial to yield insights from data to tap the local mindset at the right time, place and frequency. Even the best campaigns suffer from ad wear out, so be conscious.

As more retailers play catch up to Amazon Go, having access to the right data is the key to staying competitive. Digital advertising will remain an important part of the mix, but smart marketers should recognize that a winning strategy will include radio.

Paul Brenner is president of Dial Report.