3 ways data clean rooms help solve retail media’s data and measurement challenges

Nearly two-thirds (66%) of US data and ad professionals have adopted data clean rooms as a result of privacy legislation and/or signal loss, according to February 2024 data from the Interactive Advertising Bureau (IAB) and BWG Strategy. Since data is at the core of retail media success, enabling brands to target and measure campaigns more accurately, it’s not surprising that data clean rooms have come into play.

Here are three ways agencies and retail media networks are using data clean rooms to help brands more effectively target and measure their campaigns.

1. Matching purchase data with behavioral data

With data clean rooms, retailers, brands, and media partners can combine data to create a more robust, privacy-safe view of the customer.

“You can get beyond simple purchase data and start to target based on a series of actions,” Riyaad Edoo, executive director of commerce at EssenceMediacom, said during a recent IAB roundtable discussion. “That gets to the psychology of the consumer, their behavioral patterns or passion points, the characteristics and their triggers.”

Machine learning helps brands take it one step further.

“You can uncover all sorts of interdependencies that we never would have found [without the help of that technology],” said Edoo. “ What does churn look like? What are the optimal touch points or sequencing of touch points look like? What is the cost per acquisition relative to each one of those?”

2. Connecting online ads to in-store sales

CVS Media Exchange (CMX) offers ad inventory across its website, mobile app, and off-site channels. However, the majority of CVS purchases happen in-store, according to Praveen Menon, head of analytics and business intelligence at CMX.

• Historically, it’s been challenging for brands to connect online and in-store behavior. But data clean rooms, like the one CVS partnered on with Pinterest, can help.
• “We can cross reference our CVS Extra Care member purchasing habits with Pinterest’s data, which allows us to kind of report back performance with a high degree of accuracy to our supplier partners,” said Menon.

3. Informing future retail media investments

Data clean rooms enable brands to identify where their investments are most effective.

“One of our biggest wins with data clean rooms is when we use it as a baseline to inform channel investment,” said Kavita Cariapa, senior vice president, head of commerce activation at Dentsu. “There’s always a question on how and where to invest, especially as retail media networks are expanding their inventories.”

With clean rooms, Dentsu can advise its clients where there are incrementality opportunities or where they should prioritize their share on the shelf.

“It’s become a robust guideline for how we analyze data and consult with our clients to make sure their investments are profitable and that they’re not wasting impressions,” said Cariapa.

This was originally featured in the Retail Media Weekly newsletter. For more marketing insights, statistics, and trends, subscribe here.