How Stop & Shop uses AI, not cookies, to target customers

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Could AI be the key to replacing cookies?

For more than two decades, brands such as Stop & Shop Grocery have relied on third-party "cookies", i.e. small text files saved through a web browser when the user browses a site. Web, to discern customer behavior and power their programmatic, or software-driven digital advertising.

But those days are almost over: thanks to Google's plans to phase out support for third-party cookies on Chrome in 2023, to Apple's limits on using its mobile device ID in apps iOS, as well as the need to comply with the GDPR. Soon, the $152 billion digital advertising industry in the United States will no longer have access to most third-party cookie data.

Retailers and brands aren't just waiting for the ax to fall. Instead, many are already testing a variety of possible ways to target the right customers once access to third-party cookies is terminated. These include AI-based solutions that learn from first-party and third-party data to spot patterns that shape customer profiles or segments.

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Stop & Shop, for example, a Massachusetts-based supermarket chain (and subsidiary of the Ahold holding) with 415 stores in the northeastern United States, has spent the past year and a half testing new approaches with the digital marketing company AMP Agency.

"We wanted to understand what would change in a post-third-party cookie world," said Samantha Weiss, vice president, data strategy and programmatic at AMP Agency. “How can we adapt benchmarks and grow and improve? »

Stop & Shop needed a new way to target its customers

According to Meghan Galligan, Digital Marketing Director of Stop & Shop, the company knew it needed to find other ways to target customers with relevant content while respecting privacy, as the company approached abandonment of cookies.

“We wanted to be the first to raise our hands and test as much as possible this year while we still had cookie security to rely on,” she said.

Most importantly, Stop & Shop has made sure its first-party data strategy is solid, she explained. Now they also compare new solutions against cookie-based segments, as well as against each other.

His team also prepared the leadership of Stop & Shop for the post-cookie landscape. "For two years we've been telling them that everything they used to see from us is about to change," she said. "We let them know that when 2023 rolls around, we'll have a solid plan that we feel good about."

One of the approaches AMP has taken on behalf of Stop & Shop is to increase the use of contextual targeting, or the practice of displaying ads based on the content of a website. Another tactic is to partner with companies offering new customer IDs that use first-party and third-party data to replace cookies. For example, AMP Agency is testing the ID of LiveRamp, which uses machine learning algorithms to perform identity resolution by combining a company's data with its own massive database of over 250 million US consumers. .

Finally, the agency had previously worked with Dstillery, a client audience solution, on personalized AI-based targeting. This year, they tested Dstill...