How Woolworths, Loblaws, and other retailers are developing digital advertising arms and profiling customers, aiming to become ad venues for large brands
Alistair Gray / Financial Times :
Context & Ripple Effects
This is the maturation of a move that started years ago, when Target, Walmart, and Tesco began selling ads and search keywords on their own sites to consumer goods companies. What was then a website monetization tactic has become a formal business line: Woolworths and Loblaws are building dedicated digital advertising arms around customer profiling.
The timing tracks the broader budget migration already visible when Publicis, Omnicom, and WPP boosted Amazon ad spending by 40% to 100% hunting for an alternative to the Facebook/Google duopoly. Grocers hold something neither platform has at scale — verified purchase data tied to named households — and they are now packaging it for large brands.
First-order effects
- Large brands gain a new targeted-advertising venue built on Woolworths' and Loblaws' shopper profiles, while the two retailers convert loyalty and checkout data from a cost center into a revenue line.
Second-order effects
- Rising digital advertising costs are already reshaping brand behavior — [[a:840025|nearly half of online footwear, apparel, and accessories brands tracked by Coresight have opened physical stores]] partly because of them — so every new retail media arm adds another bidder for the same brand budgets, pressuring agencies to split spend across retailer networks.
Third-order effects
- If the pattern holds, advertising competition shifts from audience reach toward ownership of transaction data, structurally favoring retailers and marketplaces that sit between brands and buyers — and pushing the Facebook/Google duopoly toward whatever purchase-level signals they can still obtain.
The trend: Retail media is turning grocers' first-party purchase data into an advertising business that competes directly with the platform duopoly for large-brand budgets.