Demystifying Retail Measurement: A Refocus on Customer Metrics and Business Outcomes

Retail media networks (RMNs) have become as mainstream as existing content and advertising channels. The problem is that RMNs are still measured according to traditional metrics like clickthrough rates and impressions.

However, just as retailers embraced a new model when they added data monetization and publisher functions to their strategy to create RMNs, pioneering retailers like Walmart and Albertsons are getting back to basics. They’re focusing on the customer behaviors and business outcomes that actually drive visits and sales.

The reasoning is simple: outcomes are the true measure of advertising and marketing success.

What Outcomes Actually Mean

In the media space, there’s been endless chatter about moving away from vanity metrics. Coming from many years on the media side, I can tell you that clicks, CPMs, and CTRs are interesting data points. However, they’re not the data points we need to inform how we optimize or develop sales-driving efforts.

Retailers and retail media networks need to take a lesson from Walmart: put the customer first. Walmart already knows what its best customers look like, what they choose, when they choose it, and why. It doesn’t matter if you’re a sporting goods retailer or a home improvement chain, customers who shop across categories are the most loyal. Shoppers who visit multiple times per week or place frequent orders represent the highest customer lifetime value (CLTV).

The Metrics That Matter

So what should retailers measure? Customer acquisition. Basket size. Purchase frequency. Cross-category conversions. These are behaviors that define your best customers and should be the foundation for how you configure campaigns and allocate investment.

Early signals, like content engagement and site visits, remain important indicators that customers are responding and which brands are top of mind. However, you need to apply an incrementality lens. Let’s say you’re investing budget with the goal of getting customers to shop across categories, but they haven’t increased their purchase frequency or basket size. After all the math is done, the incrementality probably isn’t there. At that point, you might move on to explore other strategies or channels.

For retail media networks especially, this outcomes-based approach is critical for securing greater share of ad spend. Brand partners need proof points: a 20 percent increase in new customers for a specific product or category, units per basket growing from 1.2 to 2.3 over two quarters, and customers shopping their brands both in-store and online. Retailers have the data to provide shopper behavior metrics that truly show sales growth, trial, and loyalty.

Building the Foundation

Delivering these insights requires a holistic view of the customer across every channel. But that’s just the first part.

The next part, which retailers are getting increasingly good at, is connecting in-store personas with online activity. However, achieving advertisers’ ultimate objective requires understanding customers across all touchpoints and tying it back to outcomes. Whether it’s driving a purchase, inspiring a lead, or demonstrating brand loyalty, the outcome is what determines a successful campaign from a failed one.

Complicating the process, many retailers face challenges with legacy systems, “tech debt,” and organizational silos where different teams use different datasets. The good news? With machine learning and artificial intelligence-based tools, retailers increasingly have the ability to make true outcome-based decisions. Investment in their data infrastructure also lays the foundation to deploy agentic commerce and conversational shopping tools.

It’s time to balance short-term campaign metrics with incrementality, CLTV, and loyalty measures. Identify what behaviors and outcomes really define your best customer, then reconfigure your campaigns and investment with those goals in mind.

The data is there. Now it’s time to put it to work.

Lynn Rupprecht is the commerce media practice lead and an advisor at MadConnect, the Intelligent Connectivity Layer (ICL) powering the new era of modern marketing and advertising.