Home AdExchanger Talks ROAS? Nah. The Home Depot’s All About ROMO

ROAS? Nah. The Home Depot’s All About ROMO

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Melanie Babcock-Brown, VP of media and monetization for Orange Apron Media, The Home Depot’s retail media network

Seriously, guys. Enough with the ROAS (return on ad spend) obsession.

It’s time for a smarter approach to measurement that focuses on more than short-term outcomes, says Melanie Babcock-Brown, VP of media and monetization for Orange Apron Media, The Home Depot’s retail media network.

When retail media took off around five years ago, retailers concentrated on the bottom of the funnel, because that’s relatively easy to do, says Babcock-Brown on this week’s episode of AdExchanger Talks.

Fair enough. In 2019, when their RMNs were new, retailers wanted “quick wins,” she says.

“But as you mature as a retail media network,” Babcock-Brown says, “you need different forms of measurement frameworks.”

And that’s especially true for brands like The Home Depot with long customer journeys.

Some home improvement buying decisions are necessarily made quickly. If someone’s refrigerator breaks, they typically replace it within 48 hours. But it could take six months to decide on a new paint color for their walls or a year to get started on that kitchen project they’ve been thinking about, Babcock-Brown says.

High ROAS won’t capture the full value of a long consideration period, and it won’t give an advertiser much – if any – insight into how their media is driving incremental growth, brand equity, new customer acquisition or long-term loyalty.

And so The Home Depot developed a new framework called ROMO – it stands for “return on marketing objective” – to measure the overall impact of retail media campaigns across the entire customer journey.

(Credit to Zach Darkow, The Home Depot’s senior director of marketing activation and measurement, for inventing it.)

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For building a long-term relationship with your customers, Babcock-Brown says, using ROMO to look at the bigger picture simply “makes more sense.”

Also in this episode: Whether there are too many retail media networks (yes, there are), what it takes to build, maintain and optimize an in-house RMN (a heck of a lot of work) and home improvement hacks (look for the stud when you’re hanging stuff on the wall).

Plus: An important tip on the best way to store Thin Mints (IYKYK).

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