Kroger Reports 24% Profit Growth in Retail Media Division
Profluence Intel Desk · September 16, 2026
Kroger's advertising business, Kroger Precision Marketing, saw its highest profit growth since 2021 as the retailer expands its digital ecosystem and off-site data capabilities.
Financial Performance and Strategic Shift
Kroger reported that its advertising division, Kroger Precision Marketing (KPM), achieved a 24% increase in profit during the second quarter. This represents the unit's most significant growth rate since 2021. The expansion of the retail media business is occurring as the company navigates a broader grocery landscape defined by thin margins on physical goods. By leveraging first-party shopper data, Kroger is transitioning from a traditional grocer into a high-margin service provider for brands seeking targeted consumer access.
Data Infrastructure and Off-Site Expansion
The growth in KPM is attributed to the company's focus on first-party data utility. Unlike traditional advertising methods, Kroger uses its loyalty card program to track actual purchase behavior, which it then offers to brand partners for performance measurement. A key driver in recent months has been the expansion into 'off-site' advertising. This allows brands to use Kroger's audience data to target consumers on external platforms, such as social media and connected TV, rather than relying solely on Kroger's own digital storefronts.
Collaborative Commerce and Automation
Kroger is also investing in self-service tools for advertisers, making it easier for smaller brands and agencies to manage campaigns without direct intervention from the retailer. The integration of advanced measurement capabilities allows brands to see the direct correlation between digital ad spend and in-store sales. This closed-loop attribution is a central component of Kroger’s value proposition, as it addresses the industry-wide demand for more transparent return-on-ad-spend metrics. Additionally, the retailer is exploring how generative AI can streamline the creative process for these advertisements to further scale operations.
Why it matters
As retail media networks mature, they are evolving from simple on-site search tools into full-funnel marketing platforms. For brands and creators, this shift emphasizes the increasing value of first-party purchase data over third-party cookies for targeting and measuring campaign effectiveness across the open web.