Category Momentum > Last-Click Sales
Discover why retail media budgets allocated based on last-click attribution are reactive and starve emerging opportunities. Learn how Category Momentum drives proactive growth strategy.
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Executive Summary
Retail media budgets are often allocated based on last quarter's sales or last-click attribution. This approach is reactive: it rewards existing winners while starving emerging opportunities. A stronger approach is to base budget allocation on Category Momentum, a forward-looking measure of where demand is growing and where the brand has the right to win.
The Trap of Last-Click Sales
Most budgeting processes reward the products, campaigns, or retailers that delivered sales last quarter. But this is a lagging indicator with serious flaws:
- Reinforces the past: Success is rewarded, but underinvested growth opportunities are ignored.
- Starves innovation: New launches or emerging subcategories get limited support.
- Overstates short-term ROI: Last-click data captures conversions but not demand creation or incremental growth.
The result? Budgets get trapped in a feedback loop of past performance.
The Case for Category Momentum
Category dynamics, not last-click sales, drive true growth. By shifting the budgeting lens to Category Momentum, brands can align spend with where future growth will come from.
Category Momentum is defined as a composite of:
- Demand Trends: Rising search volume, increasing shelf space, or shopper penetration.
- Retailer Signals: More facings, new assortments, or retailer feature emphasis.
- Price Dispersion: Expanding premium tiers or value gaps that signal growth.
- Promo Intensity: Competitive aggressiveness and retailer-driven promotions.
Where category momentum is positive, the upside for incremental growth is higher.
A Comparative Lens: Last-Click vs. Category Momentum
| Dimension | Last-Click Sales | Category Momentum |
|---|---|---|
| Time Horizon | Retrospective, past campaign performance | Forward-looking, predictive of growth opportunities |
| What It Rewards | Existing winners | Emerging growth drivers and future potential |
| Risk | Traps budgets in status quo | Requires modeling and forecasting discipline |
| Best Use | Short-term readout | Strategic budget allocation |
| Value to CFO | ROI justification | Growth justification |
Building a Category Momentum Framework
A practical approach to shifting from last-click to forward-looking allocation:
1. Develop a Category Momentum Index (CMI)
- Inputs: demand trends, retailer signals, price dispersion, promo intensity.
- Normalize into a score that ranks categories/subcategories.
2. Overlay Brand Right-to-Win
- Distribution strength, ratings & reviews, price competitiveness, uniqueness.
3. Prioritize Quadrants
- High momentum + high right-to-win: Over-invest.
- High momentum + low right-to-win: Test-and-build.
- Low momentum + high right-to-win: Maintain efficiently.
- Low momentum + low right-to-win: De-prioritize.
4. Reforecast Quarterly
- Refresh CMI every 90 days to adapt to shifts.
The Bottom Line
Last-click sales are a comfort metric—they tell you what already happened. But growth doesn't come from rewarding the past. It comes from funding the future.
By adopting a Category Momentum lens, brands can move from reactive budget allocation to proactive growth strategy—winning not just in yesterday's categories, but in tomorrow's markets.
"Growth doesn't come from rewarding the past. It comes from funding the future."
Key Takeaways
Last-click sales reward the past, starve emerging opportunities
Category Momentum predicts where future growth will come from
Budget allocation should be forward-looking, not reactive
Category Momentum Index drives strategic investment decisions
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