Commerce media is currently enjoying “Next Big Thing” status, having been dubbed the “third wave of digital advertising” (after search and social). McKinsey predicts that 1.3 trillion dollars in enterprise value is possible by 2026, with most of that revenue going to retailers. Walmart and Amazon have jumped out to an early lead, but future growth rests squarely on the shoulders of more online retailers embracing a commerce media strategy.
Five Steps for Launching a Commerce Media Strategy
Since many retailers and publishers will be exploring commerce media over the next 12 months, here’s an overview of the actions they will need to consider:
1. Dip a toe
If commerce media is unfamiliar territory, experimenting with lighter versions could help retailers determine if it is right for them. Turnkey partners like adflow open up new revenue streams without any of the in-house capabilities and associated costs that go along with servicing big advertisers. Other low-commitment commerce media add-ons include:
- Exit Intent Pop-Ups: Exit behaviors – like moving a mouse up and to the right – trigger a pop-up ad that makes an offer that is meant to entice a customer to stay on the site.
- Newsletter Advertising: For retailers with existing newsletters, inserting ad units is a great way to experiment with digital advertising, test vendors’ appetites for additional marketing opportunities, and monitor consumer response.
- Video Commerce: Retailers can use video to demonstrate how certain products work and then sell them through links in captions or embedded into the videos.
- Social Commerce: As a tool for encouraging transactions, social commerce involves posting about a product via social channels and including links to purchase the product online. Retailers can leverage social commerce to take advantage of the built-in social networks they have grown organically.
2. Define the North Star
Retailers choosing to take the commerce media plunge will need a clear statement of their business objective(s) and customer profile(s) to help guide their decision-making.
- Business Objectives: New revenue stream? Reaching new customers? Improving customer engagement? Increasing average revenue per customer? Each business must decide its own unique business goals. From there, they can shape a commerce media strategy around their objectives.
- Audience Characteristics: Isolating the data signals connected to customer behavior, preferences, and buying habits will help customize a commerce media property, enhance the shopping experience, and open up new opportunities for advertising partners.
3. Determine A Game Plan
Before embracing commerce media, online retailers must decide where, when, and how often ads will appear. Some experimentation will be necessary – here are a few variables to keep in mind:
- Placement: Determine the optimal ad placements that catch users’ attention without being obtrusive. Will ads appear in search results, product pages, or alongside relevant editorial content? Test different placements to find what drives the best engagement and conversions.
- Formats: Common ad formats include sponsored articles, native ads, display ads, product placements, and video content. Online retailers should choose formats that seamlessly integrate into the platform’s layout and flow.
- Targeting: Those entering the commerce media space will need to leverage customer data to tailor ad content and placements. Behavioral data will provide direction for when and where ads are most likely to be effective.
- Privacy: Protecting customer privacy should be at the forefront of every retailer’s data strategy. Never share data without an airtight privacy plan in place.
- Frequency: Too many ads can lead to user frustration and ad fatigue, ultimately negatively impacting engagement. Online retailers should consider factors such as the length of user sessions and the type of content being viewed.
4. Sell It
Each retailer brings something unique to the table, which can be central to the selling proposition. Online retailers must eventually get to a point where they can clearly articulate their unique value to advertisers. They should highlight the platform’s reach, engaged user base, brand safety, and any available demographic or behavioral targeting opportunities.
- Media Kit: Online retailers should create an attractive and professional-looking media kit outlining advertising opportunities, as well as available ad formats, pricing models, placement options, and audience reach. A media kit can also include case studies and/or client quotes whenever possible.
- Audience Insights: Customer insights gathered from data analysis will provide potential advertisers with a deep understanding of audience demographics, preferences, purchase behaviors, and browsing patterns.
- Customization and Personalization: An online retailer should highlight the ability to deliver tailored ad experiences. Personalization is one key selling point, as it leads to higher engagement and conversion rates. Creating custom content aligned with the site’s style is another feature to highlight.
- Cultivate Relationships: Despite all the algorithms and machine learning, the advertising business is still about people. For retailers striking out on their own, they should identify the decision-makers within big advertiser organizations and reach out. They should also attend industry events to connect with potential partners, establish a genuine rapport, and demonstrate real enthusiasm for collaborating on mutually beneficial campaigns.
5. Expect Expectations
Being a good media partner means anticipating the client’s needs. Getting ahead of expectations is critical to doing business with them.
- Establish Clear Guidelines: Online retailers should be very clear about the types of ads they accept, the technical specifications, and the content standards they must adhere to. This ensures the ads align with the platform’s values and contribute to a consistent user experience.
- Get the Data House in Order: The better the data, the better the reporting, the results, and the profits. Customer data housed on multiple spreadsheets won’t yield the reporting or insights necessary to run a commerce media business. They will need a CRM and a person who knows how to maintain it.
- Automate Reporting: Good commerce media providers will make reporting a core competency. They will regularly monitor ad performance using key metrics like click-through rates, conversion rates, and engagement metrics to close the attribution loop. The data will be used to refine strategies and optimize placements and frequency in order to achieve the best results. This will demonstrate the effectiveness of the platform and build trust with new advertiser clients.
- Continuous Communication: Maintaining open lines of communication with advertisers is pivotal to the success of commerce media partners. This includes regular campaign updates, insights, and recommendations for optimization. A commitment to collaborative success will strengthen the relationship and encourage long-term partnerships.
Getting Started with Commerce Media
Finally, it’s important for online retailers to remember this isn’t a “build it and forget it” proposition. Staying ahead of industry trends and technology advancements will help maintain a steady flow of fresh and effective advertising opportunities. Successful commerce media partners will embrace emerging ad formats, technologies, and trends to keep their platforms relevant and engaging for both users and advertisers.
Ready to transform your site into a powerful commerce media engine? Connect with us here to launch your commerce media strategy today.