March 5, 2019

The Convergence of Ecommerce and Programmatic Media

Digital advertising has been on a rapid ascent in the last decade and, according to eMarketer, it’s expected that digital ad spend will outpace traditional ad spend in 2019.

Digital Media Spend is Outpacing Traditional in 2019 | SellPoints

The reasons for this shift are clear to us today.

Before the digital age we had very limited intelligence when it came to reaching target audiences and we encountered “spray and pray” efforts everywhere through print, billboard, radio, and television. Market research informed us with loose interpretations of geographic, demographic and even some behavioral information, but this information was generally limited to cohort analysis. True behavioral marketing was nearly impossible. In addition, these methods were costly and inaccurate;  reaching a substantial number of people who were not the intended audience.

Today system configuration and coordination between the product detail page and programmatic media makes it possible to more accurately attribute customer acquisition costs, test different messaging, and target more precise audiences based on behavioral characteristics. This all translates to more efficient media spend.

We’ve seen how digital natives, such as Amazon, have dominated ecommerce by pioneering this technology and process. Customer reviews, rich media content, algorithmic suggestions, fast shipping, and deeper levels of product information, have all resulted in higher shopper expectations. According to eMarketer, 65% of US Digital Shoppers expect consistent levels of service across physical and digital channels. Moreover, 55% of those surveyed expect the flow of information to be frictionless –that is, consistent between multiple channels.

DIgital Shopper Expectations | SellPoints

Amazon’s technology and highly-refined internal organization provided them with a competitive advantage when it came to ecommerce product page optimization and programmatic media. Today, retailers are investing in similar technologies to elevate the online shopping experience and capture a higher market share of digital shoppers.

On February 28th, we sat down with the president of SellPoints, Jon Gregg to talk about these investments, and how brands and retailers are unifying their marketing systems across ecommerce and programmatic media buying to reach high-converting audiences and optimize ROAS. This new content management approach is a response to the following industry challenges:

Challenge #1: Lack of Transparency

One thing we hear all the time from brands is that there is a lack of transparency between them and retailers marketing campaigns. Brands are often required to contribute to Market Development Funds (MDF) in order to sell on most retailer sites, but have limited information and influence over the ads those funds subsidize. Even when brands have insight into time spent on page and add to cart rates of their product pages, attributing conversions to the proper sources is nearly impossible.

Challenge #2: The Current framework misses a massive opportunity to optimize yield

We know that behavioral data provides insights into buyer interest and readiness. For years, retailers have used information such as browsing/purchase history to segment and target customers based on their product interests. The limitation here is that retailers don’t know enough about why customers are interested in a product. Recently, it has been proven that creating more touchpoints allows brands to better understand shoppers. The data gathered from a more complex level of customer engagement can be analyzed to understand specific degrees of interest, which can be then used to customize future content displays and to optimize programmatic bidding.

To learn more about how ecommerce and programmatic media are converging, download our full-length webinar using the form below.

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