Programmatic Display: How to Choose the Best Media Partner

Programmatic display is a growing, thriving performance channel in high demand.  Unlike Search which has two core media partners – Google and Bing – with Programmatic there are many potential partners which seemingly provide the same offerings from sources like MediaMath, Turn, Adroit Digital, Quantcast, Rocketfuel, Ad Roll and more.  Knowing how to screen these partners to match to a particular business’ specific needs can yield success.  Here are some key attributes to help when considering the best partner match.

  1. Transparency:  The biggest advantage of Programmatic is the low prices but with that comes a lack of transparency.  Before signing on with a display partner, one should ask if reporting includes insights only or actual site list performance, and to the latter point, how much.
  2. Minimum Monthly Spend:  Determining the testing budget threshold is a top priority insofar as it may screen out some partners from the onset making the consideration set smaller.  Some media providers have small monthly minimums and others are in the $25k/month range.
  3. Remarketing vs. Prospecting:  If finding new customers is a priority, the choice of media partner must include one who has evolved their prospecting methodology.  Some of the top Demand Side Platforms (DSPs) still only offer remarketing (which mostly attracts prior customers) as their core competency.
  4. Audience Targeting:  Probably the hottest area in Programmatic is audience targeting.  If this is a goal, finding a media partner who can not only work with first party data but also offers sophisticated services to leverage it will be key.  If interest lies in developing a Data Management Platform (DMP) solution, this is all the more important since the DSP, which acts as the plumbing, will need to support CRM efforts.
  5. Creative Capabilities:  There are some Programmatic partners who yield strong performance but lack in their creative offerings.  In the case of a brand-conscious retailer, this particular attribute will be far more important.
  6. Self-Service vs. Fully Managed Platforms:  The key to deciding on which way to go with this attribute lies primarily in who on staff is managing Programmatic.  If they come from the Search world, they will be more comfortable and adept at working with a self-service partner.  If they come from the Display side, they will likely gravitate to fully managed.  There are cost savings with self-service, but the fluency and expertise in execution must be there.
  7. Vertical Expertise:  Possibly the easiest attribute to screen is the level of expertise a media partner has in a given vertical (Retail vs. Education vs. Healthcare vs. CPG, etc).  Chances are good that the DSPs modeling capabilities are more evolved for the categories they primarily service.
  8. Pricing Model: CPC, dCPM, CPA:  Similar to (6) above, preference for pricing model – which may drive the media partner selection – will be a factor of where the display team grew up:  Search or Display.  Search marketers gravitate to the CPC model, and Display marketers to dCPM.  Those who are risk averse often choose CPA despite the totally limiting transparency.  Note that after years of experimenting on both sides of the business, PM Digital frequently finds the dCPM model to drive better ROI for display campaigns.
  9. Attribution Plug In:   For those Programmatic marketers who have invested in an attribution technology provider such as Convertro, Visual IQ or Adometry, whether or not the tool can interface with a particular display media partner will obviously be a critical component in the selection process. The interaction between the two would enable fractionalized revenue from one system (ie: a Kenshoo) to feed into another (ie: a MediaMath).
  10. Cross Device Targeting:  Many providers are striving to develop cross device targeting and others are further along trying to perfect it.  Through matching IP addresses, cross device targeting enables a DSP to serve banners on all devices to a single user who is/has been on the web.  As shopping behavior continues its shift from researching on one device and buying on another, cross device targeting can be very powerful to tie together otherwise fragmented web usage and connect the conversion to a single user.

Enhanced Campaigns: What it means for KPIs

With the July 22nd deadline looming for Google switching their UI over to Enhanced Campaigns, most search marketers are focused on migrating their campaigns over and benchmarking their performance pre and post Enhanced.    From an agency point of view, there are two intense levels of interest.  The search marketers are learning the ins and outs of the UI and doing the physical work necessary to move these campaigns over.  The marketers are watching performance to see how KPIs will be impacted from Enhanced.

 

From the perspective of the search marketer who has always had to do the heavy lifting managing search campaigns, Google’s new UI will be an incredible time saver once they get past learning the new UI and achieve an operating comfort level.  Campaigns that had to be created in triplicate (smartphone, tablet and desktop) now only have to be done once.  From the perspective of the advertiser themselves, the benefit of this is that the search marketer is going to win back lots of time, freeing them up to focus on strategy, copy and landing page testing, new keyword creation and other forms of testing that they didn’t have time for before.  Marketers/Advertisers should be pushing their agencies for more strategic thinking since the time physically spent managing their campaigns should drop significantly.

 

Likewise, there are new opportunities to fine tune performance of a campaign with Enhanced (site links at the ad group level, mobile extensions, cross device reporting, and others), which will ratchet up the sophistication of search marketing.  Search marketers are being given a lot of new levers to pull, and they need to understand how to use these opportunistically.  Advertisers need to understand that these levers exist and be open to new forms of testing that was not possible (or took considerable effort) before these UI changes.

 

There are three phases of migrating to Enhanced, and most search marketers should now be getting close to the last stage:  1) Migrating existing campaigns to Enhanced; 2) Benchmarking Performance; 3) Stabilizing Performance.  The July 22nd date is significant in that it should be ample time to get KPIs under control before the 4th quarter.  

 

The KPIs most susceptible to being affected by Enhanced are cpcs.  Many marketers have seen cpcs rise pre-Enhanced throughout the latter half of 2012 and year-to-date in 2013.  The biggest concern with Enhanced from the start was the fact that tablet campaigns are now rolled together with desktop, and for many advertisers, performance on these devices is quite different.  That is what many are benchmarking for now since we all have to live with this – there is no work around.  Additionally and because of this, there will be an influx of advertisers in the auction encompassing those who had previously opted out of tablet because of either weak performance or because it was too time consuming to clone the campaigns.  More advertisers in the auction typically means higher cpcs for all.  What we don’t know yet is how much impact the new features of Enhanced will have on quality score and if better quality score can lower cpcs enough to offset the effects of increased competition in the auction.  Understanding the going-forward impact on KPIs is what I’d consider Stage 4 of Enhanced.

 

Lastly, what I believe is the biggest benefit of Enhanced Campaigns is still unknown, and that is how useable and actionable the Cross Device Reporting will be.  It is unknown because it hasn’t been released to any advertisers yet but is due to be in the next few weeks.  With most marketers struggling to hit ROI metrics running search on smartphones, the ability to tie clickstreams together across devices should lift performance for this device.  With some marketers seeing 50% of their traffic but only 10% of their revenue coming from smartphones, visibility to cross device metrics should finally enable this channel to scale, which will be a benefit to all in terms of yielding more revenue from search .

Same Day Shipping: Google vs. Amazon.

Google’s announcement that they are launching same day shipping is interesting and strategic given the emergence of Amazon as a likely reason for why impressions may be on the decline for some retailers in Google paid search.  This was pronounced in this past 4th Quarter, and it’s most likely due to searchers moving to Amazon and, to a lesser extent, mobile apps to initiate their shopping.

 Amazon has been building the infrastructure to offer same day shipping with the goal of eventually making this the norm as a shipping option.  It is likely that same day shipping won’t be widely in place for the upcoming Holiday, but it will in use in use, for sure, with expansion imminent.   

 The big unknown is how important same day shipping will be to consumers.  Based on Google’s action to build out this capability and Amazon’s investment to support it, both companies assume it will be.  From the B2B side, Amazon provides this capability for their retail partners who don’t have the infrastructure to build it themselves.  This has become a nice advantage to participate with Amazon.  With Google’s announcement, this opens the door to same day shipping for retailers who are already Google advertisers (ie: basically everyone) so businesses no longer have to be an Amazon partner in order to provide it to their customers.

While Google’s announcement would appear to level the playing field and stem the tide of people going straight to Amazon for their ecommerce purchases in order to get same day shipping, I am not sure it does.  There is another leg to the stool which may play a really important factor, and that is Amazon Prime.  Where Amazon Prime comes in is that once same day shipping is more fully rolled out, consumers can potentially order and receive same day purchases at no shipping cost.  And what same day shipping facilitates is the ability and convenience to order everyday items that consumers wouldn’t normally purchase online like drugstore items, stationary supplies, etc.  The effect of this will be further growth in ecommerce and into categories that haven’t made sense up until now from the consumer’s perspective.  Lastly, Amazon continues to evolve their value add for gaining new subscribers to Amazon Prime.  An example of this is their bundling in access to their library of video content.   For these reasons, from the consumer’s perspective, Amazon may still have the edge over Google even with Google’s ability to support same day shipping.  From the B2B perspective, if Google were to build same day shipping into the Quality Score algorithm, they may get really fast adoption from their advertisers.

 While Amazon represents a threat in terms of its ability to siphon off searches from Google, with continued evolution on Google’s part, it can effectively minimize future erosion  – definitely from the B2B side but possibly from the consumer side, too.  Its push into image ads with PLAs has been effective with some advertisers now seeing as much as 25% of their paid search revenue coming from this ad unit indicating a preference on the part of the consumer to click on them.  The consumer has been trained to use Google for 10+ years, so if Google continues to evolve by providing a great shopping experience presenting the type of ad units consumers like and lots of value add like Amazon offers, they will continue to dominate.  To this end, same day shipping is a great move in this direction.

Performance Display: 10 Reasons to Love It Now

Performance display is having its day.  I wish I could say “finally having its day” but can’t because it’s only recently that display has emerged as a bonafide direct response channel.  By “bonafide ” I mean that on a click basis, the display ad units hit the target p&l goal.  As you’ll see below, results for display can be made better by applying some portion of view through revenue to the campaign, but unless the performance on a click basis can stand alone, then the skepticism of using display for direct response will persist.  

The history of display is a winding road of evolutions – none of which amounted to much potential for direct response marketers.  There were the premium ad buys, the black hat buys (remember Gator?), the ad network buys that promised good targeting but performed mediocrely at best.  Google offered (and continues to) display in its Google Display network, but the scale isn’t there because of how time intensive it is to maintain, and even Google advises against measuring display comparably to search.  The words “branding” and “awareness” are real when applied to display, but they are irrelevant for direct marketers since they aren’t pertinent metrics. 

As we enter into 2013, there are multiple factors pushing display to the forefront of direct marketer’s media plans.  Much is related to evolutions by the media providers, which have been substantial.  Others have nothing to do with that but are pushing direct marketers toward display nonetheless.  Here is a rundown of some of the big reasons why display is emerging as a growth channel for direct marketers going into 2013.

1)      Paid Search CPCs are rising:  Google and Bing’s CPCs in 4Q12 skyrocketed for both trademark and generic keywords across marketers in all verticals.  Worse, they haven’t fallen any post-Holiday, which means any more growth coming from paid search will cost a fortune.  The escalating prices have affected marketers with 100% impression share on their trademark terms as well as those with more competition.  It is probable that the investment needed to grow paid search will cost far more than it would from performance display.  This is the top reason why marketers in 2013 will be testing – and then rolling out – display. 

2)      Big box retailers now use co-op funding for paid search further driving up prices:  On top of the higher prices in Google and Bing’s auctions, prices are further being driven up by retailers who can afford to pay more for paid search because they are applying co-op funds to their paid search campaigns.  Brands, specifically, are the most adversely affected; although, it is the brands themselves giving the co-op funding to their retail partners.  Unfortunately, the co-op funding comes from a different internal group than those managing paid search.   If paid search is important to a brand’s marketing plan, there needs to be some internal coordination to set some rules here. 

3)      Facebook made its inventory available through the ad exchanges for retargeting: Ad exchanges have a ton of premium sites in their inventory, but Facebook was never one of them, and Facebook never offered remarketing on its site before.  Now this inventory, called Facebook Exchange, is available through most of the major ad exchanges. It performs fantastically and has both retargeting and prospecting elements.

4)      DSPs have improved technology, and the proliferation of them has driven down prices:  There are many sources for buying through the ad exchanges giving access to direct marketers to huge inventories at low prices.

5)       There are many fully managed DSP solutions available making it turnkey for marketers: If a direct marketer doesn’t know how to navigate the waters of programmatic buying for display, it is seamless to outsource the entire campaign to an agency or DSP who will manage it soup to nuts.

6)      Pixel-based dynamic remarketing eliminates the need for datafeeds:  There are DSPs who can run dynamic remarketing campaigns just by pixeling the advertiser’s site.  This negates the need for supplying a datafeed, which can be time consuming and expensive to maintain and optimize for maximum performance.  Many marketers now have container tags in place, which makes pixel implementation straightforward, easy and fast.

7)      More sophisticated tracking provides visibility to display’s impact on other channels:  When running display, it is now the rule rather than the exception to ensure performance can be read based on click as well as view-through conversion.  Taking it a step further, by applying the same tracking to all marketing programs, you can easily see the overlap across channels.  The only downside are the ad serving fees, but many feel the small tracking costs are worth it for the sophisticated attribution visibility.

8)      Advertisers acknowledge that some revenue from view-through conversions is legitimate:  Remarketing initially got off to a bad foot because some of the early leading media providers charged revenue share for all orders, not just those that were click-based.  This caused years of distrust of the “view-through conversion,” and only now are marketers starting to create business rules for not whether to – but rather – how much view-through revenue to apply.  Some take a blanket percentage (usually in the 10-30% range); whereas, others apply revenue within a window of time that is in close proximity to when the view-through conversion occurred.  Depending on how much view-through revenue is applied, a display campaign can go from good to great to fantastic.

9)      Use of display for episodic purposes is effective: With the evolutions in targeting ranging from behavioral to geo to contextual to interest-based combined with the ease of launch, the ability to use display to promote something specific such as a store opening or a semi-annual sale or an event is proven and much less expensive than it used to be.   As an agency, we are seeing lots of demand for these types of campaigns.

10)    Creative assets are not even necessary, sometimes:  While creative is hugely important to the performance of a display campaign, advertisers don’t even need to provide any assets in order to launch display campaigns that yield terrific performance.  Many of the media providers provide creative free of charge with large-enough buys, and they know what works best.  For those running dynamic creative campaigns, all that’s needed is a template, and the feed or the pixel (see #6 above) populates the ad unit to make up the entire banner.

For marketers who want to test performance display, $15,000 is the minimum amount needed in order to see if the channel holds promise.  As test plans are made and evaluated for 2013, display would be a very beneficial one to throw into the mix.   

NRFs Big Show: First time Attendee

This past week I attended for the first time the National Retail Federation’s big show that
was held at Javitz in NYC.  This was the first year that Shop.org combined its First Look show with the NRF, which is the reason I attended, and I am so glad I did. Typically
I attend the eCommerce retail shows including the Shop.org Annual Summit, eTail
East and West, and IRCE (Internet Retailer). All of these shows focus primarily
on eCommerce.

What I liked about the NRF show was that it gave me a much larger purview of all retail priorities and issues, and this 360-view gave me great perspective. We met and spoke to many interesting people, and the interest in eCommerce and Social Marketing was evident by many top retailers who don’t focus on those areas as intently as we do at the digital agency I work for, PM Digital.

Social Marketing, in particular, was the online cateogry of the most interest for those with limited eCommerce experience, and it clearly crosses over to many other areas within a retail organization. As exhibitors of the show, we had a chance to speak with many of these people and had some great, insightful conversations.  It helped us understand retail priorities in the social sphere beyond revenue generation, which is the area most of our clients focus on.

I walked the entire exhibit hall and found that it was very tech focused in terms of ways to automate and make the entire retail process more efficient and streamlined from point of sale to hiring, people counting, digital signage, analytics, and much more. 

From an exhibitor perspective, coming from someone who has worked the booth at countless eCommerce shows for 8 or so years, when the NRF attendees stopped by our booth and asked what we did, they really didn’t know and asked their questions with a high level of interest and curiosity. When we are asked that question at the eCommerce shows, what the attendees typically want to hear is how PM Digital differs from the competition.
At the NRF show, though, they really meant they wanted to KNOW what we did. It was refreshing and gave us an opportunity to showcase what we love and are so passionate about which is eCommerce.

I will definitely attend NRF again next year and highly recommend it to all eCommerce professionals.

Top 2013 Priorities as told by Retail CEOs

Top 2013 Priorities as told by Retail CEOs

It is always interesting to hear the year’s top priorities per the CEOs at top retail companies.  This was a great read.

Top 10 Digital Issues

Top 10 Digital Issues

I am often asked what are the top issues Digital marketers are thinking about. I have seen two good articles this week addressing topic. This one definitely covers what many marketers are thinking about and building strategies around in terms of Digital priorities.

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