Periods of economic turmoil often lead to conservative business practices as consumers and businesses alike scrutinize their free cash flow. Rightfully so, media dollars deployed within digital marketing strategies become increasingly competitive while a battle of channel distribution and budget allocation ensues. Retailers, and more generally, marketplaces, are presented with a unique opportunity to influence their consumers utilizing information collected directly from those consumers themselves in what’s known as first-party data – essentially, digital gold. First-party data continues to become increasingly crucial to the success of retailers, CPGs, and anyone in the business of selling goods to consumers.

First-party marketplaces are a safe investment for cautious advertisers, as direct-to-consumer channels allow for precise budget implementation. Internal stakeholders who want to absorb excess budget, or optimize underutilized funds, appreciate the ability to influence sales directly in the purchase path of the shopper, which in turn impacts advertisers’ bottom line.

 

Understanding the Downstream Impacts of the Down Economy

Expectedly, during times of economic uncertainty, consumers begin to think more conservatively about their expenditures, especially of items considered less essential. The buying cycle is generally extended and purchases become more intentional; the touch points along the path to purchase become increasingly important as a result. Identifying these changes to consumer behavior unlocks important opportunities for marketplaces, as long as they are equipped to adapt. This methodical approach to consumer buying should be reflected in both the advertiser and marketplace strategy.

Advertiser behaviors are seemingly no different from those of consumers. Budget distribution becomes highly scrutinized with available dollars shifting towards the highest-returning channels that present incremental opportunity. The advertiser is likely to become more involved in the day-to-day operations of campaign strategy, as the results will dictate their next move.

Marketplaces bear the brunt of responsibility to ensure the consumers’ and advertisers’ needs are being met. While the weight of such responsibility can lead to pause, the marketplaces built to be nimble and adaptive have every opportunity to lean in and take advantage. It is imperative that the needs of the advertisers are addressed as this will lead to a strengthened, longer lasting relationship.

 

Commonly Underutilized Marketplace Features

Have you considered all of the possibilities your marketplace can introduce to set you apart from the competition? The most frequently utilized and requested features by advertisers involve intelligent audience segmentation, custom targeting using first party data, pacing features, reporting, and insights.

Features that could set you apart from the competition are only as good as your ability to adapt and adjust. Consumer behaviors are an ever-evolving pattern that, if dissected appropriately, can be used to enhance their experience along with the advertisers’ likelihood of pursuing them.

The effort of site monetization as a whole within an ad program does not produce sustainable and repeatable results. Only when you begin to optimize your ad program to your consumers’ behaviors will you truly begin to reap the benefits in added profit. Otherwise known as yield optimization, tailoring your ads to intersect consumer behaviors can be as simple as testing a singular placement of the ad unit or as involved as dynamically populating the number of ad units available with strategic in-line placement.

 

Understanding Marketplaces from Behind the Scenes

A 2022 prediction from AdMonsters projects that “US Retail Media Networks will exceed $52 billion in ad sales by 2023.”

Maximizing revenue-per-click on your site should not only be evaluated through revenue driven at checkout, but also through the impact that direct advertising dollars could generate. In recent years, online marketplaces have quietly been one of the highest-performing business units across an organization by profit margin.

 

Recommended Action Plan

So what does this mean for your business? For those who are already operating a media network: 

1. Review recent changes in consumer behavior and trends.
2. Understand your advertisers’ needs and implement solutions that encourage budget retention. This could pay dividends in the long run, potentially making a case for acquiring additional budgets through channel shifts. 
3. Involve your data science teams to enhance your customer segmentation, customer-specific scoring based on relevancy, and most frequent paths to purchase against available ad units.

 

For those looking to introduce a media network:

1. Research the benefits of implementing a media network and how it could help your bottom line.
2. Gather feedback from those who have ventured down this path previously.
3. Ask questions!

 

Talk to Koddi about how to prioritize site monetization for your existing program or let us know how we can help you build your new media network.