Best Practices for Online Advertising in Retail
A tremendous shift is taking place in online advertising right now. Google is pushing its display capabilities to new levels, Project Devil at AOL is bringing art back into advertising and organizations like the Interactive Advertising Bureau are pushing the industry to innovate with new ad formats. However, regardless of creative execution, the holy grail of advertising is the ability to reach the right person with the most relevant story — whether it’s through rich media or custom sponsorships — at the right time. At the end of the day, ads have one simple goal: to influence and drive purchases.
Online retail has grown at a breakneck pace for over a decade now. That said, it’s been tough to hit profitability with shrinking margins and conversion rates averaging 2 percent to 3 percent. The pressure to keep prices low is driving a tremendous interest in advertising that works. To sustain rapid growth while improving profitability, retailers need to both dramatically improve conversion rates and pursue innovations in online advertising.
Retailers aren't newbies when it comes to acting as publishers in advertising, but their reluctance to embrace it in its current state persists. While shopping for a specific printer on a large electronics retailer’s site, I was distracted by an ad for the same printer, but from a competing retailer. It was a perfectly targeted ad, but a total failure for the original retailer. Most retailers will tell you they don't appreciate it when competitors’ ads show up on their pages.
Along these same lines, the option of participating in a blind ad network opens a retailer's site up to the possibility of display ads disrupting the buying process. Retailers don’t want the "dancing mortgage lady" on their site, even if it's solving for remnant memory. A number of existing solutions fall short of optimizing the customer experience while solving for the retailer's own business goals, so it's helpful for retailers and brands to consider a few best practices for online advertising.