As brands continue to grow their eCommerce presence across multiple retailers it becomes increasingly important to implement an integrated cross-platform advertising strategy. This allows for a comprehensive execution focused on nuanced states of your business and goals specific to each retail platform. Rather than launching a broad advertising campaign, it is important to consider the requirements of each platform. When designing this advertising mix there are several key considerations.
What are your Goals?
All strategies should start by defining goals and working backwards. Goals should be focused on your brand and platform agnostic. However, to achieve these goals, brands need to consider the unique offerings and constraints of each platform to implement strategies for leveraging these nuances. For example, if the goal is to drive growth in sales volume, budgets may be allocated at a higher amount to a platform for which you have a low share of search. Conversely, to achieve new product awareness budgets may be aligned to the size of platforms’ consumer bases with a focus on maximizing impressions.
Prior to launching ad campaigns selection profitibility should be reviewed to assess whether a positive business impact will be achieved. Each retailer offers different cost structures for selling products on their platforms. This may lead to diverse levels of profitibility on each one, and at times negative margins depending upon your goals. To forecast ROI, brands should not only review historical traffic and conversion, but also per unit profit. For example, a 10.5 return on ad spend will be negative if the cost of advertising per unit exceeds the margin per unit. However, it may be that driving visibility and velocity through search results is more important than short-term profit considerations. Furthermore, profitability should be reviewed on a monthly cadence to assess ROI vs brand visibility. If your contractual terms for a retailer limit your ability to execute advertising campaigns, focus on negotiating better terms and content optimization for organic relevance while reallocating those funds to other more profitable retail partners.
Confirm Inventory Levels
Forecasting weeks of cover and analyzing inventory levels across your supply chain is critical to a successful advertising campaign. Utilize historical data to understand trends in sales lift during advertising periods. If inventory levels differ significantly between retailers, advertising budgets should be aligned accordingly to weeks of cover to drive inventory turnover to avoid out of stocks.
Strong conversion maximizes your advertising investment. Evaluate your conversion rates across retailers and align budgets to retail partners that will provide the best long-term results via strong conversion. Prior to launching ads on a retail site in which you have low conversion focus on improving detail page content and reviews. Alternatively, running a promotion in parallel to an ad is a great strategy to increase conversion pending profit margins allow for both promotions and advertising.
Know Your Target Audience
Not all targeting options are consistent across retailers. When targeting a niche audience that aligns to your product’s value proposition understand and spend on advertising platforms that provide the ability to exclude consumers which will likely be low converters. This strategy will allow brands to selectively use unique consumer data per platform to optimize depth of targeting and drive higher returns on ad spend. Examples of this opportunity are Amazon DSP’s ability to target by past purchases and geography or using “Did you forget” to advertise items that are frequently purchased together on Instacart.
Actions taken by competitors can open or close doors to advertising success. For example, if a competitive brand is currently running a promotion, ads showcasing a full price product are not likely to be very successful. However, if you have a strong value proposition as compared to competitors, but a low share of search, advertising on their brand term is a good way to showcase your brand and gain market share. Continuously evaluate your ad placements and confirm you are offering a compelling value proposition relative to competitive options. If not, evaluate your messaging, price, and ad placement to identify opportunities for improvement.
There are many variables to consider when building a cross-platform advertising strategy. The optimal mix will be different for every brand and may change on a quarterly or even monthly basis. Brands need to evaluate performance on retail websites and brick & mortar stores both separately and together to understand how actions on one channel can impact the other. Consideration should be given to the impact of price matching, out of stocks, and if growth in one platform is a redirection of consumers from another point of purchase.
Analyze your retail readiness and the competitive landscape to determine the best strategy to achieve your goals for each retailer. When limited data exists conduct pilots and decide where to increase investments after early success has been identified. In some instances, the best decision may be to double down on advertising, while in others it may be best to pause advertising and focus on retail readiness to provide a great customer experience.