The ‘Ecommerce’ Category
Earlier this week, OwnerIQ announced the acquisiton of "on-demand shopper marketing technology platform DiJiPOP in an all-stock deal." (Also, read DiJiPOP Q&A on AdExchanger from March 2011) Shopper marketing online is increasingly an attractive opportunity to explore for retailers. According to the press release, "The deal enables OwnerIQ to increase the value and revenue potential for the online retailer and manufacturer partners that power their unique Ownership Targeting capability." Read the release.
CEO Jay Habegger answered questions on the acquisition and its impact on OwnerIQ.
AdExchanger.com: What was the trigger for the transaction? Is this about tech or clients?
In the ad tech marketplace OwnerIQ is known for ownership targeting, an advertising solution that enables marketers to target online consumers based on the products and brands they own or intend to buy. This capability is powered by OwnerIQ’s Media Solutions, or OMS, which has relationships with online retailers, manufacturers and publishers for whom we enable marketing capabilities, such as co-operative audience sharing, and provide ad revenue in exchange for consumer browsing and purchasing data. The acquisition of DiJiPOP, an on-demand shopper marketing technology platform, will add even more value to our OMS relationships and enable our partners to generate new revenue through on-site display advertising and product placements.
Is shopper marketing becoming more of a focus for OwnerIQ?
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Jonathan Opdyke is CEO of HookLogic, an eCommerce media company.
Opdyke provided an update on HookLogic's business following the announcement of the hiring of Jeff Griffin as the company's President of Retail. Read the release.
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AdExchanger.com: What are you seeing currently from e‑commerce retailers and their willingness to get into the data game of advertising?
JO: First, it's the same monetization opportunity that publishers work on every day. Retailers are basically joining in on the publishing game.
In terms of what we see, about a year and a half ago, it was an interesting idea to many ecommerce retailers, but it wasn't a priority. And, it was something that retailers feared - and for good reasons. The primary business model for retailers is to sell products. Anything that potentially gets in the way of selling products is going to be looked at with trepidation. On the other hand, if you do it right, if it's contextual and relevant, it may not even look like advertising.
What retailers are seeing is that what we do complements a number of factors. For one, there are a number of us out there that are proving that media within a retail environment is acceptable. We are a good analog to media placements in physical stores - online has actually been pretty late in that game.
The second thing is profitability. Some retailers make large margins, but most retailers are running on thin margins. When you consider adding media to a retail website, it can add a significant amount to the bottom line and reflect the total value of the site’s audience.
When you look at the conversion rate of an e‑commerce site and recognize how many people are visiting it, but some consumers are using it only as a research vehicle, you recognize that, like it or not, retailers are publishers. With [HookLogic’s] hire of Jeff Griffin and his work on the Zero Moment of Truth Initiative, it's a testament to why we exist.
Retail sites sit at the confluence of the Zero Moment of Truth and the First Moment of Truth. The First Moment of Truth is the shelf - an online retailer is a shelf. People are looking at products with an opportunity to buy right then.
But, online retailers are also at the Zero Moment of Truth where so many people are using online retailers as research vehicles before making their purchase decisions. Consumers then may go into a store, or to another site in order to buy.
A lot of things are happening in the industry right now that are pointing in the direction of being closer to shoppers and their decision points.
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Yesterday, online shopper marketing company RichRelevance announced the acquisition of retailer search monetization provider Searchandise. According to the release, "RichRelevance currently serves more than 1.4 billion page views each month across its retail publishers and with the acquisition of Searchandise will now serve 10 of the 25 largest retailers on the web, including Target, Sears and others." Read more.
Yesterday, Diane Kegley, CMO of RichRelevance, discussed the transaction and its implications.
AdExchanger.com: 3M's Raj Roa told Ad Age that buying banners on retailers sites was not effective, compared to the RichRelevance advertising platform. Does that mean that RichRelevance does not plan on offering standard banners for retailers?
DK: Since our ad server is built upon personalization software, the RichPlacement unit as well as the banners we serve tend to out-perform the market because of the relevance to the context of the consumer. Most ad servers are built to serve ads across the broader web across multiple types of content sites, whereas our ad server is built strictly for retail, and that distinction is critical when it comes to campaign performance. The ad unit of choice for a given brand varies widely. Some brands prefer integrating their brands directly within our product-recommendation technology, and some prefer banners for ease of buying at scale. For those that do prefer standard banners. There are plenty of brands that we work with that see above industry average performance with banners on our retail partner sites.
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Richard Harris is Co-Founder and CEO of Intent Media, an online ad platform for ecommerce publishers.
AdExchanger.com: First, can you share a little bit about your background and how you arrived at deciding to launch Intent Media?
RH: My background is - having been a retailer for a long time - I was part of the founding team of Site 59, which was in the online travel space. We sold that company to Travelocity in '02. And I have two co‑founders here who worked with me both at Site 59 and at Travelocity where we focused on merchandising, conversion and our transaction metrics for a very long time. And we focused on being good retailers.
We realized that retailers were sitting on this huge media asset, which they weren't exploiting to its full potential. So we really are not ad guys. We're fundamentally retail guys. We hired a lot of media experts..
So our DNA is retail. Our insight is about the media value inside of retail sites, and that was sort of the genesis of the firm.
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Amit Kumar is CEO of Lexity (formerly known as "Vurve"). In a press release last week, in addition to its name change, the company launched its "'Ad Intent' system for e-commerce merchants of all sizes." Read the release.
AdExchanger.com: So, what was the original idea Vurve? And then what did you learn along the way that revealed Lexity, if you will?
AK: Our initial vision was to build a simple, affordable and effective advertising solution for e‑commerce small businesses - that has remained the same over time. But what we learned in the last couple of years was that small businesses are confounded by the complexity that exists in the ecosystem. For example, if you are a small e‑commerce business, you open up Google and find a lot of tools, and you have to understand the system quite a bit to actually do any effective marketing at all.
We learned over the last couple of years that for e‑commerce merchants, two things are important. First, the fundamentals were more around marketing terminology. Clients thought, "OK, I want to create awareness for my brand.” And so, instead of hitting the merchants on their head with the technology, what we should have been doing is talking to them in the language that they understand.
Secondly, at my previous job where I was VP of products at Dapper (acquired by Yahoo), we were essentially building a DSP, but only focused on display media like every other DSP out there.
So another reason I started Vurve, now Lexity, is because I strongly feel that there is a demand for looking at demand-side algorithms going across all channels.
Another way to think about it is - it's almost an iOS approach, where we're saying that as an e‑commerce merchant, you can come in and say, "I want to increase conversions” and our OS will do the rest.
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Josh McFarland is CEO of TellApart, an online media buying and data management platform, discussed recent events at his company and his view on digital ads.
The company recently raised a $13 million round of funding through Greylock and Bain Capital (read more).
AdExchanger.com: Since we last spoke a year ago, are there any new trends you can share regarding the digital marketing strategies you're seeing from e-commerce retailers?
JM: The biggest and most telling trend is that retailers who have an online presence – both pure-play and multi-channel -- are starting to really understand and appreciate the valuable asset they have in their own customer data and what it can do for them. We’re starting to field much more thoughtful questions from retailers who want to build customer data systems to support their display ad efforts.
The second trend is that these retailers continue to get smarter about their online marketing strategies. They know their ROI metrics down to the penny, and they’re seeing that customer data-driven retargeting makes display ads finally work. I’d say retargeting in general is on the cusp of being a must-buy for most retailers.
Any adjustments in your company's strategy in the past year?
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Yesterday, eBay announced the acquisition of eCommerce fulfillment and marketing tech company, GSI Commerce for $2.4 billion. Read more.
AdExchanger.com asked the following members of the ad ecosystem:
"What is your take on the acquisition of GSI Commerce by eBay?"
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Jake Bailey, Chief Evangelist , Rich Relevance
Net-net, we think this is a powerful attempt by eBay to compete with some of Amazon's strengths...
- 1) Non-Auction selling: eBay has historically had trouble managing and selling large catalogues of structured merchandise (I.e., SKU-level with inventory vs. one-off items), so this will be a nice win in this respect. In other words, this aligns well with their push to selling more fixed-price products to consumers (non-auction).
- 2) Fulfillment: Amazon has been very successful in offering fulfillment for some of their sellers. One of GSI's key strengths is in their logistics and fulfillment capabilities.
- A competitive question: Along these lines, this move may also be perceived a threat to existing GSI clients. They may not want to "become a fulfillment partner for eBay" because eBay is already heavily competitive in some of GSI's key categories such as Toys and Sporting Goods."
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With $2.4 billion in cash and debt, Ebay clearly stated that they intend to be the player in e-Commerce as they acquired GSI Commerce on Monday.
GSI Commerce shareholders are ecstatic. Their stock is worth 50% more than it was on Sunday.
From the release, the company states that the "acquisition enhances eBay’s position as the strategic global commerce partner of choice for retailers and brands of all sizes." In other words, anybody with a store front could be/should be an eBay customer. Amazon will surely continue to have something to say about this, let alone others such as Google which is just beginning to reveal its e-Commerce strategy.
Swirling with the acquisition is the all-important, first-party data that every e-Commerce site has if they choose to use it - everything from email addresses to browser cookies.
Though the transaction won't close till the third quarter of 2011, one can imagine that the technology and data strategies of the companies will begin to integrate immediately. This means that recent acquisitions by GSI Commerce such as Clearsaleing and Fetchback will begin pointing at larger eBay initiatives. The recent pullback from the intent data business makes even more sense today as the eCommerce giant looks to leverage its own data and capabilities across its entire eCommerce enterprise.
eBay spokesperson Johnna Hoff echoed the press release saying the following regarding the strategic implications of the acquisition:
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Ji Kim is Founder & CEO of DiJiPOP, a digital shopper marketing company.
AdExchanger.com: What problem is DiJiPOP solving? And, please define "digital shelf space."
JK:We help retailers and brands better merchandise and increase sales by applying in-store shopper marketing practices to their online and mobile stores- where consumer go first when they start shopping.
We are fixing the marketing spend for retailers and their vendor partners. 75% of all shoppers start at retail web sites, yet very few dollars are allocated to these digital shelves. For retailers offering these solutions, we give them the tools to scale these programs through automation.
We define digital shelf space as the real estate on any retailer published information that’s viewed on a digital display or web connected device. Like shelf space in the physical store, the web allows us to automate and manipulate what we push to these digital shelves and how we present it – in real time with the ability to track and optimize based on sales.
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