Should Online Retailers Take on Publishers?

By Rob Yoegel

December 16, 2011

A few weeks ago, I wrote a post about the convergence of retail and publishing and how media brands are hoping to replace lost advertising revenue by getting in on some ecommerce action.

So when you see established media brands creeping onto your turf, one reaction is to try and further monetize your own website traffic by using some page real estate for display advertising. Before accepting advertising for your homepage, product pages or anywhere on your website, there's some basic information you should know that will help you decide if getting into the advertising business is for you.

Ad sizes are commonly known as interactive marketing units (IMUs). While your product images, hero graphics, headers and badges may all vary in size, IMU sizes are set by one of two organizations: the Interactive Advertising Bureau (IAB) or the Online Publishers Association (OPA). You'll need to make sure that your page real estate can accommodate things like leaderboards, wide skyscrapers, fixed panels and pushdowns before accepting the first ad on your website.

Direct ad buys typically require a large amount of ad impressions. It won't matter if the advertiser is a small startup or the largest consumer package goods company, they'll pay for advertising on your website based on impressions or clicks—and you'll need to provide a lot of them to earn enough to buy anything more than lunch for your staff a few times a month.

Another option would be to participate in an ad network, which is when a company sells available ad inventory on your website by combining it with advertising from other websites often similar to yours. Ad network buys are done "blind," meaning companies that participate in them are not guaranteed to have their ads appear on any specific website within the network. For this flexibility, they pay lower rates compared to purchasing advertising directly from you.

Then there are the dozens of ad servers created to assure accurate delivery and reporting by dealing with concerns like caching and click fraud. Ad servers will require you to put a few lines of JavaScript on your website within the page <body> tag to serve the IMUs. If you're running ad network inventory, you have to closely monitor the advertisers and creatives that appear to keep competition and teeth whitening or erectile dysfunction offers from making their way onto your pages. And if you're planning on selling advertising directly, you'll need to choose your own ad serving technology that will come with a learning curve and additional costs.

What I've discussed to this point are the very basics. I haven't even scratched the surface when it comes to understanding what's happening today in the multi-billion dollar world of Internet advertising, especially when you consider newer opportunities like ad exchanges and real-time bidding. As you can surmise, effectively running display ads on your website gets quite complicated.

One of your most important metrics is to increase conversions, to turn a website visitor into a customer. I don't buy into the idea that stagnant conversion rates is an excuse to reinvent yourself as a media company. After spending more than a decade building a publisher's online advertising business, I can tell you firsthand that regardless of how much traffic you're getting, building an online ad business is not a simple process.

Many of you participate in retargeting programs, hoping to re-engage visitors who left your website without making a purchase while they surf another website and see your ad. There are a lot of companies that can help you with retargeting, but where they fall short is helping you convert the returning visitor into a customer.

Focus your attention on echoing the messages and offers in the ad creative of your retargeting campaigns on your website for return visitors. Offer them a discount on the product they viewed or left in their cart during a prior visit.

Your retargeting vendor may also discuss with you the opportunity to make some additional money by helping them build their audience with non-personal identifying data that will require a third-party cookie on your website. For a few extra dollars, this could be a turnoff to your more savvy visitors.

I would love to hear from any retailer that has increased conversion rates after they started putting advertisements on their website. I suspect more media brands will continue to get involved in ecommerce. At least to me, it doesn't seem to make sense the other way around.

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