There is much tension on this off-site inventory because sophisticated brand advertisers often have targeting segments of their own that can predict purchases in addition to the retailer’s data. But the reporting and the strategic relationship with the retailer are what ultimately drive audience extension media buys.
Four investments to improve performance
What if audience extension ads were funded by brand dollars, with perception-focused KPIs rather than direct response ones? Even if that retailer dream became reality, it’s still hard to make a compelling case for a brand advertiser to justify the RMN markup on audience extension inventory.
The only way to resolve this tension is to improve the performance of RMN audience extension inventory such that the RMN markup is justified. There are four ways to do so:
- Better data: Append more attributes to what a retailer knows about their customer to build audience segments that are more likely to buy the advertised product. This requires clean rooms, data enrichment, data science, and machine learning to do it right.
- Better inventory: Run audience extension ads in more contextually relevant locations with commercial intent where impressions trigger a purchase.
- Better measurement: The dirty truth is that most claimed conversions from on-site RMN impressions would have happened anyway. Filtering for incremental sales rewards ad impressions that create demand and don’t just harvest it.
- Better creative: On-site impressions need to trigger an add-to-basket. Off-site audience extension impressions also need to trigger a shopping trip. Today’s “Available at Retailer X” tags in creative do not stimulate trips. Creative that speaks to why a customer shops at a specific retailer, as well as why they would buy a particular product, work better.
We still have much work to do to make audience extension inventory perform to the level that earns the amount of revenue retailers depend on. For retailers that can’t build a scaled media footprint of their own, investments in measurement, creative, inventory, and data will help create a more attractive scaled option for brand advertisers.