New Advertising Opportunities
CitrusAd has teamed up with Target to offer new advertising opportunities for brands selling on the retailer’s online platform.
What do you need to know if you’re an Amazon or Walmart seller who may be considering expanding to other retailers?
We recently held a webinar with Andrew Waber, Director of Insights at Teikametrics, and Dana Concepcion, SVP of Media Sales at CitrusAd, to detail how advertising will work on Target.
The upshot? There’s an incredible opportunity for expansion and growth through Target if you tackle that opportunity with the right strategy.
Ad Types on Target
The ad types being offered on the Target site have a lot in common with Amazon and Walmart. There are sponsored product ad units as well as more media-rich display-type ads in the offering.
Ads can appear in three types of places in the Target shopping experience, similar to placements for other retailers:
- Search results pages
- Category/browse pages
- Product detail pages
Targeting Opportunities on Target
Bid targeting happens at the keyword, SKU, and category level. As Dana explained, “Our platform does allow you to optimize on an individual keyword level, meaning that you can have a strategy for each individual keyword that relates to your products.”
Dana emphasized the importance of the ability to bid on competitor keywords. This practice gives new brands, or even established brands with new products, the opportunity to reach in-market customers and potentially steal away sales from a competitor.
She went on to add, “You can also have strategies to bid on individual SKUs… You can also bid on a category level as well. So you do have more options with the CitrusAd platform to be more strategic.”
The Power Of In-Aisle Ads
Dana emphasized the power of display ads within a shopping site to reach shoppers with high intent and a purchase-oriented mindset.
“Whether they’re searching for products or browsing the aisles, you’ve basically got them at a very low funnel point of purchase,” Dana explained.
“So this is why display media, within the retailer environment, you could say it’s a little bit more upper-funnel but it’s still very performance-based because…it is all onsite and they’re doing their shopping already.”
It’s not just theory. These ads have been demonstrated to work.
These Ads Work
Dana shared data that shows how powerful these ads can be, especially in the context where advertising is relatively new to the site. Brands that are already using CitrusAd are seeing increased conversion rates and strong ROAS.
- The average Target product ad conversion rate is 62%
- Year-over-year the average Target product ad conversion rate increased by 34%
- The average Target product ad ROAS is $3-4
These ads are so effective because they work with the understanding that shoppers are most likely to purchase from results at the top of search.
“You have the ability with these ads to basically get to the top of search on some key terms and convert,” according to Andrew.
“What we know, consistently across Amazon and Walmart, is that users trust these sites to put relevant products in front of them at the top of search.”
That’s a universal truth across these retailers, but there are also critical differences sellers should keep in mind.
Target Differs From Amazon and Walmart
When expanding to a new channel there’s much valuable learning that can be taken from one marketplace and applied to another. For example, the best keywords on Amazon are worth testing in ads on Target to discover how well they perform in the new environment.
However, it’s also important to have a nuanced understanding of the differences between each of the sites to give yourself the best chances for success.
Andrew identified three important points of comparison between Target and the more familiar sites:
- Auction type
- API connection
- Brand-retailer relationship
“There are some differences, and Target is not the same right now as Amazon and Walmart,” said Andrew.
First of all, Target’s ads operate on a first-price auction, which is like Walmart but unlike Amazon. Advertisers need to take this into account when developing a bidding strategy that will be cost-effective.
Second, Target currently has no API connection. That type of connection makes it possible for Teikametrics to automate bidding on Walmart and Amazon. Without it, near-real-time bidding action is not possible.
Finally, Target’s ad product is really for 1P vendors currently, but, Andrew advised, “If you’re a 3P seller, keep in mind those options are definitely going to be coming.”
Early Movers On Target Gain An Advantage
Dana and Andrew both agreed that the early bird gets the worm, or in this case, the early adopter of the Target marketplace and its advertising capabilities gets an advantage over the competition.
Andrew has watched this happen for sellers who moved quickly on the Walmart opportunity as it launched its advertising products.
The key is seizing the opportunity on Target, but the business insight is also about the strength and resilience that comes from diversifying your business and where shoppers can find your products.
“It’s going to put you in a better position, two, three, four years from now, as things continue to grow because all that growth will not just be situated on Amazon and Walmart. It’s blooming out to these other platforms,” Andrew pointed out.
“You’re reducing risk and it gives you a whole new channel, potentially a whole new group of consumers that you’re reaching with your products. So it’s definitely something to look into.”
Is It Time For You To Expand To Target?
Determining whether and when to expand to a new sales channel can be a big decision. As you consider adding Target to your business plan, be sure you’re asking all the right questions.
Andrew suggests gathering answers to each of these strategic considerations before making the leap to a new channel – Target or otherwise:
- Do you have the inventory on hand to expand to new channels?
- What parts of your inventory are you able to move to new channels?
- Is there significant demand by your customer base at a given retailer?
- Do you meet the qualification criteria for the new retailer, or if not, what do you need to do to meet them?
- For advertising, what are your goals, and do you have the assets needed?
You can also lean on trusted strategic advisors at Teikametrics and CitrusAd to help you to understand your unique opportunity and your best approach to test a newer retail ad platform like Target’s.
What’s Next For Target
This is only the beginning of the partnership between Target and CitrusAd. We anticipate that we’ll continue to see innovation and growth there.
As Andrew said while wrapping up the webinar, “ Keep your eyes open because there’s definitely more coming from Target.”