Latest / Retail Media Breakfast Club / How an RMN's tech stack impacts your advertising results
Transcript
- why the RMN tech stack matters to advertisers === [00:00:00] Recently I've been considering switching newsletter, hosting platforms, and there's a whole host of considerations here, like discovery, for example, Substack and Kit. Emphasize these recommendations from each creator, which could potentially help to grow my audience. Another consideration is the native SEO strengths of the provider, ease of use, and the ability to run native ads in the future. [00:00:27] And these are all things that could help me as the author. Of my newsletter, but what are the factors that matter for my audience? A big one is deliverability. Does this new platform make it more or less likely for my emails to hit the spam filters? Any one newsletter platform, whether I'm looking at Kit Substack. [00:00:49] Beehive, et cetera, seems to have strengths and weaknesses against all of these criteria, and what's good for me might not be the best for the audience and vice [00:01:00] versa. These same complex trade-offs occur in commercial settings, ~which ~with much higher stakes [00:01:07] Consider the choices that retailers make around the technology stack that powers their media networks. Once upon a time, there was just one credible option. Criteo Criteo was the butcher, baker and candlestick maker of the RMN Tech stack. It did everything a retailer needed in a plug and play kind of model. [00:01:31] But there's been an explosion in retail media tech in recent years. Startup tech solutions, zero in on one capability in the value chain and optimize the heck out of it. D-S-P-S-S-P ad server, OMS tech layers. That bridge, these different components, they all go after one capability and try and do it the best out of anyone, Inevitably, these upstarts start [00:02:00] looking for more opportunities up and down the value chain as well. [00:02:03] They're competing with the incumbents, not only on features, but also on pricing and terms. This means more choice than ever before. When retailers look to build or update their tech stacks, and that's great for competition, each retailer can now craft a truly unique selling proposition for prospective advertisers. [00:02:27] There's no reason for retailer A RMN to look, perform, and cost exactly the same ~as retailer BRMN ~as retailer B'S RMN anymore. But this also means that brands and advertisers need to be educated about what they're buying. Retailer, A Franken stack may significantly underperform retailer B'S modular approach using best in class tools. [00:02:55] So ~advertisers have ~advertisers have both a right and a [00:03:00] duty to understand how these RMNs are built and how that structure impacts their performance. [00:03:07] In today's episode, I'm going to break down why brands should care about RM and Tech Stacks, and a few of the questions to ask your retail partners as you're looking to onboard with them. I will point out this. Episode is based off a blog post that's live on my blog today, which has a lot more detail on the questions here. [00:03:30] There's actually 10 questions that I suggest, and there's a really handy map of the whole ecosystem of retail media, which I built myself 'cause I. Just didn't understand how all the pieces kind of fit together. And I created this map just to help get it into my head. So if like me, you're sort of new to this space, or you want to understand the different component plays a little bit better, highly recommend checking out that map. [00:03:58] [00:04:01] All right. Amazon and Walmart command, roughly three quarters of retail media spend with their vertically integrated platforms. When buying media on these networks, everything is kind of seamless. Amazon, for example, is the front end. They are also the ad server. They are also the reporting system that goes back to the advertiser. [00:04:23] Simple.~ Simple.~ [00:04:24] Brands looking to expand into other retail media networks need to understand. The basics of an RMN tech stack because the technology fundamentally determines campaign outcomes in several critical ways. [00:04:39] are just three examples. One is ad server load time. This significantly impacts user experience and as a result, ad effectiveness, shoppers get frustrated when ads don't load properly or at the same time as organic search results. [00:04:59] ~Shoppers get frustrated. They don't click on your ads.~ [00:04:59] Irrelevant [00:05:00] ads might show up and ~you know, it's, ~it's a bad experience overall. Slow loading ad servers can increase bounce rates and reduce click-through rates and conversions. Amazon themselves studied this back in 2006 and found that with just a 100. Millisecond delay, that's just one 10th of a second. [00:05:21] That could reduce conversion rates down 1%. And if we're talking about conversion rates of, ~you know, ~two to 5% on a website, that is a really significant drop. Another way that this technology can impact advertisers [00:05:37] Is in workflow costs. ~This is not included in your ad performance metrics, but it is, ~this is not gonna be obvious in your ad performance metrics, but the cost to manage and report on your retail media stent is a real cost. User interfaces really do matter ~Those. ~Do we have realtime reporting? Do we have a dashboard? [00:05:55] Do we have reconciled line items? In a past article [00:06:00] for Forbes, I spoke with Alex Arnett from Dentsu Newstream Media, and he shared with me how some RMNs still send performance reports by email to advertisers. ~That is not,~ [00:06:12] that is not how we wanna be making decisions around budget allocation. [00:06:17] Likewise, home Depot's. Melanie Babcock told me that their media arm had two separate systems for offsite and onsite advertising, and it was not a great advertiser experience. So last year they brought in tech that unified the ad buying experience, making it possible for advertisers to manage offsite and onsite media together. [00:06:41] This productivity from better reporting interfaces also belongs in this media ROI conversation, even if it never shows up specifically on the campaign dashboard. [00:06:52] So I do recommend, as I said, checking out this diagram of the way that a retail [00:07:00] media. Ecosystem is built both for offsite, onsite, and sponsored placements. They all have sort of a different workflow and different component technology. So if you have a base level understanding of those different pieces, this is where you can get to very specific questions to your retail media partners To find out more about their technical infrastructure and how that might affect your ad performance. So I've got 10 questions on the blog today. I'm not gonna go through all 10 over the podcast. I'll do two perhaps and um, link up to the full article in the show notes. [00:07:40] [00:07:42] So one question is, what's your site's load time for organic versus paid placements, and how do you mitigate any page speed impact? So this is gonna tell you, you know, to. Are these two systems, the ad serving and the organic, um, search results? [00:08:00] Is there some kind of cohesion here? Are they showing up in a way that is not gonna be frustrating to customers? [00:08:07] ~Um, ~faster pages keep people browsing and buying it means more relevant ad results as well. When this is not optimized properly, it's going to really hurt your ad conversion rate. Another question is, what reporting APIs, dashboards, or CSV exports do you offer and can we get real time placement level performance data? [00:08:29] So this is really important because as a media buyer, you wanna spot under performers immediately and move budget to winning tactics. Getting an emailed report every week or two is not an acceptable way to run a modern retail me media buying operation. You wanna be able to see stats by product, placement, creative, and audience as well, so that you can more effectively manage your ad budget. [00:08:58] And another one is what [00:09:00] share of ad inventory is reserved for managed service deals. Versus self-serve programmatic buys. And this is important because a lot of retailers will have sort of a VIP lane for their largest advertisers and all of that ad budget and inventory is managed through a direct sales team. [00:09:21] So this is gonna tell you if prime spots are taken by big brand contracts before you bid, ~and it's gonna have. ~And it will have an impact on what price you pay for ad placements as well. Is the ad auction truly competitive? So something very important to understand [00:09:41] how this allocation is differentiated [00:09:44] [00:09:47] As retail media evolves beyond the two big players, technology infrastructure will increasingly determine winners and losers. Retailers who invest in superior technology stacks offering [00:10:00] better performance, more transparency, and advanced optimization capabilities, ~we'll ~be able to attract more advertiser dollars despite the proliferation of options in the market. [00:10:12] and the brands that understand these technical nuances can make smarter investment decisions and build more effective retail media strategies.