Brand Advertising Fattens Margins for Big E-tailers - Olympia Portale

Retailers selling products online are turning to increased advertising as an additional revenue stream to help bolster margins. An AdAge.com article entitled "Brand Advertising in Programmatic Era Fattens Margins for Big E-tailers" (http://adage.com/article/agency-news/dbrand-advertising-fattens-margins-big-e-tailers/301281/) describes the problems publishers are facing, including ad fraud, ad blockers, and a saturated marketplace.  Additionally, e-commerce sales have notoriously thin margins. However, e-commerce sites are luring product advertisers by making their first-party data about consumers more readily available. Advertising margins on e-commerce sites can be as high as 70%; therefore, it's a no brainer for e-tailers to sell ads for products that they themselves sell.

For example, Amazon has its own private ad exchange, which adds significantly to the company's non-operating revenue and impacts the bottoms line. The trend of e-commerce sites operating more and more like publishers is continuing to grow. Investment in understanding consumers' path to purchase and engaging in strategic partnerships that make better use of user data will enable both e-tailers and advertisers to deliver more relevant and engaging ad content to users in the programmatic era.

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