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Why So Many Retail Advertisers Are Leaving Revenue On The Table

Written by: Juliana Casale, Director of Marketing

Digital marketing managers who specialize in retail have a tall order – not only to grow revenue through user acquisition, but also drive repeat purchases from current customers. This can be a difficult task to accomplish, for several reasons:

1. Top of the Funnel Focus

The retail industry has traditionally focused on branding metrics like impressions and clicks, rather than downstream actions like signups and add to carts, which provide more valuable opportunities for revenue. Further down the line, not tracking or optimizing for the lifetime value of customers (not just what they bought immediately after seeing your ad, but if they returned to your site or app weeks or months later) can cause serious harm.

Retail advertising transparency

Oversights like this aren’t just bad for your company’s bottom line; they also provide more leeway for your competitors to lure away your most valuable customers by bidding more aggressively for their attention. After all, if you knew someone had the tendency to be a repeat purchaser with high everage order value, wouldn’t you spend more to keep getting in front of them?

2. Agency Legacy

In addition, more established retail brands often have a long history of outsourcing advertising functions to agencies, who typically don’t provide transparency into the true cost of media buys, targeting decisions, or the results of campaigns.

Screen Shot 2016-07-29 at 1.16.46 PM

Of course, it’s impossible to understand the performance of your ad spend when all the data is in a black box — which means the likelihood that you are underpaying for high-value customers or overpaying for those who won’t convert is high. And it’s equally difficult to understand what resonates with your audience when your audience is one layer removed from you. Without a direct feedback loop, decisions on creative strategy become guesswork rather than data-driven.

3. Fragmented Attribution

A siloed approach to advertising is the final nail in the coffin.We all know that the customer journey has split off into many combinations involving desktop, web, apps, in-store, and direct mail. Not being able to track touchpoints across this spectrum leads to — you guessed it — uninformed digital marketing spend. If you can’t attribute value across devices and in-store, at every stage of the buying process, how can you expect to scale a global customer base?

Retail advertising attribution

When you factor in disconnected acquisition and retargeting campaigns across mobile and social channels, the picture gets even more messy. 

Does all of this sound uncomfortably familiar? Don’t despair. Retailers who make a commitment to direct response and in-house advertising can get back on track with accomplishing acquisition and retention goals, since having access and control of real-time, first-party data is the key to bidding and budgeting effectively. Equipped with the right automation tools, wasted ad spend and lack of control goes out the window. A recent analysis from Technology Business Research reveals, “As digital advertising formats capture an increasingly larger proportion of global ad spend, the infrastructure, intelligence and ROI ad tech platforms deliver become strategic pillars for brands.”

If you’re ready to seize control of your retail advertising and scale revenue, check out our software guide:


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