Introduction:
On the "The MarTech Matrix" podcast, Greg Stellato, co-founder of M3, discussed the significant challenges facing specialty retailers and advertisers and how M3’s solutions address these issues. Hosted by Sean Simon, the episode offers valuable insights into the evolving landscape of retail and advertising.
Retailers' Struggles:
"Retail margins are thin, conversion rates are low, and traffic acquisition is high," Greg explained. These factors hinder profitability and growth, pushing retailers to seek alternative revenue sources.
Advertisers' Dilemma:
Advertisers face a cluttered and often ineffective advertising landscape. Consumers experience ad fatigue and ad blindness, training themselves to ignore repetitive and intrusive ads. This makes it harder for advertisers to create meaningful connections with their target audiences. "It’s a race to the bottom for cheap reach, and there aren’t many premium opportunities left," Greg noted.
Using Retailers as a Proxy for Context:
M3 uses specialty retailers as a proxy for context, providing advertisers with access to engaged, dedicated audiences in trusted environments. "We're using these retailers as a proxy for context, offering premium, brand-safe spaces," Greg explained. This allows advertisers to place their brands in front of dedicated customers, ensuring higher visibility and impact.
Eliminating Common Ad Issues:
M3 offers a premium advertising experience with no auto-refresh ads and 100% share of voice. By trading brand equity with established retailers, advertisers benefit from the trust and loyalty these retailers have built with their customers. "Advertisers get a brand-safe, premium experience," Greg noted.
Conclusion:
M3 helps specialty retailers find new revenue opportunities, supporting their growth and sustainability, while giving advertisers access to valuable, dedicated audiences in trusted environments. This approach not only helps businesses survive in tough times but also thrive and reinvest in their growth.
Listen to the Full Discussion:
For more insights, listen to Greg Stellato on the "The MarTech Matrix" podcast, hosted by Sean Simon.
Listen on Apple Podcasts
Listen on Spotify | Watch on YouTube
E-commerce has opened up incredible opportunities for retailers to directly reach customers. However, alongside the benefits, challenges arise, most notably the low conversion rates.
Typically, only about 2% of web traffic converts into purchases. This begs the question: What about the other 98% who browse but don't buy? They represent a significant investment in marketing, site development, hosting, and more—investment that, traditionally, hasn't been monetized by retailers.
At M3—short for "Make Merchants Money"—we see this as a substantial missed opportunity. Co-founder Michael Cassidy shared the philosophy behind our name and approach:
We intentionally started with the name M3 because it felt very authentic. It felt a little cheeky and put a stake in the ground—we have conviction on this idea, and it's really about monetization for retailers.
M3 is pioneering a new monetization channel specifically for e-commerce retailers to tap into the 98% of traffic that doesn’t convert—by facilitating brand advertising and sponsorships on their sites. During a recent episode of the Taking Inventory podcast, Michael elaborated on the rationale behind focusing on this often overlooked segment:
The data I keep going back to is that the average e-commerce conversion rate is 2%. Focus on the 98% who don't buy a thing, who don't put a dollar in your pocket. Yet, you spend money, time, and effort getting them there and keeping them there. You have to monetize that investment.
Podcast host James highlighted the parallel between our model and successful strategies used by mobile app developers:
This more than anything reminds me of just mobile app developers, something that they've known for years—if you're going to pay to get people to download your app, only a very small percent are going to convert to purchase something. The rest have to be subsidized through advertising.
Consider the scenario of shopping for luggage on sites like Tumi or Samsonite; you are likely a traveler. Airlines, hotels, rental car companies, and more would jump at the opportunity to place brand messages in front of this qualified audience. This potential extends across all e-commerce verticals. Michael Cassidy noted the timely relevance of M3's model:
This isn't a novel idea, but it's an idea that's prime for this point in time with inflation, COVID pulling sales forward, rising ad costs, Amazon's marketplace dominance, and overall pressures on being a retailer.
By unlocking this new revenue channel, M3 empowers retailers to convert window shoppers into a lucrative revenue stream. We package this offering as a premium, high-touch branded solution rather than direct response ads, ensuring a seamless integration that respects the retailer's environment and enhances the shopper's experience.
Michael Cassidy's successful track record and the positive reception from retailers signal a promising horizon for M3. As podcast co-host Daniel remarked:
This is your third act, Mike, and the first two went pretty well, so it's a little hard to bet against you at this point.
We're excited to help this vision become a reality for e-commerce retailers.
Listen to the Full Podcast
Want to hear more insights from Michael on the genesis of M3 and the future of brand commerce? Check out the full episode of the Taking Inventory podcast:
Introduction:
In an episode of the "Marketecture" podcast, M3's CEO Mike Cassidy discussed the challenges retailers face and how M3 offers new solutions. Hosted by Ari Papparo and Eric Franchi, the episode provides valuable insights into the retail industry and digital media along with their hottakes on the Walmart-Vizio acquistion.
The Retail Challenge:
Retailers are under pressure from several fronts, including competition from giants like Amazon, rising customer acquisition costs, and changing consumer behavior. Mike Cassidy highlighted these issues, stating the need for alternative revenue sources for retailers to stay afloat and thrive.
M3's Mission:
M3 aims to introduce an additional revenue stream for retailers. "There's another revenue stream for retailers. There's another way for these companies to make money," Mike Cassidy explained. This approach helps retailers leverage their existing assets - their audience, brand, and digital presence - beyond just selling products.
Beyond Traditional Sales:
Cassidy pointed out that while big players like Amazon and Walmart benefit from retail media, smaller retailers and merchants often miss out. M3 addresses this gap by enabling these businesses to earn from non-endemic advertising, turning their online spaces into profitable platforms.
Conclusion:
M3 is on a mission to help retailers navigate the digital market's complexities by providing them with a new way to generate revenue. This initiative not only helps businesses survive in tough times but also thrive and reinvest in their growth.
Listen to the Full Discussion:
For a deeper understanding of how M3 is changing the retail landscape, listen to Mike Cassidy's discussion on the "Marketecture" podcast, hosted by Ari Papparo and Eric Franchi.
Picture a distinguished luggage merchant celebrated for its premium products and unmistakable brand identity. Despite its solid standing, fierce competition from industry titans like Amazon chips away at their profits. The merchant experiments with drop-shipping and marketplace models, only to find that the clutter outweighs the financial gains. Then comes the game-changing M3 solution.
M3 leverages commerce platforms and consumer touchpoints to offer advertising opportunities. It transforms digital and physical real estate into a revenue powerhouse, seamlessly enabling brands to advertise in commerce. Now, merchants will be able to monetize the 98 percent of customers who aren't transacting.
Understanding the Audience
While searching for luggage, these customers will also have a deep affinity for travel-related and lifestyle services. Relevant messages will not be seen as intrusive; they will be embraced as valuable offerings.
Inviting Relevant Advertisers
With M3, the merchant will warmly invite select, non-competitive brands. The goal won't be to overwhelm customers but to provide them with pertinent, complementary offers and information. The merchant will maintain complete control, ensuring a curated experience.
Minimal Investment, Maximum Returns
Implementing M3 is straightforward and requires minimal effort from the merchant's technology and product teams. By seamlessly integrating advertising and sponsorship across their digital platforms and forging strategic partnerships with brands aligned with their audience's interests, the merchant will rapidly tap into a highly profitable revenue stream with minimal investment.
Refinement Over Time
Through constant feedback loops, the merchant and M3 will collaboratively hone the strategy. This iterative approach will enable them to maximize their advertising potential. They will consistently discover new platforms and placements, ensuring a reliable and ever-expanding source of incremental revenue.
In the face of relentless competition and an unwavering pursuit of innovation, the luggage merchant's embrace of the M3 strategy will not only provide a buffer against market pressures but also establish a sustainable, continuously growing revenue model.
The ensuing profits can be allocated to product development or digital marketing expense reduction, whichever is considered critical for the merchant.
Client: Leading Auto Manufacturer (LAM)
In a truck market saturated with claims of superior towing capacity and raw power, LAM faces the challenge of differentiating their new truck within a highly competitive landscape. Their mission: to establish a deep connection with a specific audience—boaters.
Our goal is to transcend traditional advertising methods and seamlessly integrate LAM's brand into the boater's entire purchasing journey, from initial consideration to post-purchase.
Strategic Media Placement with Quality Assurance
In contrast to conventional boating magazine advertisements, our innovative portfolio offers strategic placements that ensure LAM's unique selling points take center stage throughout the boater's online shopping experience. Our cutting-edge software and technology guarantee high-visibility high-attention placements with zero fraud and zero waste. Every impression matters.
Engaging Content Creation
Leveraging our sophisticated tools, we curate content tailored to resonate with the boating community, emphasizing the truck's unparalleled towing capabilities and power. Our technology enables real-time feedback and dynamic content optimization, ensuring maximum engagement.
Elevated Unboxing Experience
Recognizing that the online shopping experience doesn't end at checkout but extends to the unboxing moment, M3 integrates inserts and package wraps for delivered products. These executions highlight the truck's attributes, creating an unforgettable brand moment right at the consumer's doorstep.
Physical Store Integration
M3 facilitates a store-wide rollout in collaboration with large retail partners, featuring truck displays, product experts, and live demonstrations. To enhance the experience, we organize interactive activities and drawings tailored specifically for the boating community, driving engagement and foot traffic for the retail partner and LAM.
Data-Driven Reporting & Optimization
M3's multifaceted approach ensures LAM remains top-of-mind within the boating community. Anticipated results include increased brand recognition, heightened awareness of LAM's unique offerings, and a significant rise in test drives and sales within the target segment. By seamlessly integrating LAM's brand into both digital and physical shopping experiences for boaters, we solidify LAM's truck as the obvious choice when it comes to selecting a vehicle for towing.
The online advertising industry is a data-driven beast, but here's a truth bomb: a lot of that data is riddled with deception. Take cookie stuffing, a sneaky tactic where fraudsters inject tracking pixels into ads, stealing credit for conversions they didn't earn. Cookie stuffing is just one example of a much larger problem: data deception.
Data deception throws a wrench into the entire online ad ecosystem. Here's why:
While human ingenuity can combat data deception, it's like trying to patch a leaky dam with chewing gum. Here's why:
The AdExchanger article highlights this perfectly. According to Jerome Dangu, co-founder and CTO of Confiant, advertisers are misled by inflated traffic data: "So, if an advertiser or an affiliate platform were to look at the data, they would see they have many visitors from thetop3.com and a good amount of conversions," Dangu said. "But what we see at Confiant is that the number of [valid] visitors is essentially made of traffic that is bought on Taboola for very cheap." This inflated traffic creates the illusion of a successful campaign, but the reality is that the conversions are coming from a cheap, low-quality source.
This quote exposes the flaws in relying solely on clicks and conversions as metrics. By focusing on manipulated data, advertisers are missing the bigger picture and potentially wasting their budget.
Let's face it, the whole "last click gets the credit" mentality in attribution is outdated and easily manipulated by data deception. Cookie stuffing is just one example. We need to move beyond these flawed models and consider a more comprehensive view of ad success.
Here's how:
By challenging the attribution fallacy and focusing on a more holistic view of ad success, we can move away from a system easily gamed by data deception.
Data is a powerful tool, but it can't be the only factor in online advertising. By recognizing data deception, employing human ingenuity, and focusing on a more user-centric approach, we can create a more transparent, effective, and ultimately less frustrating online advertising experience for everyone involved. Let's work together to build a better ad ecosystem!
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The landscape of digital advertising has evolved significantly since its inception in the 1990s. Each wave of development has brought new opportunities and challenges for marketers, content creators, distributors, technology firms, and more. We'll explore the fourth wave of advertising and its impact on the industry.
The first wave of digital advertising emerged in the 1990s when pioneers like AOL and Yahoo introduced content and search solutions for consumers. Although these early iterations were desktop-oriented with limited capabilities, they laid the foundation for what digital technology could become. This era opened new revenue streams and marketing channels for dotcoms and corporations willing to experiment.
Google led the second wave of digital advertising with its simple yet sophisticated approach to search and discovery. It revolutionized information access, replacing trips to the library with instant online research. Marketers quickly aligned themselves with this shift in consumer behavior. Broadband penetration became the tipping point, propelling digital ahead of print, radio, and broadcast television as the leading advertising channel.
The third wave of advertising was characterized by the emergence of social media platforms like Myspace, Facebook, Twitter, Snap, and Instagram. These platforms provided valuable consumer connectivity experiences and powerful targeting and content creation tools for businesses. The third wave also witnessed the rapid rise of direct-to-consumer (DTC) brands, thanks to early adoption, intelligent execution, and low-cost e-commerce solutions that democratized online retail.
As we enter the middle of this decade, commerce media has solidified its position as a dynamic approach for brands to engage consumers while providing monetization opportunities for retailers, merchants, and manufacturers. What began as an extension of shopper marketing within digital marketplaces has expanded upstream into consideration and awareness. Brands are eager to tell compelling stories, establish authenticity, and connect with their audiences meaningfully.
Online advertising faces challenges such as fraud and low-quality content. Commerce media represents a fresh start for marketers, offering the chance to reshape a system often neglected in favor of technical advancements and data proliferation.
The lines between e-commerce and media companies are blurring as both strive to secure consumer and marketer budgets. Amazon has pioneered paving the way for this fourth wave and stands as a dominant force in this evolving landscape. However, numerous contenders are poised to make their mark with the commerce media market surpassing $100 billion.
The fourth wave of advertising is reshaping the digital marketing landscape, offering exciting opportunities for brands, retailers, and advertisers. It represents a pivotal moment in the industry's evolution, where the focus shifts from commoditization to enhancing the advertising experience for all stakeholders. As commerce media continues to grow, it promises a brighter and more engaging future for the world of digital advertising.
Commerce media is a dynamic partnership between retailers, advertisers, and consumers.
It strategically utilizes digital touchpoints to deliver tailored brand messages for marketers, fostering revenue growth for retailers, and valuable content for consumers.
In today's fiercely competitive retail landscape, merchants are constantly on the lookout for innovative ways to enhance their profitability. One such strategy that has been gaining momentum is commerce media. This powerful approach encourages retailers to leverage their digital and physical channels to promote and raise brand awareness for other companies.
Commerce media is a dynamic marketing strategy that empowers retailers to utilize their existing digital and physical assets to promote third-party brands. While it originally gained traction in digital marketplaces, department stores, and grocery outlets, today, it offers opportunities for endemic vertically integrated merchants as well. At the forefront of this revolution is M3, an innovative solution that enables retailers to tap into the fourth wave of advertising.
In the face of ever-increasing competition and a challenging macroeconomic climate, retailers are increasingly drawn to commerce media because it can add significant profit to their business. With this capability, merchants can reinvest newfound revenue in different ways tailored to their unique goals.
Some retailers opt to reduce their marketing spend, focusing on gaining efficiencies, allowing them to optimize their existing marketing efforts and ensure they reach the right audience effectively.
Others choose to reinvest their commerce media profits back into their marketing budget.
This strategic move can lead to a substantial increase in site visitors and conversions, all while achieving a remarkable 100% return on investment.
You can invest in expanding your product roadmap or demonstrate to investors that your business is steadily marching towards profitability.
M3 empowers you with this choice, offering the flexibility to align your commerce media strategy with your business objectives.
Commerce media isn't just about generating additional revenue; it's about strengthening your competitive position in the market. By not capitalizing on this revenue stream, you risk falling behind your competitors who are already harnessing its potential.
Established commerce media practices have been shown to generate an average incremental EBITDA lift of 7-20% for retailers (source: UBS). Just imagine the impact this could have on your organization's financial health and competitiveness. It's a game-changer that no retailer can afford to ignore.
In conclusion, commerce media is a transformative strategy that offers retailers a golden opportunity to boost profitability, enhance efficiency, and outshine competitors. It's a dynamic avenue that can be tailored to your unique business goals and can significantly impact your bottom line.
Don't wait until others seize this advantage; take the lead in your industry by exploring the potential of commerce media today.
