May 5 2022
Ecommerce trend update: changing business models and client acquisition
In this episode, you will get all you need to stay on top of Meta & Google earning reports, DTC Media Buying, and Retail media and marketplace networks. Mike, smec’s portfolio strategist, keeps you up to date with all the changes in the online retail environment keeping the most common challenge of retailers in mind: traffic acquisition.Looking at the direct-to-consumer business (DTC), the question to answer is: how to acquire customers in an online context? Retailers have to convince people to go to their brand website and view their product when the common perception is consumers are looking for a one-stop shopping experience ( read Amazon).With changing retail media networks and marketplaces larger retailers explore new business models due to the increasing cost of traffic acquisition. You are essentially in pursuit of better targeting, performance, and clear metrics to drive your retail media network selection in the estimated 100 billion US dollars annual revenue retail media network space. These networks are often characterised by margins as high as 50% so we look at retail media networks and marketplace models, and identify what's happening there.Meta & Google 2022 Q1 earning reports made available public last week reveal certain challenges and opportunities for the future. Youtube was a particularly interesting one, at least that’s what experts are saying. They faced slowdowns in video consumption from the pandemic due to the post-pandemic behavioral shift of users and increasing competition from TikTok.Google on the other hand raises concerns about increasing traffic acquisition costs. But we also must look at their click growth, up 12% year over.Retailers who are winning at acquisition right now are going to be the people who are winning in the longer term.