The E-Commerce Magic Bullet (Hint: It’s Not AdWords) by Chris Trayhorn, Publisher of mThink Blue Book, October 4, 2016 E-commerce companies often ask me why they’re struggling to compete. They think they are doing all the right things but they’re still not growing. Even though they are spending big budgets with their SEM agency, Amazon is crushing them, they can’t find any volume on AdWords and new customers aren’t staying with them past the first order. They keep running faster and faster, but business growth is elusive. What are they to do? For many of them the answer is hidden in plain sight. They need a smart multi-channel strategy. They need to take a long look at their brand and their messaging, then test enough so that they can build data and audiences. They need to find the spaces and gaps on different media platforms that their competitors haven’t yet invaded. And, most of all, they need to not rely on automated software platforms and outmoded SEM agencies that apply a cookie cutter model to what is a fast-moving, highly strategic advertising marketplace. Let’s just look at some of the key media platforms: SEM/AdWords: The elephant in the room. Everyone knows that AdWords is amazing for bottom-of-the-funnel conversions becasue it captures potential customers at the moment when buying intent is maximal. That’s why Google makes so much money. The trouble is that it isn’t all you need. Everyone is on AdWords, and the bid prices reflect it. And there are so many SEM agencies chasing the business that price competition has driven them into using bid optimization software and automation that simply can’t hold up against a real person creating custom algorithms. AdWords is not enough. A traditional SEM agency is not enough. Google Shopping: A massive opportunity for many e-commerce companies. The problem is that most SEM agencies don’t understand it, even though they think they do. They use the same models and the same tools as they do for SEM, and it doesn’t work. The key here is to understand that Google is terrified that a huge number of people now go straight to Amazon to search for and buy any given product. It is the biggest threat to Google’s business and they’re using Shopping to try and get some of that traffic. It means Shopping offers better rates, more availability and greater opportunity than SEM right now, but you need someone who knows how to run it properly. Facebook: Huge traffic, terrible conversion. Lots of mobile volume, but nobody is buying. These are the generally understood truths of Facebook right now, certainly when it comes to e-commerce, and in fact Facebook seems to agree given the continuing series of new e-commerce-related platform announcements they are making. The reality is that Facebook is where people are spending their time, and the first rule of selling is to be where your customers are. Facebook needs imagination applied to the sales flow and the conversion funnel to work properly. Whether that means direct-linking or squeeze pages or quizzes or viral marketing – it will vary by campaign. It can take take and effort, but once you start to find a sales flow that converts, Facebook offers so much volume that al the effort is worthwhile. Programmatic: If you are reading this article and you don’t know what programmatic advertising is, stop now and go and start reading. 70% of display advertising is bought via programmatic platforms currently, which is pretty much everything outside of premium inventory. The problem is that it can be expensive to begin with. Platform fees, minimum spend limits and learning curves all create barriers to entry that make it easier for many companies to stick their heads in the sand in the hope that it will go away. Programmatic platforms designed for smaller businesses are now available – but beware. If you aren’t totally sure of your audiences or you simply don’t have data, then the easy promises that “optimization algorithms” will do the targeting work for you are often just a way for you to spend money for little return. If you’re spending less than $10,000 a month, stick to GDN. More than that, you really should be doing programmatic. Conclusion: there is a huge amount of opportunity outside of SEM (and AdWords in particular), but each platform needs its own skill-set. The agencies and networks that are going to help their clients win in 2017 are those that can build true multi-channel campaigns that find opportunity and beat the competition wherever customers may be. Chris Trayhorn In addition to running mThink.com and the Blue Book, Chris is also the CEO of mThinkDigital, a San Francisco-based digital marketing agency focused on e-commerce and customer acquisition. www.mthinkdigital.com Filed under: Blue Book, eCommerce, Featured, Revenue Tagged under: affiliate marketing, affiliate networks, ecommerce About the Author Chris Trayhorn, Publisher of mThink Blue Book Chris Trayhorn is the Chairman of the Performance Marketing Industry Blue Ribbon Panel and the CEO of mThink.com, a leading online and content marketing agency. He has founded four successful marketing companies in London and San Francisco in the last 15 years, and is currently the founder and publisher of Revenue+Performance magazine, the magazine of the performance marketing industry since 2002.