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Diana GordonSenior Partner and Director, Shop+Mindshare North America
As measurement tools improve, retailers can see how their marketing efforts—not just those easily tracked online—drive actions at different stages in the customer journey. This is also why essentially all types of marketing can now be considered performance marketing, according to Diana Gordon, senior partner at Mindshare North America and director of Shop+, the agency’s commerce division. eMarketer’s Tricia Carr spoke with Gordon about notable trends in performance marketing for retailers and where Google, Facebook and Amazon.com come into play.
eMarketer: How does Mindshare define performance marketing?
Diana Gordon: We don’t think of performance as a vertical specialty. We think of it as an end-to-end marketing solution. We recognize its universal appeal to all of our clients. The approach we take is to create a holistic brand-to-demand view of our clients’ businesses. That allows us to show our clients how connected communications that speak to the consumer across all the different phases of their journey can deliver against both their short-term and long-term business goals.
eMarketer: Can all types of marketing fall into the performance category?
Gordon: Our position is that as [all types of] marketing become more measurable, it all becomes performance marketing.
eMarketer: Is cost per action [CPA] the primary metric used for measurement in retailers’ performance marketing?
Gordon: Yes, absolutely. Cost per action, cost per sale [and so on] have always been important KPIs [key performance indicators]. It’s a good proxy for evaluating short-term business goals and efficacy of the media. But we don’t look at CPA in isolation. We also look for how we can optimize that media to deliver against the client’s long-term objective, whatever that may be: sales, profit, customer acquisition. All of those things have to come into balance to drive what the brand is trying to achieve with their marketing.
eMarketer: Currently, what are the trends in performance marketing for retailers?
Gordon: One trend is what we call custom curation. We see marketers tailor their product offering and even their advertising to represent a subset of highly relevant consumers, and in some cases, handpick products or services for their customers.
Another trend is delivery on demand. What makes this performance marketing is the ability to meet the needs of a customer, and this includes getting products and services to them in near real time.
The third trend is conversational commerce. This includes the use of artificial intelligence, such as chatbots, to help with customer service components and using social media as a platform for sales.
Lastly, mobile commerce now generates about 30% of total ecommerce sales. This is driven by easier and more diverse payment options and better user experiences on mobile websites. It’s important for marketers to recognize mobile as the connective tissue that bridges their in-store and online activity, and not think of it as in-store vs. online activity.
eMarketer: How important are Google and Facebook for retailers’ performance marketing?
Gordon: Google has always been valued as a performance marketing channel due to the nature of search. Now Google’s challenge is proving that its other types of media have that same sales potential, particularly video. They talk about stats like a 50% increase in product-review-related content on YouTube as proof that consumers are watching video to help influence their sales purchases.
Facebook is enabling marketers to transact and make them a solution-oriented partner. For example, Facebook partnered with Shopify to enable brands to turn their Facebook page into a storefront.
eMarketer: How influential is Amazon for performance marketing?
Gordon: Amazon is hugely important for driving both online and offline sales. For some of the marketers that we work with, their results demonstrate that Amazon media does a lot for driving offline sales. This solidifies Amazon’s position as a brand awareness platform.
On the flip side, we also think about how marketers view Amazon’s potential for growing ecommerce and the sales strategies of our clients. For example, are they prioritizing any sale, whether it comes from brick-and-mortar [stores] or online, or are they focused on getting that first category purchase online from the customer because they believe it will lead to brand loyalty and increased lifetime value?
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