As eCommerce professionals, we’re always on the lookout for innovative strategies to boost revenue and optimize our operations. In a recent episode of The MarTech Matrix podcast, host Sean Simon sat down with Greg Stellato, co-founder of M3, to discuss a game-changing approach to brand advertising that promises to revolutionize how specialty retailers generate revenue. Here’s a deep dive into the conversation and key takeaways that can benefit your eCommerce business.
The Vision Behind M3
M3 stands for “Make Merchants Money” and “Make Media Matter.” The company’s high-level vision is to support retailers by creating a new, profitable revenue stream through brand advertising and sponsorship opportunities. Greg emphasizes that the retail landscape is challenging, with thin margins, low conversion rates, and high traffic acquisition costs. M3 aims to alleviate these pressures by transforming retailers into media properties, offering premium, brand-safe advertising experiences.
Addressing Core Retail Challenges
Greg’s co-founder, Michael Cassidy, previously worked with Shopify ecosystem retailers and recognized the significant challenges they face, including destructive forces like margin erosion and high return rates. With a conversion rate hovering around 2%, eCommerce businesses are in dire need of alternative revenue sources. M3 addresses this by leveraging retail and commerce media to create highly profitable advertising opportunities for specialty retailers.
Differentiating from Traditional Retail Media
One of the standout points in Greg’s discussion is how M3 differs from conventional retail media. While retail media often caters to large marketplaces like Amazon and Walmart, M3 focuses on specialty retailers. This distinction is crucial as it allows for more contextually relevant and brand-safe advertising environments. Specialty retailers can use their established brand trust and dedicated audiences to attract premium advertisers, providing a win-win situation for both parties. The post image at the top shows how Ford advertisers on Dakine’s website. There is synergy between these brands that just makes sense for the brands and the consumer.
The Power of Contextual Advertising
Greg highlights the importance of context in advertising. Instead of relying heavily on third-party data, M3 uses the retailer’s site as a proxy for context. For instance, a new mom shopping on a baby clothing site like Carter’s is a prime target for advertisers looking to reach that specific demographic. This approach eliminates the need for extensive data manipulation and allows advertisers to align with relevant, high-intent audiences.
The Future of Brand Advertising
The conversation also touches on the future of brand advertising, especially in the context of evolving measurement techniques. Traditional metrics like click-through rates (CTR) and cost per acquisition (CPA) have driven a race to the bottom, often compromising brand integrity. However, advancements in mixed media modeling and incrementality now allow brands to measure the impact of upper-funnel media on lower-funnel metrics. This opens new opportunities for brand advertising, encouraging advertisers to invest in more meaningful, long-term strategies.
Overcoming Retailer Hesitations
Greg acknowledges that some specialty retailers may be hesitant to integrate ads on their sites due to concerns about disrupting the customer experience. To address this, M3 offers non-clickable sponsorships and branded content that reside within the retailer’s domain, ensuring a seamless and non-intrusive user experience. This approach balances the needs of advertisers for visibility and engagement with the retailer’s priority of maintaining a smooth conversion funnel.
Getting Started with M3
Integrating M3’s solutions is straightforward, often involving simple ad tags. The primary challenge lies in agreeing on ad placements that benefit both the advertiser and the retailer. M3’s approach is flexible, allowing retailers to start with email advertising before moving to on-site placements, gradually increasing their comfort level with the concept.
Conclusion
The insights shared by Greg Stellato on The MarTech Matrix podcast highlight a transformative approach to eCommerce revenue generation. By leveraging brand advertising in a contextually relevant and brand-safe manner, specialty retailers can unlock new revenue streams and enhance their overall strategy. As we continue to navigate the complexities of eCommerce, innovative solutions like M3 offer a promising avenue for growth and sustainability.
For more detailed insights and to explore how M3 can benefit your eCommerce business, I highly recommend listening to the full episode of The MarTech Matrix podcast. Stay ahead of the curve and discover new ways to optimize your revenue strategies.
