2023 is turning into the year of efficiency and optimization and at Cogent we think that’s a good thing! We are helping brands reduce their “ad tax,” increase their margins, and reduce their cost of sales. Here are some ways all brands can benefit:
1.) Ad Tax: Programmatic ad buying was supposed to make advertising more cost efficient but in a lot of ways, it hasn’t. The major DSP’s charge fees for everything. Brands have told me that sometimes their fees exceed 50% which is mind-boggling. There are just too many hands in the pot. The same is true on Amazon.
One solution is audio advertising with Audiohook. They don’t mark-up anything and are completely transparent on everything from their fees to pass-through costs, to bid clearing. Best of all, the majority of the inventory comes directly from the pubs rather than SSP’s which is where a huge cost savings comes in.
2.) Margins: Much can be gained by avoiding unnecessary ad taxes but on Amazon specifically, brands are getting squeezed. Amazon has created a nice little monopoly for itself but they may be overreaching now. If you want to be successful on Amazon, you need to advertise on at least one of Amazon’s ad platforms and Amazon doesn’t share important data with you so you need to trust them. Perhaps we should ask MacKenzie Scott if we should trust Jeff Bezos…
One solution is Nimble Ads. They aren’t as well known as Amazon or many of the other 3rd party vendors that play on Amazon but they were created by a former Amazon engineer so they know a thing or two about the platform. They also beat the other vendors on cost and performance so they can pay for themselves pretty quickly, thereby increasing your margins.
3.) Selling online without a real person is more difficult than IRL. Most people respond well to human interaction, especially within retail. eCommerce doesn’t have the same feel as IRL and to emulate it has been very costly, until now. A company called FEEL has developed a sales cloud and video co-shopping technology that does the best job at emulating IRL than we have seen to date.
FEEL works primarily on commission and has a much higher close rate than the 2% CR that most retailers achieve without human interaction. Some of their customers are experiencing a 30% close rate with 2x AOV’s. It’s much each to upsell someone when you can present them with the best option via a conversation than images on a page, although there are some good tools for that too (FindMine). FEEL isn’t for every online retailer. If you sell medium to high consideration products and you have an AOV over $150, they might be good to consider. If you sell socks, probably not a good fit.
I hope these ideas help you create more efficiencies in your business while also helping to increase sales during a difficult year. Drop me a line at sean@becogent.co if you want to learn more or just brainstorm ideas for your business. #advertising#ecommerce#business#technology#sales#data#cloud#retail#amazon
