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Online retailers, including Overstock.com and Amazon place ads on their product pages, but can this be a good idea?
The argument for suggests that advertising can allow online retailers to monetise traffic and profit from those visitors who were not planning to buy anyway. Can it work, or is it an unwelcome distraction for shoppers?
WinBuyer recently launched its Shoppers Audience Network, which allows advertisers to place targeted ads on e-commerce sites. This has been going for a month in the US on sites including Overstock.com and Bidz.com.
According to Winbuyer CEO Miki Balin, these ads are effective, as they are targeted at visitors when they are in research or purchase mode, and therefore more receptive to ads. In addition, since customers have been looking at particular product categories, the ads can be targeted and relevant.
Balin believes that this is one way that retailers can become publishers and monetise their traffic:
Since 98% of traffic typically leaves an e-commerce site without buying, retailers see these ads as a way of monetising this traffic, and relevant ads can be seen as a service by visitors. While they are there, and of they are going to head elsewhere, then why not give them some relevant ads? From a retailer's perspective, it is a no-brainer.
I asked Balin about the possibility of competing retailers advertising on sites, but at the moment the ads are restricted to brands, while retailers have the say over which ads appear on their websites.
Ads on product pages is something I have noticed before on Amazon, a site which surely has plenty of traffic to monetise. Since its product pages are relatively busy, the ads don't stand out too much:
On Overstock.com, the Winbuyer ads are in a prominent position on the page:
Since retailers are looking to convert visitors into buyers on product pages, it seems odd to place an ad in a prominent position, one that could take that customer away from a potential purchase and onto another site.
On this page, the Dell ad is probably the most prominent feature, certainly more so than the call to action to buy an item, which should be the clearest link.
According to Winbuyer, the ads are designed to target the 98% of visitors that would have left the site anyway, and conversion rates are monitored for any negative effect caused by ads. In addition, early stats from Winbuyer(the ad network was launched a month ago in the US) show that click through rates for these ads are between 0.3% and 1%, higher than the average for online display ads.
Whether this tactic is one that will work for online retailers remains to be seen. There is logic in making some money from the vast majority of visits that don't result in a purchase, but it seems counter-intuitive to place anything on a product page that could distract customers from a purchase and take them away from the site.
I'd love to hear some more opinions on the issue - can showing ads on product pages work? Have you tried it on your site? Let me know below...