Marketing technology company Button wants to get into retail media.
For years, the company has touted its affiliate tools for publishers, creators and retailers that allow them to deep link to product pages. Publishers, for example, use Button's tools to link to products their affiliate teams recommend. The publishers then receive a cut of sales when people click the links and buy the products. Button generates $1 billion in affiliate sales every month, CEO and co-founder Michael Giacconi told Business Insider.
Now Button is looking to cash in on a new place where brands can use their link products to run e-commerce ad campaigns: Users who click on a link on a publisher's website are served a landing page before clicking through to a purchase in the retailer's app. Retailers can then sell ads on these landing pages for brands that want to reach audiences beyond their own websites.
In theory, brands could advertise against competitors on landing pages. For example, NBCU's Peacock could target ads to users who viewed its landing page before signing up for a Netflix subscription. Jaconi said whether advertisers can “conquer” ads like this depends on how each retailer manages its own ad business. For example, Amazon's ad business supports conquest, but Kroger's ad business does not.
Similar to Button's existing affiliate model, publishers and creators who provide users with landing pages will receive a percentage of sales from those pages. Jaconi said Button intends to share the “vast majority” of ad revenue, but declined to disclose what percentage publishers and creators will receive.
Not all consumers see the landing page because Button's technology uses AI to decide whether to show a landing page after clicking a link, Jaconi said. The landing page is designed for mobile and pops up before consumers are linked to a product page in a retailer's app. Jaconi said Button is developing a desktop version of the technology.
“This is being used to open apps more efficiently, but this inventory is not being used. The inventory is left blank,” he said.
Amazon, Microsoft Advertising and BuzzFeed are participating in the Button program.
According to eMarker, advertisers will spend $140 billion on retail media worldwide this year.
Most retail media budgets are spent on on-site advertising, which appears as search and display ads on retailers' sites. But increasingly, retailers want to leverage off-site retail media — ads that run on websites other than their own e-commerce site — to expand the amount of advertising they can sell to consumers without overselling them.
One of the issues with off-site ads is that they don’t perform as well because users may see the ad on the publisher’s website when they’re not interested in making a purchase.
“The intent of these moments is not as high as the intent of retail media on retailers' sites,” said Jaconi.
Button claims that initial testing of its retail advertising product has resulted in an average 34% increase in return on ad spend (a key metric that tracks the effectiveness of each dollar spent on advertising) compared to other off-site retail media products.
As retail media grows, a small industry of ad tech companies, including Criteo, Epsilon, Pacvue and Skai, are competing for a slice of brands' retail media spend. Giacconi said Button wants to differentiate itself by leveraging high-intent data it gets from publishers and creators. Button's linking technology drives consumers to retailers' apps, which have higher conversion rates than websites.
