More companies might compete against online advertising duopoly

Google and Facebook have long held a dominant share in the online advertising market. The two companies have some of the largest user bases in the world. Google now processes over 2 trillion searches per year and Facebook passed 2 billion monthly active users earlier in 2017, according to Statista.

But many ad buyers see that large user base as a disadvantage. Both companies dealt with controversy surrounding how advertisements are managed on certain sites and daughter companies. In response, many customers have adjusted their advertisement buying strategies. Many companies outside of the duopoly are seeing their revenue growing year-over-year.

Google and Facebook still account for 63 percent of all U.S. digital ad revenue. Of the remaining revenue, companies such as Microsoft and Oath claim nearly 12 and 11 percent respectively, according to eMarketer. Looking at the same piece of data, it’s apparent the majority of companies tracked by eMarketer have experienced some sort of growth in the share of online advertising revenue. For instance, Snapchat had a 0.2 percent share in 2015 which is expected to grow to 6 percent by 2019.

Amazon has also recently made a push into the online advertising market. Estimates from eMarketer predict Amazon currently holds a 7.3 percent revenue share of companies outside of the duopoly and is expected to reach 9.3 percent by 2019.

US Digital Ad Revenue

 

 

 

 

 

 

 

 

 

Reports from CNBC allude to Amazon making expansions on both their e-commerce searches and video services. EMarketer estimates Amazon is the 5th largest online advertiser in terms of revenue, right below Google, Facebook, Microsoft and Verizon.

Amazon currently allows businesses to promote their products in related searches but hopes to eventually give advertisers better data to allow for more precise demographic targeting. Outside of paid promotion search results, Amazon is exploring mobile advertisements, video advertising and their newly-released “Transparent Ad Marketplace” which allows customers to bid on ad space across the web.

“Amazon likes to talk about how 56 percent of product searches are coming through Amazon. It’s definitely a stat that causes advertisers to stand up.” –Diana Gordon, senior partner at Mindshare.

For e-commerce businesses, growing their websites through organic traffic is sustainable in the long-run, cuts costs that would be used to purchase advertising space and raises traffic at a higher rate than a PPC program would. Dirxion online catalogs offer SEO guide pages that involves indexing every page of the printed catalog. This practice helps boost the overall SEO of the online catalogs site. In addition, Dirxion online catalogs offer a variation of ad platform services for customers through widgets. The widgets, which come in a variation of sizes and implementations, can be either integrated into an existing advertising program or the customer can sell space directly to customers without having to use an external advertising service.

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Post-holiday shopping breaks records in retail and e-commerce

With the holiday season having concluded, market analysts can now look at the data as a whole in order to make predictions for both the next holiday season as well as e-commerce in 2018. While pre-Christmas sales surpassed expectations, both physical retail locations and e-commerce sites saw increases in traffic and revenue. According to data from Salesforce, Dec. 26 saw a 19 percent increase in traffic, 5 percent higher than the year before.

Retailers are seeing the beginnings of a new trend arising. Many Americans now utilize the day after Christmas to shop while still on break from work. During what was previously known as a “retail lag” in which stores would attempt to get rid of outdated inventory, stores are now flooded with post-holiday shoppers. 40 percent of consumers shopped the day after Christmas, according to a survey from Deloitte.

“This week has, over the years, been gradually assuming more and more importance in the overall mix. Retailers want to get a second bite at the apple.”
– Craig Johnson, president of Customer Growth Partners

E-commerce continued to outpace retail in volume and growth. Amazon recently announced over 4 million consumers started a free trial or began paying for an Amazon Prime subscription in one week alone during the holiday season, as reported by Digital Commerce 360.

There was an unexpected rise in traffic during the New Year’s as well. For instance, e-commerce traffic across the top 25 retailers in the U.S. rose by 15 percent on New Year’s Eve and 32 percent on New Year’s Day, according to data from Verizon Communications Inc.

However, e-commerce and physical retail locations have shifted into a mutualistic relationship of sorts. Many consumers use physical retail locations to make returns on items that were purchased online. For instance, Kohls began accepting returns of certain Amazon items at 82 of their stores.

Christmas Returns

 

Dirxion online catalogs offer businesses the ability to tap into shopping trends and habits during both the holiday season and throughout the year. Dirxion online catalogs also serve as a complementary product to any e-commerce operation. Both versatile and optimized with HTML5, Dirxion online catalogs ensure cross-platform and multi-browser performance standards are met.

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E-commerce giant Amazon may set its eyes on Target

Ulta Beauty’s e-commerce continues to grow

Ulta Beauty’s investment in their e-commerce platform paid off. Earlier this year, it was reported the beauty salon company’s total traffic to their website increased by 74 percent with a 104 percent increase in mobile traffic alone. The result: Ulta Beauty’s online sales for Q3 rose by 62.8 percent from the same point last year. Online accounted for nearly 9 percent of all sales for the quarter.

Ulta Ad

Improvements in the company’s supply chain lead to a 10 percent cost reduction to complete each online order, according to CEO Mary Dillon on an earnings call. Such improvements lead to the expansion of other programs, such “store to door” which allows customers to order items to be delivered to their house at no extra cost if they can’t find it in-store.

“We rolled out this capability chainwide at the end of the third quarter, and while this initiative is still fairly small in terms of demand, it’s proving quite useful and satisfying guests looking for hot brands that are not available in every store, such as MAC or Morphe,” – Mary Dillon, CEO of Ulta Beauty

M-commerce continues to be a focus of Ulta Beauty’s expansion efforts. Having re-launched their mobile application in Q3, the company saw their mobile traffic increase by 92 percent year-over-year. Ulta Beauty’s mobile app has been downloaded over 4.4 million times and has an average 4.8 stars out of 5 across the Google Play and iTunes stores.

Dirxion has partnered with Ulta Beauty to provide the company with new avenues to connect to their customers. This is done by utilizing Dirxion’s integration technologies and e-flyers within Ulta’s mobile applications. The e-flyer gives customers a new way to browse and purchase Ulta’s products in a format that can be sent to their customers at anytime from anywhere. This format also increases the efficiency in which Ulta can interact with and extend new deals to their customers. Integrated into their Google Play and Apple iTunes store applications, Ulta’s e-flyers receive a high level of exposure to their mobile customers.

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2018 may bring new changes to the online advertising market

From the formation of stricter guidelines to a growing concern over fraudulent practices, online advertising went through a year-long adjustment period. Alongside record-breaking growth, the platform sought to settle into a sustainable format which delivers on promises to advertisers and customers alike. Estimates from eMarketer predict advertisers in the U.S. will spend almost $48 billion on online advertisements.

Customers are predicted to move away from a more open-market approach towards purchasing advertisements. For instance, it was reported earlier this year that global revenue lost to the fraudulent advertising method “spoofing” could potentially reach $16 billion by the end of 2017. In addition to potentially lost revenue, advertisers have had difficulties in recent years using large platforms such as Google, Facebook and their subsidiaries.

For years, such companies have held to the mentality that the web is too large to police; therefore, it’s hard to determine exactly where their customers’ ads will appear. In YouTube’s case, a daughter company of Google, multiple investigative reports and articles this year revealed advertisements were running on videos promoting hate speech or other illegal activities. For years, YouTube used to proudly display the volume of videos uploaded to their platform. Now at 65 years of video uploaded per day, that volume has become a challenge for YouTube to monitor and a warning sign to many advertisers.

“Taken together, the openness once touted by Google, Facebook, and Twitter has taken on a new, shall we say, less positive, meaning in the advertising world. The conversation there became about “brand safety,” and based on the steady string of stories this year wherein Google or Facebook got caught running ads in an “unsafe” fashion, neither company has given the marketing world confidence it has a real handle on the monster challenge of policing massive open platforms.” –Mike Shields, Business Insider

Many companies are returning to direct advertising buying, whether through digital or traditional platforms. Estimates from BIA/Kelsey predict local advertising spending in the U.S. will surpass $151 billion in 2018, a 5.2 percent increase from last year. Despite online advertising’s consistent growth, traditional media such as newspaper and radio, still account for 65 percent of all local advertising spending in the U.S, according to BIA/Kelsey.

Ad Spending

 

 

 

 

 

 

 

 

For e-commerce businesses, growing their websites through organic traffic is sustainable in the long-run, cuts costs that would be used to purchase advertising space and raises traffic at a higher rate than a PPC program would. Dirxion online catalogs offer SEO guide pages that involves a process of indexing every page of the printed catalog. This practice helps boost the overall SEO of the online catalogs site, as well as increase the likelihood of someone finding a catalog page when searching a company’s brand name. In addition, Dirxion online catalogs offer a variation of ad platform services for customers through widgets. The widgets, which come in a variation of sizes and implementations, can be either integrated into an existing advertising program or the customer can sell space directly to customers without having to use an external advertising service.

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Holiday e-commerce sales reach unprecedented levels

The 2017 holiday shopping season has continued to break records. Consumers began their shopping earlier than ever aided by the growing retailer trend of the pre-Black Friday sale. Despite it’s reputation as a retail-orientated shopping holiday, Black Friday brought in historic e-commerce sales.

Estimates from Adobe say consumers spent a little over $5 billion on Black Friday. On Thanksgiving Day, consumers spent $2.87 billion alone, which was up 18.3 percent from a year ago, according to the same estimates.

Cyber Monday also brought in historic numbers and showed double-digit growth from a year-over-year perspective.Consumers spent $6.59 billion, according to Bloomberg News, which showed a 17 percent increase on e-commerce spending.

M-commerce, which has quietly been growing throughout the years, played a large role in the holiday shopping narrative this season. On Black Friday, purchases made on mobile devices accounted for 37 percent of all sales which generated just under $2 billion in revenue, according to TechCrunch. Cyber Monday saw similar numbers. Revenue generated by mobile devices increased 31 percent year-over-year for $2 billion in sales, according to Digital Commerce 360.

As a whole, holiday shoppers have spent a record $89.88 billion online from Nov. 1 to Dec. 17, which is a 13 percent year-over-year growth, according to data from Adobe. Adobe originally predicted to online sales would reach $107.4 billion through Dec. 31, which is expected to be reached at the current rate of online sales.

Online Holiday Sales

 

Outside of e-commerce, holiday spending in total has reached decade-high levels. American shopping intentions this holiday, on average, will top $900, according to a survey conducted by CNBC. The average is higher at a large margin than last year’s $702 and is the first time in the survey’s 12 years that the average broke $900.

Dirxion online catalogs offer businesses the ability to tap into shopping trends and habits during both the holiday season and throughout the year. Dirxion online catalogs also serve as a complementary product to any e-commerce operation. Both versatile and optimized with HTML5, Dirxion online catalogs ensure cross-platform and multi-browser performance standards are met.

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Extensions of m-commerce have difficulty catching on in some areas

M-commerce has continued to evolve in recent months as consumers experiment with how the technology fits into their purchasing habits. M-commerce has grown over time, with an increasing number of consumers using their mobile devices to research and make online orders.

However, certain branches of m-commerce have yet to be embraced by consumers in Western countries, where the technology is relatively new. For instance, 56 percent of consumers in the U.S. don’t prefer mobile payment methods, according to a survey conducted by Kantar TNS.

Mobile payments, often referred to as “mobile money,” allow consumers to make payments from their phone, most popularly by tapping the phone to a card reader. They often come in the form of platforms in which the mobile device holds credit or debit card information to act in lieu of that card. Companies such as Apple, Android, Mastercard and Paypal all offer mobile payments.

Many mobile payment platforms require specific receptors, which often must be purchased and installed by retailers, in order to properly make a purchase. The willingness and ability of vendors to install these receptors is currently the biggest barrier of entry for mobile payments to properly enter the market. Apple Pay is currently the most accepted mobile payment, with 36 percent of American retailers accepting it. However, for many other payment methods, retailers are choosing to wait and see how the market acts before making the adjustments.

There are certain markets however, who don’t follow the trend of resistance towards mobile payment platforms. Estimations from eMarketer predicts nearly 78 percent of smartphone users in China will use a mobile payment platform in 2018. Of the 56 countries surveyed in the Kantar TNS survey, only China and Mongolia had a majority of participants say they prefer to use mobile payments at 64 and 63 percent respectively.

Dirxion offers app development for both the Google Play and iTunes stores. Within the apps, customers are able to view a business’s online catalogs or download them for offline viewing. Dirxion can also integrate online catalogs into an existing application. Companies without a dedicated e-commerce mobile app benefit from an audience built from a Dirxion online catalog app. Companies have a direct avenue to a captive audience of customers via push notifications which can inform of new catalog releases, upcoming sales and other pertinent company news.

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E-commerce investment pays off for Walmart

Following a summer of acquisitions and growth from Amazon, a larger narrative began to form for legacy retailers. They were viewed as stagnate and doomed to fall to the growing e-commerce market. However, shifts in business strategy coupled with a newfound omni-channel blend has lead to encouraging results for big-box retailers. Walmart has been one of the major companies leading the charge into this new, e-commerce-fueled era.

Walmart, who recently re-adjusted their e-commerce strategy, showed their ability to aggressively compete with Amazon. Recent earnings and growth have left many market analysts feeling as if they underestimated the legacy retailer’s ability to build a presence on the e-commerce market.

As part of their new strategy, Walmart went on an acquisition spree similar to Amazon’s. To start, Walmart purchased Jet.com, an American e-commerce company, for $3 billion in August of last year. According to a press release on Walmart’s official website, the acquisition was intended to build upon Walmart’s existing e-commerce foundation and expand upon their efforts to integrate their online and in-store shopping experience. Walmart bought other “e-commerce-friendly” companies such as ModCloth, Shoebuy and Bonobos.

“Walmart.com will grow faster, the seamless shopping experience we’re pursuing will happen quicker, and we’ll enable the Jet brand to be even more successful in a shorter period of time. Our customers will win. It’s another jolt of entrepreneurial spirit being injected into Walmart.” – Doug McMillon, president and CEO of Wal-Mart Stores, Inc.

The aggressive acquisitions have paid off for the legacy retailer, as Walmart recently reported online sales were up 50 percent for Q3. Following such growth, Walmart has looked to continue to expand their e-commerce efforts. The company has been experimenting with new ways to integrate Walmart.com with their physical stores.

Walmart now offers lower in-store prices for food and household items, according to the Wall Street Journal. For instance, a 32-ounce bottle of Heinz ketchup which is $3.38 online costs $2.83 in-store. Additionally, Walmart now offers free two-day shipping on orders over $35 and self-service “Pickup Towers” for customers picking up online orders in-store.

Heinz Ketchup

 

Walmart and other large legacy retailers are now pursuing omni-channel routes to combine their offline and online sales efforts. However, these methods and strategies aren’t exclusive to large conglomerates. Dirxion online catalogs give both retail and B2B companies a tool to create an omni channel approach for their businesses and aids any e-commerce operation. Both versatile and optimized with HTML5, Dirxion online catalogs ensure cross-platform and multi-browser performance standards are met.
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Consumers, aided by e-commerce, began their holiday shopping earlier than ever

For some Americans, the holiday shopping season begins on Black Friday. But for many others, e-commerce and pre-Black Friday online deals have continued to push holiday shopping earlier and earlier in November. Earlier in November, Adobe predicted holiday shoppers would spend $107 billion during the holiday season (officially Nov. 1-Dec. 31). At this point in time, U.S. shoppers are on pace to spend $109 billion.

Holiday Shopping

 

E-commerce holiday shopping on Black Friday could even generate more sales than Cyber Monday, the traditional day most businesses and consumers allocated for online deals. Last year, Black Friday generated $3.34 billion in online sales which was just below the $3.45 billion generated by Cyber Monday sales. However, from a growth standpoint, Black Friday online sales have increased at a much faster rate than Cyber Monday. According to more data collected by Adobe, Black Friday online sales have grown by 21 percent whereas Cyber Monday online sales have grown by 12 percent year over year.

“Holiday online shopping continues to trend earlier and earlier each year, with this year eclipsing last year by about a week” – Bob Buffone, Founder & Chief Technology Officer at Yottaa

Consumers and Mobile

Mobile devices continue to play a role in the e-commerce market well into the holiday season. Projections from Salesforce indicate smartphone traffic will generate 60 percent of online traffic to retail sites during the holiday season.Additionally, conversion rates for mobile devices are expected to rise during the holiday season. Mobile devices will account for $1 of every $4 made from e-commerce sales, according to comScore. The majority of purchases made on mobile devices are expected to be smaller, less-expensive items whereas larger purchases will be made on desktop or larger electronic devices, as predicted by Kevin Bobowski, senior vice president of BrightEdge.

Dirxion online catalogs offer businesses the ability to tap into shopping trends and habits during both the holiday season and throughout the year. Dirxion online catalogs also serve as a complementary product to any e-commerce operation. Both versatile and optimized with HTML5, Dirxion online catalogs ensure cross-platform and multi-browser performance standards are met.

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E-commerce sales grow for online catalogs customer MSC Industrial Supply

Recently, MSC Industrial Supply announced strong Q2 results highlighted by increases in net sales (2.9% year-over-year), operating income (7.6%) and diluted earnings per share of $0.93, which exceeded expectations. A majority of this revenue, 57.8% of it, was accounted for by e-commerce operations.

This is a growing trend for MSC, whose e-commerce has been a significant chunk of its revenue for a few years now (it was 55.4% in the year-earlier quarter). According to Digital Commerce 360, mscdirect.com, the company’s e-commerce site, is No. 97 in the B2B E-Commerce 300, a list that ranks companies on their annual Internet sales.

The same article points out that CEO Erik Gershwind said that MSC will continue to invest in its e-commerce, by adding about 150,000 product SKUs in the current fiscal year and expanding above 1 million SKUs available online.

Dirxion is proudly involved in buffering MSC’s e-commerce performance through the creation, linking and customization of the company’s online catalogs. The primary project that Dirxion and MSC build together is its Virtual Big Book, a full collection of MSC’s product SKUs organized and displayed through over 4,000 print catalog pages.

Each product number in the catalogs are linked directly to MSC’s e-commerce pages, with an iFrame of the product page displaying the corresponding information directly in the online catalogs interfaces. The image below shows the iFrame view opened on a desktop computer.

MSC Industrial Supply Online Catalog

 

Uniquely displayed on their website pages, the Virtual Big Book is embedded in a tab pull-out that can be found on the left-hand side. This custom presentation is enabled by custom coding created and shared among Dirxion and MSC’s website developers. The embed is made easier via HTML5 rather than Adobe Flash technology, which Dirxion successfully moved away from four years ago.

MSC does a great job of maintaining fast-loading e-commerce pages, in spite of such a large database from which to pull information. The same standards of speed and loading efficiency are applied to its online catalogs.

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