In this interview, Nikolaus Spitzy, General Manager & SVP Advertisers at mrge, explains what mrge is doing to combat invalid traffic – and why fraud is a problem in general.

Nikolaus, as a technology provider, you create the link between publishers and advertisers. You provide tools that advertisers can use to generate more traffic and increase their revenues. One of the big challenges in your industry is ad fraud, also called invalid traffic: How does fraud occur, and what are the consequences?

Spitzy: Fraud has accompanied the advertising industry ever since it went digital. It’s the old story: Ifthere is money to be made, fraudsters are never far off. All market participants have been discussing and investigating the resulting problems for many years. So far, nobody has found a recipe to completely prevent this fraudulent behavior. Invalid traffic is also a relevant issue for us. That’s why we tightened our standards in 2022 once again. Now we can protect our advertisers from invalid traffic using the best available technology. 

So, what are common fraud mechanisms?

Spitzy: For us, fraudulent behavior is any type of traffic that violates our T&Cs, and those of our advertisers. This includes traffic from non-compliant sources, insufficient transparency, and conspicuous click behavior that leads to conversion. Fraud harms advertisers because they spend their advertising budgets on irrelevant traffic. And it harms reputable publishers because those advertising budgets are no longer available to them. Our image is also negatively affected – after all, we provide the technology that connects advertisers and publishers. 

The causes of fraud are mainly bots. They are used by fraudsters to generate clicks, which are thus not intentionally caused by a human. The fraudsters collect the commission for the traffic from the advertiser. The advertiser, in turn, has nothing to gain because there is no potential buyer or lead behind the click. Advertisers pay for fake traffic, so budget is effectively lost. Bots are difficult to detect because advertisers buy traffic via publishers from different sources. This is absolutely correct and important – media buyers, in particular, can identify global ad placement opportunities and achieve greater reach for advertisers, with less investment. As a result, performance increases for the advertiser. But: This multitude of traffic sources inhibits transparency, because fraudulent bots don’t stand out in the crowd.

So who is the “bad apple” in this scenario? 

Spitzy: Most publishers have the same goal we do: Use technology to create honest, valid, revenue-oriented relationships between them and advertisers, and thus ensure high-quality traffic. But there are some bad apples among publishers. They do not subject their traffic sources tosufficient quality checks. 

What standards do you now have in place to fight invalid traffic? 

Spitzy: Until recently, our options were limited. But in 2022, we were able to take decisive steps against fraud. Three measures, in particular, are coordinated and interlinked: 

• We have tightened our T&Cs. Any publisher who violates them will be put on the block list.
• Together with Picalike, we have developed a crawler.
• We work with 24metrics and can screen traffic.

One of the most important standards results from our cooperation with 24metrics. We can now detect and block click-level threats in real time. What’s more, we

• Enable customizable filter options at offer/publisher level
• Identify “cookie dropping” already at click level
• Create detailed click reports to transparently communicate the reasons we reject a publisher’s traffic

We fine-tune our filter settings and get a complete screening of traffic. This way, we can prevent publishers from delivering non-compliant or unwanted traffic to partner networks and advertisers. We also screen new publishers and make it clear what criteria we apply. 

On the technological side, we are also able to detect: 

• VPNs and proxies
• Bots and emulators
• Click spikes
• Low conversion rates
• Double IPs
• Known fraudsters (via IP fraud database)

You mentioned developing a “crawler” – what exactly does that do? 

Spitzy: The crawler we set up with Picalike is another key method we use to ensure T&C-compliant traffic and to combat fraud. It regularly checks around 500 websites, portals, and chats. This allows us to seamlessly trace the entire traffic history, including all redirects. The crawler cannot be blocked or locked out. With this solution, we prevent traffic from unwanted sources, especially adult content. 

If publishers are found to be behaving fraudulently, we talk to them, and if their behavior does not change, they are placed on our block list. This protects our advertiser customers: Their ad impressions will no longer be delivered via undesirable domain categories. 

Is this standard in the industry?

Spitzy: No, this goes beyond industry standards. Yieldkit, one of mrge’s three companies, was one of the first affiliate marketing providers in Europe. So we have gained an enormous amount of insight into the tricks that fraudsters use. Using this knowledge, we have now completely modernized our technology, and, with 24metrics and Picalike, developed measures that arefuture-proof. This puts us ahead of the curve again, and lets us offer our advertisers and networks a technology portfolio that gives them security.

We also notice that very few providers share our standards. Some publishers we have blocked are accepted by a competitor the very next day. 

Fraud has been a hot topic for years – why is it still such a big problem?

Spitzy: There are more and more traffic sources, and more and more advertisers. And where there is demand, providers – whether fraudulent or reputable – emerge to meet it. The industry has done a lot in recent years to combat fraud, but there is still a lack of solidarity across all sectors and between competitors. 

Block lists, like the one we have now, should really be an industry standard. Competitors or not, we need to speak with one voice when it comes to eliminating fraudulent publishers and preventing scams in the realm of affiliate marketing.

The billing models at a glance

Cost per click (CPC): The advertiser is billed per click. As a result, the advertiser only pays the publisher when users click on the advertiser’s banner via the publisher’s website.

Cost per order (CPO): A click on the advertising banner is also a prerequisite here, but is no longer a reason for the advertiser to pay the publisher. Payment only happens if the user actually makes a product purchase. This model is also known as “cost per acquisition” (CPA).

Cost per lead (CPL): In this model, the advertiser is not primarily interested in clicks or sales, but in generating leads – and only then paying the publisher. For example, by getting people to sign up for the advertiser’s newsletter via a banner on the publisher’s site. Car dealerships also like to use this model to persuade prospective buyers to take a test drive.

Tenancy placement: This is a fixed fee paid by the advertiser to the publisher – for example, to secure a prominent placement in the publisher’s newsletter – independent of performance. The mechanism is very similar to booking advertising space in a daily newspaper. This may sound old-fashioned, but is far from out of date. More on that later.

The billing models for advertisers: Your goal determines the path

If you’re an advertiser and want to play it safe with your ad campaign, the CPO variant seems like your best choice at first glance. After all, you only pay a commission to the respective publisher if you actually sell products and thus earn money. Any non-sale clicks on your advertising banner are free of charge.

The CPL model is similar. Here, too, you only pay a commission to the publisher if you successfully generate leads via the advertising banner: new subscribers to your newsletter, for example, or orders for free product samples, or downloads of your whitepaper.

Given this, why should advertisers choose the CPC model at all? Because it allows them to create awareness for their product in users’ minds. This move can then make a CPO or CPL campaign all the more successful in the next step, as even more people actually complete a purchase. This strategy makes sense especially for newcomer brands.

From the advertiser’s point of view, a similar argument applies to tenancy placement: The advertiser pays a (possibly high) fixed price, e.g. for placement in a newsletter, without any performance guarantee. What is almost certain, however, is a high visibility among the subscribers of the newsletter. Depending on the opening rate and number of subscribers, a prominent placement is almost guaranteed. And, if the advertiser then books a CPC or CPO campaign with the same publisher following the tenancy placement, this increases the chances of success enormously. This is because the publisher’s audience already knows the advertiser’s brand. The effect is thus comparable to a prominent OOH placement at a busy location, such as an airport.

To sum up: Advertisers need to accurately assess the awareness of their own brand, and use this insight to set goals. These objectives then determine the best billing model.

The billing models for publishers: Know your audience

While CPO seems, at first glance, to be the most profitable for advertisers, this is true for the CPC variant from the publisher’s perspective. As a publisher, this model asks you to “deliver” relatively little, but you are remunerated for every click you generate for the advertiser.

In the case of CPO or CPA, on the other hand, your risk initially appears to be quite high, as you can hardly influence whether the users actually make a purchase from the corresponding advertiser. The same applies to the CPL model. However, this risk can be reduced to a minimum if you know your audience well. The better publishers know the people and their habits and preferences, the better they can predict what products are of interest to users.

If you operate a sneaker blog, for example, you can assume that your readers are particularly interested in shoes and are especially receptive to corresponding advertising measures. CPO-based booking thus is equally beneficial for all three parties: publisher, advertiser, and audience. If the campaign is a success for the advertiser, e.g. because it has generated an above-average number of sales, this also strengthens your negotiating position as publisher. If the campaign performs well, it is likely that the advertiser will want to continue working with you and may even be willing to pay a higher price next time.

In the case of tenancy placement, your primary concern as publisher is to produce good content and grow an engaged audience. If, for example, you have a successful newsletter with a high number of subscribers and an excellent opening rate, this provides you with strong arguments for setting an appropriately high fixed price for the placement.

What a Commerce Advertising platform can do

A Commerce Advertising platform like mrge can help both publishers and advertisers make informed decisions about which billing model best suits their campaign and their individual needs. In addition, mrge has a broad pool of trusted contacts on both sides and can thus act as a neutral mediator.

App Tracking – what was that again?

App tracking is about evaluating the user activities both around and within an app and deriving learnings for the company from them. These activities include, for example, download behavior, end device, or the language of the respective user. Behavior within an app includes, among other things, the duration of use, behavior within the app (e.g., clicks on certain buttons), or possible in-app transactions. Personal data can, but explicitly does not have to be included. Even so, they are equally valuable sources of information for publishers with their own apps and for advertisers who want to advertise in these apps. 

5 advantages that make app tracking attractive – for advertisers and publishers

• Almost half of U.S. citizens (46%) say they use their smartphones four to five hours a day. Since apps are an integral part of smartphone use, it stands to reason that they spend a lot of time there as well; an assumption that is supported by the next statistic.
• The Affiliate platform Awin recorded more than 14 million (+19% compared to the prior year) in-app sales for its customers in 2022, generating nearly $31 million in publisher commissions (+55%). The trend is rising.
• Average order value, as well as engagement and conversion rates, are significantly higher on average in apps than on the desktop or mobile browser.
• Advertisers get deeper insights into the performance of their campaigns with app tracking than they would without it, and can pretty much tell who their most important partners are on the publisher side. On this basis, they can, in turn, make even more informed marketing decisions than without app tracking and optimize their campaigns accordingly.
• App tracking allows publishers to maximize their commission or get exactly the compensation they deserve in the first place. Without the use of app tracking, publishers would miss out on those customers who are directed through their portal directly to a merchant's app – and thus also lose the commission, even though they contribute to the sales.

5 steps to successfully set up app tracking

Typically, app tracking is done with the help of a Mobile Measurement Partner (MMP). This is an independent third-party provider that collects and processes mobile app data to transparently illustrate the performance of the respective campaign. The following steps must be followed to enable app tracking:

• The advertiser integrates the software development kit (SDK) of the respective MMP into its app to grant it access.
• Advertiser sets up different commission groups per app event type (install, purchase etc.) according to which the publisher remuneration is determined. 
• The Advertiser deposits its own Merchant Identification Number ("MID") with the respective MMP. The MID is a unique ID assigned to an advertiser's programme by Awin. 
• A postback, or notification, is set up for relevant user actions, such as installing an app or making an in-app purchase.
• A tracking link is generated, and tested (by Awin) and upon successful results, the campaign is activated.

And what about Apple's App Tracking Transparency?

This brings us back to the initial question of this article: What good is in-app tracking if users do not allow tracking in their apps? In fact, the industry is already working on ways to meet the high privacy demands of users and the corresponding measures of Apple, Google, and others – and still offer advertisers and publishers attractive data. Many MMPs have developed special postbacks, for example, which inform the advertiser when app sales are generated through an affiliate link, but which do not pass on any personal data or even an order ID. Nevertheless, these sales can be assigned to the correct publisher so that they don’t suffer any disadvantage. Affiliate networks like Awin or commerce advertising platforms like mrge can help advertisers and publishers understand these challenges and how to work alongside them and get the most out of app tracking.

Commerce Advertising in the Living Sector: High Value, Targeted Success, and Brand Opportunities

The average shopping cart values in the living sector are significantly higher than in other verticals. To be precise, the average order value in the home and furniture sector was $235 in February 2023 – the best value in the industry, far ahead of fashion and accessories with an average of $138. It makes a difference whether a customer buys clothing or invests in a new couch or dining table. However, this also means that publishers can expect higher payments, regardless of the billing model.

Moreover, the living sector offers a unique advantage in reaching customers further down the sales funnel compared to other industries. Many individuals searching for furniture online have already made the decisive choice to make a purchase, with spontaneous purchases being more of an exception. This favorable scenario enhances the chances of success for both advertisers and publishers, ensuring a more receptive audience for their marketing efforts.

Despite the informed purchase decisions in this sector, the decision-making process isn't necessarily shorter, particularly when it comes to furniture. The significance of such investments, coupled with their high costs, prompts customers to exercise careful consideration in making their choices, impacting their homes in significant ways. This extended decision-making period presents an opportunity for publishers and advertisers alike to increase awareness of their content and offers, engaging potential customers with valuable information. Brand awareness, particularly within the low-price segment, is comparatively lower in the living sector. Customers tend to prioritize the price-performance ratio over brand loyalty when selecting items like couches. This makes Commerce Advertising an ideal avenue for smaller and new players to achieve high visibility across various channels and ad formats, leveling the playing field and offering a chance to compete with established brands.

Leveraging Commerce Advertising presents immense opportunities for advertisers to manage and optimize their advertising activities effectively. Particularly with the help of a Commerce Advertising platform like mrge, product categories can be weighted and prioritized differently. In this way, product categories, product groups, or individual bestsellers can be pushed in terms of visibility and sales. The high diversity of different user touchpoints allows an optimal traffic mix to be put together that is tailored to the retailer’s goals and product ranges.

3 benefits that Commerce Advertising can offer advertisers in the living sector

1. The living sector is a very tough place. Individual, large retailers such as OTTO, IKEA, and XXXLutz dominate the e-commerce market. That’s why there’s no alternative for any other players, especially medium-sized companies, but to rely on Commerce Advertising and, above all, to find the right publishers for themselves in order to be visible and competitive with the competition at all possible user touchpoints.  
2. In the living area, the average shopping cart value among retailers can differ significantly. This variation is due to some focusing more on high-priced furniture, while others prioritize additional categories like home accessories alongside furniture. To ensure effective cost management, it's crucial to align expenses with generated shopping cart revenue or brokered sales. Commerce Advertising proves particularly successful in this regard, as it enables precise analysis of campaign touchpoints to identify areas where user conversions are strongest, allowing for efficient campaign targeting.
3. As previously mentioned, brand awareness holds secondary importance in the living sector. The reason behind this lies in the prevalence of the same product lines or collections available across various retailers. To stand out, it becomes essential for them to discover other unique selling propositions, such as swift delivery, free delivery, installation services, price discounts, or smart voucher marketing. Ideally covered by a Commerce Advertising campaign.

3 benefits that Commerce Advertising can offer publishers in the living sector

1. Due to the often-high shopping cart values, publishers in the living sector can also earn attractive commissions. For this to work, it is important that they provide users with advice throughout the entire customer journey. In the beginning, users are primarily looking for content to inspire them in their furniture search, while later, they are primarily interested in comparing the conditions at different retailers (delivery times, additional services, prices, etc.). 
2. It is important to use innovative content formats across all topics and channels – including in the living sector. One example is the integration of AR applications (“augmented reality”), which allow users to virtually project furniture of interest to them into their own homes. This offers them real added value and thus represents an attractive environment for advertisers. In the USA, 20 percent of 18- to 34-year-olds already use or have used AR and VR solutions when shopping online. 42 percent are generally interested.
3. Especially when it comes to the topic of living and furnishing, people are looking for information and advice. Publishers have to offer users well-founded decision-making support, provide them with answers to questions such as “Where can I find the best price?” and “Where can I get the best service?” and at the same time generate as many sales as possible with the respective partner. In a B2C survey, for example, 31 percent of respondents cited free shipping as one of the main reasons for ordering furniture online; 48 percent cited the uncomplicated ordering process.

Particularly in the furniture business, advertisers should position themselves with a diversified traffic mix

When it comes to furniture and home accessories, people make the decision whether to buy something quite quickly – but after that, there is a longer process ahead of them, involving many different aspects such as delivery time, set-up services, and price. Advertisers need to distinguish themselves from the competition on precisely these points – and that’s exactly what Commerce Advertising is ideally suited for. mrge, with its shopping24 entity, has a very strong presence in the living sector and can assist in mediating between publisher and advertiser as well as in subsequent ongoing campaign optimization.

In the realm of influencer marketing, the era of mega influencers like Kim Kardashian, Dwayne Johnson, and Charli D’Amelio has cast a formidable shadow. With their massive followings reaching hundreds of millions, they dominate the spotlight. However, within this domain, a new breed of influencers has quietly emerged and is reshaping the landscape: micro-influencers. Despite their smaller audience sizes, these micro-influencers wield extraordinary engagement levels and offer a unique avenue for brands to authentically connect with their target markets.

An Overview of the different types of Influencers 

Five advantages that make micro-influencers appealing to every brand

Micro-influencers stand out for their dedication to specific niche topics, sharing valuable tips and in-depth knowledge with their engaged communities. Whether it's delving into the world of cosmetics, navigating the joys and challenges of new parenthood, or embarking on travel adventures, these micro-influencers cater to a more focused audience compared to their macro or mega counterparts. Moreover, within the realm of micro-influencers, a rising trend is the emergence of "deal-centric influencers." These influencers specialize in curating the best deals and coupons for their followers within a specific market segment. For brands seeking Commerce Advertising partnerships, collaborating with micro-influencers presents numerous advantages:

1. Enhanced Engagement: Micro-influencers target much smaller audiences than macro or mega-influencers, they tend to generate higher engagement rates. This, in turn, is often accompanied by a higher conversion rate. In 2022, the average conversion rate of micro-influencers in the U.S. was an incredible 26.9 percent.
2. Authenticity and Trust: Most micro-influencers are motivated intrinsically, speaking passionately about their chosen topics. Their authenticity resonates with their community, fostering trust in their recommendations. These qualities naturally extend to the brands they collaborate with, bolstering their credibility among consumers.
3. Relatableness: Micro-influencers often exhibit a more relatable and genuine approach compared to their macro and mega counterparts. Their less polished, everyday demeanor allows followers to connect on a personal level. This connection intensifies when micro-influencers have personal ties to the brands and products they endorse. For example, young parents endorsing baby products can establish a strong connection with their audience, especially if they personally use the items they promote.
4. Targeted Audience Appeal: Micro-influencers attract followers with specific interests or needs. For instance, an influencer might curate coupons and deals tailored to a particular audience segment. Collaborating with relevant brands becomes mutually beneficial in these cases, as micro-influencers cater to a wide range of verticals, ensuring a suitable match can be found.
5. Performance-Based Metrics: Unlike campaigns involving macro and mega influencers, which operate akin to traditional TV commercials billed per "airing," micro-influencer campaigns follow a different approach. At SourceKnowledge, for instance, we exclusively bill based on clicks. This method minimizes risk for brands, as they only pay for engagements. The ability to measure the campaign's efficacy through precise metrics empowers brands to gauge its worth effectively.
   The unique characteristics of micro-influencers, including their focused audience, authenticity, relatability, targeted appeal, and performance-based billing, position them as a compelling choice for brands seeking impactful influencer marketing partnerships.

Three figures that illustrate the high potential of micro-influencers

Micro-influencers have captured the spotlight in the realm of influencer marketing, boasting remarkable potential that is supported by compelling statistics. Let's delve into three key figures that illuminate the power of micro-influencers:

1. Elevated Engagement: As previously mentioned, micro-influencers excel in cultivating active engagement from their followers. Our data at SourceKnowledge reveals that they achieve an impressive 47 percent higher engagement on their content compared to macro influencers. This heightened level of interaction strengthens the connection between micro-influencers and their audience, creating a fertile ground for effective brand messaging.
2. Unleashing Online Shopping Surge: The advent of the COVID-19 pandemic brought about a surge in online shopping, propelling micro-influencers into the forefront. In 2022 alone, micro-influencers within SourceKnowledge's pool generated an astounding 372,000 clicks and amassed a total revenue of approximately $85,000 in the United States. This marked a significant increase from the previous year, where the figures stood at 31,000 clicks and $11,000 in revenue, respectively.
3. Conversion Rate Ascendancy: The average conversion rate of micro-influencers has witnessed a consistent upswing in recent years, according to our data at SourceKnowledge. In 2020, the conversion rate stood at 1.83 percent, which then surged to an impressive 12.2 percent in the following year. Building on this upward trajectory, 2022 witnessed a remarkable conversion rate of 26.9 percent. These figures underscore the persuasive impact micro-influencers wield in driving tangible results for brands.

As a brand, how do I find the perfect micro-influencers?

If you're a brand venturing into the influencer realm, it's crucial to observe and analyze micro-influencers within your industry. Take note of how they engage with their audience, understand the demographics of their followers, and examine their approach to product promotion. However, conducting this research can be time-intensive.

At SourceKnowledge, we offer a unique approach to influencer selection. Rather than the brand choosing the influencer, we reverse the process. Micro-influencers, being intimately acquainted with their audience, possess a deep understanding of which brands and products align with their followers' interests. Acting as the intermediary, SourceKnowledge bridges the gap, connecting both parties seamlessly. Rest assured, brand safety is of utmost importance to us. We meticulously vet the influencers within our network, ensuring their credibility and professionalism meet our stringent standards.

By leveraging the expertise and resources of SourceKnowledge, brands can streamline their influencer research, access targeted micro-influencers, and guarantee a secure and productive collaboration.

Get started now with SourceKnowledge in micro-influencer marketing

We equip you with the essential tools to seamlessly integrate (micro) influencer marketing into your brand strategy. Our expertise lies in collaborating with deal-centric influencers, whose dedicated audiences actively seek out discounts and exclusive deals. By leveraging our services, you can sidestep the arduous task of personally researching and identifying suitable influencers. Instead, allow us to connect you with our extensive network of influential individuals.

Since joining the SourceKnowledge Influencer Network, MyDealAddiction has worked with retailers such as Wine.com, Wayfair, Chewy, Michael Kors, Macy’s, Womanizer and more.

Michelle St. Pierre of MyDealAddiction said, “I love being a part of the SourceKnowledge Influencer Network. SourceKnowledge has helped me connect with a wide variety of respected retailers and offers a very fair and straightforward pay model.”

Don't miss out on the opportunity to enhance your brand's reach and engagement. Contact us today to get started with SourceKnowledge and unlock the potential of micro-influencer marketing.

The resilience of Commerce Advertising as a business model remains unaffected by the disabling of third-party cookies in all browsers and the various alternative options that may emerge. If you are seeking to learn more about the distinction between first-party, second-party, and third-party data, as well as the cookie regulations across various web browsers, you are in the wrong place. However, if your aim is to understand why Commerce Advertising remains largely unaffected by this entire issue and why, as a result, it stands as one of the most promising and secure models for advertisers and publishers, then you are in the right spot.

“Cookiepocalypse” in Commerce Advertising: What happened? 

A diverse range of stakeholders, including advertisers, publishers, ad networks, content creators, and more, derive their revenue from Commerce Advertising. While some perceive a threat to their business with the potential demise of third-party cookies, this belief is misguided. To understand why, let's delve deeper into the mechanisms of Commerce Advertising: 

In Commerce Advertising, users engage with relevant articles on a publisher's website or search for coupons. Ideally, they click on a link that directly leads them to the advertiser's online store. Publishers earn a commission for each click in Cost-per-Click (CPC) campaigns. In Cost-per-Action (CPA) campaigns, the advertiser's site tracks purchases, and this data is shared with the advertising network, which can identify the publisher based on the click ID and proceed to pay out the agreed-upon amount.

Depending on the technology used by the advertiser or the advertising network, third-party cookies may still be used to gain a better understanding of the audience and to target advertising more effectively. However, for click-out tracking and billing in Commerce Advertising, these cookies are not necessary. Alternative tracking methods that do not rely on third-party cookies are typically utilized, such as server-to-server tracking. In this approach, a first-party cookie is set on the advertiser's website (= on their server), and the conversion data is exclusively exchanged between the advertiser and the advertising network by establishing direct communication between their respective servers. Unlike other marketing channels, only information about the publisher who initiated the sale is shared, while no personal data about individual users is disclosed. Since server-side tracking ensures that data remains exclusively accessible to the advertiser and is not shared across multiple websites, it aligns with the general data protection regulations (GDPR).

Across industries and independent of Commerce Advertising, we are convinced that when the cookie crumbles, solutions will emerge. Throughout its history, the industry has consistently demonstrated its agility in responding to shifting market conditions, finding prompt resolutions to any challenge that arises.

Why first-party data has long been the gold standard in Commerce Advertising

In Commerce Advertising, first-party cookies have long been the cornerstone of tracking, serving two critical purposes: 1. Identifying the publisher accountable for directing users to the advertiser's store, and 2. Recording user interactions, thereafter, including clicks (CPC), product purchases (CPO), and registrations (CPA). The precise tracking parameters vary based on the publisher's compensation model, which can involve payment per order or per click. For more details on the various billing models, we have curated an overview available here.

Commerce Advertising refrains from collecting personal data or engaging in cross-website retargeting practices. As a result, it remains impervious to browser-based limitations and user-imposed restrictions like ad blockers.

Publishers prioritize identifying advertisers that can enhance their traffic monetization, while advertisers primarily seek to ascertain the publishers from which their users originate. Third-party cookies are unnecessary for obtaining this information.

Three advantages of first-party tracking at a glance

1. An exclusive data pool: The greatest advantage of first-party data is that it is obtained directly by website operators, eliminating the reliance on third parties. This allows them to expand and refine their own data pool continuously.
2. Legal certainty: Collecting and using first-party data is fully compliant with the General Data Protection Regulation (GDPR) – provided that consent has been obtained, often by the use of cookie banners. From that point onwards, there are no legal risks.
3. Respecting user privacy: Commerce Advertising abstains from using personally identifiable information (PII) of users and targets them specifically in contexts where their purchase intent is present, such as on coupon or product comparison sites. The focus is solely on the user's position in the customer journey and their interactions with the advertiser's online store (clicks, leads, purchases, etc.), as well as the publisher from which they originate.

Now is the time for Commerce Advertising

Given the current global economic climate, many companies are adopting a cautious approach, especially in the digital economy where the phase-out of third-party cookies is imminent. Significant amounts of advertising budgets are still allocated to third-party-dependent tactics like retargeting campaigns and display/banner advertising.

Before freezing their budgets, companies should consider shifting toward Commerce Advertising. Not only does it provide a secure data protection environment for advertisers and publishers, but it also ensures budget safety through clearly defined commission structures at the campaign's outset, whether it's per click, lead, or purchase. This means that every Euro or Dollar invested yields measurable and predictable performance. Additionally, Commerce Advertising offers publishers a future-proof method to monetize their traffic, especially as traditional methods like banners and native ads face challenges in the Cookiepocalypse.

A Commerce Advertising platform like mrge can bring both advertisers and publishers together, offering a diverse range of potential partners and campaigns.

What is a CSS?

Comparison Shopping Services (CSS), which have been a fixture in e-commerce and performance marketing for years, allow retailers to place ads to ensure that their products are displayed at the top of search results, giving them a strong presence in the minds of users who are ready to buy.

To run these Shopping ads, retailers need to work with CSS. Google itself acts as a CSS (called GSE = Google Shopping Europe), but there are also external CSS partners, such as the shopping24 Commerce Network offered by mrge.

When retailers use GSE as their CSS, Google retains a percentage of their advertising budget, which is deducted from the bids in the ad campaigns. This means that the advertising budget cannot be fully utilized where it generates the most value for the advertiser – in paid ads. On the other hand, if retailers use an external CSS partner such as shopping24, they are only charged a set monthly or annual fee. This allows 100 percent of the advertising budget to flow into campaigns, thus promoting the retailer’s products effectively.

Good to know: Retailers can connect product data feeds through Google’s Merchant Center to advertise products using a CPC (cost-per-click) pricing model. This is possible via any CSS, not just GSE!

5 tips for using CSS to achieve maximum reach

1. Provide a high-quality product data feed: Your product feed should give Google the data it needs, in the right format. You can get the exact details from your CSS or via the Comparison-Shopping Services Help Center. In addition, your data should always be up-to-date and contain all relevant information. An up-to-date price, for example, is mandatory. Generally speaking, high data quality and quantity improves the chances of targeting your products to the relevant target group.

2. Set yourself apart from the competition: For example, highlight your Shopping ads visually to attract more attention. A good way to do this is to add product and star ratings to your ads. 

Another option to set yourself apart is to use Merchant Promotions, which allow you to integrate special offers, such as discounts, into the Shopping ads. This way, you differentiate yourself from competitors at first glance and can secure the attention of users.

3. Choose the ideal campaign structure for your shop: To optimize your return on advertising spend (ROAS), choosing the right campaign structure is important. You should divide your products into campaigns, ad groups, and product groups in a strategic manner. For instance, you could categorize them by brand, category, and/or margin. Additionally, you must consider budget distribution and CPC allocation carefully to ensure the best results. By organizing your campaigns in this way, you can make the most of your advertising budget and achieve better ROAS.

4. Integrate remarketing lists and optimize your campaigns: This considerably boosts your chances of making a successful sale. Remarketing lets you use Shopping ads to repeatedly and specifically address users who have already visited your website. This increases the probability that they will notice and select your offer.

5. Test, test, test: Of course, there’s more than one way to become successful with CSS and Google Shopping. Every shop is different and needs a unique strategy. You should analyze and test exactly what works best for you. And even a functioning strategy should be examined and adjusted again and again. Especially in e-commerce, you should never stop testing new possibilities and trends in the shopping arena. This way, you’ll continuously optimize your performance and achieve long-term profitability.

(Re-)start now and make the most of Google Shopping

With shopping24, mrge has a CSS partner who can support you and your online shop – nationally and internationally. Whether you want to manage your own campaigns through our CSS at a fixed annual price, or also delegate the management and playout of Google Shopping campaigns: Contact us today for professional, customized advice on your goals and requirements!

What does a Commerce Advertising partnership look like?

For advertisers, Commerce Advertising is about placing digital advertising in environments that are contextually appropriate to their offering. The goal: Reaching potential customers during the purchase-relevant phases of the customer journey, and ideally achieving measurable conversions. They do this in the environments of suitable publishers, for example product and price comparison sites, as well as coupon or cashback offers. Based on the billing model, publishers are paid a commission.

Five factors for a successful partnership between advertisers and publishers

1. Fostering connection: Good chemistry between the people involved is the foundation for any good partnership. Commerce Advertising is no exception. To foster trust and transparency, a regular fixed meeting is a must. 
2. The right billing model: From cost-per-click to cost-per-order, there are various options for compensating publishers, and advertisers should choose one that suits their campaign goal. When selecting the billing model, make sure that it’s also fair and transparent for both sides, especially since many advertisers like to use dynamic models. 
3. Agile activity: Here, the social aspect factors in again. From time to time, opportunities or problems arise for one partner at short notice – issues that require the other partner to act quickly. A short response time is essential in order to avoid unpleasant situations and prevent a loss of trust. For this reason, both sides need to name a contact person right from the start. 
4. It’s not (only) about the commission: Here, again, transparency plays an important role – as do expectations. Many advertisers who generate low sales rely on performance marketing to boost their numbers, so they offer the publishers high commissions. But that usually backfires, since most publishers look for a good conversion rate. Advertisers should work to improve this area first. Once they have higher conversion rate, they will quickly find a partner – even with a lower commission. 
5. Reliable fraud detection: Do you know whether sales numbers are actually valid – and not generated by bots, for example? Commerce Advertising platforms such as mrge can support precisely this type of fraud detection. Using a different approach may not result in mutual success and, at worst, could harm the trust between parties.

Three criteria for choosing the right partner

1. What do I want to do? Of course, all advertisers should ask themselves this question when planning a campaign. Regardless of whether they want to create awareness, generate leads, or sell products directly – the right channels and measures can be defined based on their own goals. 
2. Context is king: Advertisers can narrow down the number of potential partner publishers simply by choosing the right environment. It makes no sense for an online bicycle store to consider a blog specializing in smartphones. The same applies to the publisher, who would earn less money due to fewer conversions.
3. The initial conversation: Before partners decide to join forces, it is important to meet in person and see whether the chemistry is good. In addition, open questions and the general conditions of the partnership can be clarified face to face: Where are the challenges? Where are the opportunities? And how can these be harnessed within the partnership?

Pay attention to these red flags

Just as there are signals for potentially fruitful partnerships, there are also warning signals that should immediately alert both sides. Often, a closer look at the website in question is enough: Does it look professional? And if not, does the owner nevertheless boast six- to seven-figure clicks for the site? This, in turn, could be a sign that the visitors are not real people but bots, for example.

You should also check the website’s legal notice (in Germany: Impressum). In other words, potential red flags could include incorrect or missing information, or a legal notice that appears to be a clearly pasted image.

What other stakeholders can provide support?

In the relationship between publishers and advertisers, other players are usually involved in the middle. A Commerce Advertising platform like mrge can help match up partners, for example. To return to our dating metaphor: In this case, mrge is a kind of matchmaker that uses specific criteria to find partners who are perfect for each other – and can set up an initial meeting.

Hector, what exactly does SourceKnowledge bring to mrge, what will our existing publishers and advertisers benefit from?

We are a Canada-based self-serve digital advertising campaign management platform with a strong focus and robust reporting on key metrics. We help performance marketers and e-retailers drive revenue outside the walled gardens (Google, Facebook, Amazon) and publishers to better monetize their content. With our technology, we reach new shoppers that are actively looking for products—with a strong footprint in North America. Our platform is performance and CPC-based. We are truly conversion focused and tied to RoAS goals. 

What exact tools do you provide? 

Plugging into our platform gives advertisers access to premium domain targeted traffic from our network of direct publishers in formats such as apps and plugins, in-text ads, within deal or coupon sites as well as content review sites, and lastly to social influencers, such as promotional content creators. We provide device targeting, geotargeting, daily budget caps, pay-as-you go, and advertisers can create allow lists and block lists by sub ID. In addition advertisers can use auto-optimisations in order to discover new converting subIDs in a risk-free environment.

You were founded in 2009 - what were the important milestones along the way from founding to the present day?

Prior to the founding of SourceKnowledge, me and my team met working at a search engine and started one of the first PPC advertising platforms on the internet. My role was to recruit traffic partners to syndicate our advertising.

Before our recent growth period, SourceKnowledge had its best revenue years in 2015/2016, when we were focused on programmatic video advertising. We created a self-serve interface for ad companies to run pre-roll video ads on a CPM basis. This functioned very well until two events: YouTube being removed from ADX in 2015, which removed the ability for any RTB buyer to access this pre-roll traffic, and LiveRail, the prominent video SSP at the time, being acquired by Facebook in 2014 and then shut down in 2016.

These two events ended up being an important milestone for us. Our experience in the pre-roll space taught us that it was important to rely on our own traffic supply over the walled gardens. And in general, the CPM pricing model was difficult to justify as direct performance metrics were much harder to measure. We pivoted to focusing on retail brands and shopping-based traffic that performed well off click-based attribution models. The rise of Shopify, which made the ability to create retail sites much simpler, also fed into our model. This created a Commerce Advertising solution for retail brands looking to drive an incremental lift in their marketing spend, focused on the open web.

How do you expect the performance-driven ad tech industry to evolve, what trends are the most important, in your opinion? 

Looking ahead, performance-based advertising will continue to grow as brands and agencies have an ever-expanding need to responsibly grow marketing spend coupled with an attainable return goal. Privacy concerns and the impending demise of the cookie are constricting the ability to target campaigns based on third-party data segments. Brands and agencies are going to continue to value the path to purchase and therefore invest more ad spend into the open web. As a result, publishers who produce content geared towards lower funnel activity are in a prime position to garner more competitive rates from the market. These trends will continue to loosen the grip of the walled gardens as the primary source of ad spend in the industry.

Now being part of mrge, what is your goal, and what’s your value-add to mrge?

First of all, publishers will benefit from our CPC-based payouts for better monetization. Also, our American footprint will open up advertiser opportunities within the US for mrge’s existing market partner. Last but not least, with our influencer network, we can help advertisers integrate micro-influencers into their media mix using targeted parameters.

Thanks for your time, Hector.