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Advertising performance and user experience: towards a reconciliation?

In recent years, digital marketing has undergone a period of rapid transformation, marked by significant technological innovation and constantly evolving consumer behavior. The digital advertising market is no exception to this trend.

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On the one hand, paid media traffic teams focus on the technological innovations that are redefining online advertising, driven by giants like Google and Meta on the ad-centric side.

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At the same time, website teams are striving toimprove the user experience in order to boost conversion and engagement rates on the site-centric side.

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However, despite this progress, insufficient collaboration between these two spheres creates operational silos that hamper the effectiveness of digital acquisition strategies.

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This compartmentalization, often accentuated by divergent technologies, varied KPIs and distinct challenges, calls for a more integrated approach.

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This article explores how to break down these barriers to achieve greater synergy, looking at strategies that could unite these parallel worlds in a concerted effort to optimize both advertising performance and user experience.

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The evolution of advertising performance and its impact on CPC

Digital advertising has undergone major transformations, particularly dominated by Google and Meta. Today, for every three euros spent on advertising, two euros end up in the coffers of these giants, according to the December 2023 SRI Barometer.

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Although platforms such as Amazon Ads, TikTok and Pinterest are also evolving, Google and Meta remain the pillars of digital advertising.

barometer-digital-advertising-a

Source: 31st edition of the Observatoire de l'e-pub Oliver Wyman/SRI/UDECAM

Google also has the highest growth rate over the year 2023, according to the December 23 SRI Barometer studies.

Source: 31st edition of the Observatoire de l'e-pub Β© Oliver Wyman/SRI/UDECAM

The age of automation on Google Ads:

In the late 2010s, Google initiated significant changes with the introduction of Smart Bidding, culminating in Google Performance Max.

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This innovation marks a significant departure from traditional methods of Search Engine Advertising, or SEA. In the past, advertisers had to manually select keywords, set CPCs, choose budgets and configure landing pages.

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The Google Ads interface of yesteryear resembled an airplane cockpit, where every aspect of the campaign required manual management and detailed strategic decisions.

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In contrast, today's model with Performance Max is fully automated. Advertisers no longer have to worry about keywords, CPCs or landing pages - these elements are now managed by Google's algorithm.

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Meta and Advantage Plus:

Meta has followed a similar trajectory with Advantage Plus, automating many aspects of ad configuration to maximize campaign effectiveness according to advertiser-defined objectives.

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How to optimize advertising effectiveness in the age of AI and automated ads?

As with many topics in digital marketing, the key is data.

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Thestrategic use of data from your CRM and Analytics tools is crucial to refining the effectiveness of your marketing campaigns.

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This first-party data, also known as 1P or proprietary data, is all the more relevant today for creating an exchange of value with your audiences. In exchange for their consent, you can collect essential data that will help you better understand and engage your customers.

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The arrival of the Digital Marketing Act (DMA) underlines the importance of these practices.

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This European regulation aims to strengthen transparency and control of data by users, limiting the use of third-party data and pushing companies to invest more in the ethical collection and use of first-party data.

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With the DMA and the disappearance of third-party cookies, it is becoming imperative for brands to build marketing strategies based on a relationship of trust and transparency, where the protection of personal data is a priority.

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E-tailers now need to adopt a more frugal and ethical approach to data exploitation, focusing on less but better.

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πŸ‘‰ Learn more about the impact of DMA on advertisers in this article on the DataΓ―ads blog.

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By using first-party data to feed your algorithms, you can predict the future and identify the audiences most likely to convert, thus increasing advertising effectiveness.

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Despite these efforts, it's important to note that cost-per-click (CPC) has tended to increase in recent years, according to 71% of e-tailers surveyed by DataΓ―ads.

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Between March 2023 and March 2024, the average CPC rose by around 10%, with significant increases in sectors such as DIY and home. This trend can be explained by several factors:Β 

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  1. Market concentration: In an environment where a few players dominate, prices tend to be high, making it difficult to manage advertising costs.
  2. Maturity of first-party data : Although the use of first-party data is progressing, there are still many opportunities for improvement, particularly with regard to the quality of product feeds, where there are still many areas for optimization.
  1. Increased competition : The emergence of new players, particularly from Asia such as Temu, Shein and Aliexpress, has intensified competition, driving CPCs up in many markets.

Here are the challenges and changes facing the ad-centric side. Now let's look at the user experience, or site-centric, side.Β 

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πŸ‘‰ Discover the advice of our partner Feed Manager, experts in Product feed Management, in this webinar replay.

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Inertia of the on-site user experience and stagnating conversion rates

Although websites, and especially e-commerce sites, have evolved considerably over the last 15 years thanks to technological advances, they are often faced with inertia due to the rigidity of CMS and the increased bandwidth required on the IT side when it comes to making optimizations.

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In response to the need to adapt quickly to changes in user behavior, a number of overlays have been developed to bring greater flexibility and performance to e-commerce teams.

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  1. Among them, conversion rate optimization (CRO) tools enable on-site personalization, although they can be costly and can weigh down pages due to their superficial integration, which doesn't always attract the attention of media teams.
  2. On-site recommendation and search tools, despite their complex integration, often lack a holistic vision of the customer experience (CX).

While these solutions can improve the overall conversion rate of an e-commerce site, are they really enough?

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‍Ourstudies, surveying around 400 merchants annually, show that the average conversion rate remains around 1% (2023), a figure that has unfortunately remained constant for years.

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This stagnation could be explained by increased competition and the growing sophistication of online consumers, who are better equipped and more informed.

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Looking in more detail at traffic from digital advertising, which often represents 50% of a site's total traffic, conversion rates are even lower, often less than 1%. This highlights the fact that, although conversion is crucial, it is often overlooked in the media context.

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Faced with this overall increase in CPC and stagnating conversion rates on site, we're seeing an increase in acquisition costs, which underlines the purpose of this article.

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The aim is to bring together these two highly complementary worlds: user experience optimization and traffic acquisition optimization. This collaboration is essential, even mandatory, given the increasingly limited optimization possibilities offered by advertising platforms, as mentioned in the previous section.

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In the majority of large companies, 90% of cases show that acquisition and e-commerce teams operate separately, with different objectives, tools and partners.

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This lack of collaboration, especially in a market under pressure, needs to be addressed to improve value creation.

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Developments in Google and Meta ad formats should theoretically accelerate this necessary collaboration.

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This division can prevent the effective integration of strategies that optimize both acquisition and user experience, underlining the need to restructure these interactions to improve overall performance.

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Reinventing user engagement with advertising traffic: Media-Site synergy and the post-click experience

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With the emergence of product formats on advertising platforms, which can account for up to 90% of advertising investment, the user journey has changed considerably.

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Let's take an example: if a web surfer wanted to buy a new pair of shoes, he or she could type "buy men's/women's shoes" into Google.

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Without specifying the price or type of material, Google will automatically choose a page from the catalog of one of the thousands of advertisers to promote in the results. Once on the product page, the drama begins for the e-tailer: a single product is presented, with perhaps a few similar options underneath.

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Most of the time, users return to the search engine to continue their research with competitors. In fact, our data shows that 7 out of 10 users who click on a Google Shopping ad return to the original platform to click on other ads, often from other merchants.

We call this phenomenon"fitting-room syndrome".

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It's as if, when you enter a store via an advertisement, you're led straight to a fitting room with only the item in question.

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If you'd like to see other products, the easiest solution is to go out and return to the mall and check out competing stores.

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To solve this problem, at Dataiads, we create a synergy between the media and the e-commerce site with our technology.

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Using AI, our platform generates pages designed to better welcome visitors to the paid channel, with the simultaneous creation of one to four different pages, adapted to the user's context, such as platform or category of origin.

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This approach does not require any major IT intervention, but simply a sub-domain delegation. And more importantly, while using first-party data thanks to a simple connection to a product feed.

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The platform doesn't touch the site, and makes acquisitions teams happy: no time spent on IT, and plenty of time to generate personalized, high-performance post-click experiences.

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Thanks to our digital marketing and CRO experts, or our dear media scientists, we work on the UX, integrating navigation keys, enhancing and testing different calls to action (CTA) through A/B tests.

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We also improve product recommendation via algorithms that suggest similar or complementary items, and we optimize page load times and core web vitals.

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An example of how DataΓ―ads technology works: the case of L'Occitane

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Finally, once we've improved the welcome on these pages, we redirect the traffic back to the main site. This practice, which we call the Post Click Experience, creates a new category in e-commerce and digital marketing, reconciling the ad-centric and site-centric worlds.

Discover how Darty increased its Google Shopping ROAS by 28% with DataΓ―ads, while reconciling acquisition and conversion optimization on site.

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* * * * *

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The two worlds, ad-centric and site-centric, need to find common ground to maximize not only ad spend but also user engagement and conversion rates.

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Innovations like the Post Click Experience illustrate the potential of a successful synergy, where advertising technologies and strategies are integrated with targeted improvements to the user experience to create a more coherent and satisfying customer journey.

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This integration requires not only a technological evolution, but also a change of mindset and organizational culture. By breaking down barriers between teams, sharing knowledge and aligning objectives, companies can truly transform today's challenges into opportunities for a more connected, high-performance future.

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By effectively reconciling these seemingly disparate fields, we can look forward to an era of digital marketing where advertising performance and user experience march hand in hand towards greater efficiency and enhanced customer satisfaction.

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