AdRoll and Magento Commerce announced a partnership on Friday to combine the companies’ ecommerce platforms, incorporating AdRoll’s ad targeting and attribution directly into the Magento cloud management service for online sellers.
Bay Alarm Medical, which sells medical alert systems, has been working with Magento for four years and with AdRoll for almost a decade, said Alan Wu, the company’s director of sales and marketing, and this integration between the two platforms is important because Bay Alarm Medical needs a more robust ecommerce platform.
Bay Alarm Medical is developing multitouch attribution modeling, which becomes more important as the company adds to its marketing budget and media channels, Wu said.
Multitouch attribution is often thought of as a bane to retargeting, since the goal is usually to distribute credit up the consumer funnel instead of just paying the company that drove the final click.
Wu said the Bay Alarm Medical now evaluates “blended costs of media” as it grows into more expensive media channels, like YouTube videos or prospecting. But retargeting is still critical, he said, because the media is relatively cheap and the company has, presumably, already paid handsomely to drive brand recognition and get a new visitor to the site.
AdRoll will give a portion of its performance marketing fee to Magento when shared customers drive a sale using its advertising technology. AdRoll hopes to make up for that small loss in profit margin through increased stickiness with early stage ecommerce companies.
There’s a life cycle wave for ecommerce startups that retargeting and ecommerce vendors can ride profitably. They need to sell into a small merchant with growth potential and take off with the business – until the seller hires and builds out its own data-driven marketing operation.
“Capturing early stage companies as they’re accelerating has always been critical to our business,” said AdRoll President Scott Gifis.
On top of its cut of driven sales AdRoll also benefits as clients bump up to higher-paying tiers or try out pricier products like prospecting and attribution.
For AdRoll, even if retargeting takes a back seat, its attribution technology and other services, like a data co-op for online sellers, allow it to naturally move up the value chain as an ecommerce client matures.
Even small ecommerce merchants are sitting on “rich, powerful first-party data,” Gifis said, and hitching the company to that data, as opposed to just ad retargeting applications, is where there’s long-term value for the company.
