Maximising Your CSS Partnerships: Key Trends and Retailer Needs

SO WHAT DO RETAILERS WANT

At the heart of any successful partnership lies alignment and this holds true for retailers and their CSS providers. Firstly, retailers prioritise partners whose strategies resonate with their own. This could manifest in a focus on profitable product lines or specific categories where the retailer aims to capture greater market share. Beyond strategic alignment, retailers seek incremental value from their CSS partners. They want to see expanded coverage that goes beyond their core brand visibility, driving traffic across their entire product catalogue and ultimately boosting overall reach. 

Control is another crucial element. Retailers desire greater transparency in measurement and access to more data from their partners. The provision of insights like auction performance data, such as that offered by Connexity, empowers retailers with a clearer understanding of performance vs their competitors. 

Looking ahead, retailers are increasingly interested in diversification beyond Google. CSS partners who can tap into other effective paid traffic sources will hold a distinct advantage, offering a broader and more resilient approach to customer acquisition. Ultimately, the fundamental drivers for retailers remain growth and impact. This encompasses both achieving significant topline revenue increases and identifying opportunities for greater efficiency and cost savings wherever possible.

WHAT TRENDS DO WE SEE IN THE MARKET?

Several significant trends are reshaping the CSS landscape. One recurring theme is that retailers are often encountering a plateau in the performance of their own shopping campaigns, driven by continuously rising CPCs. Meaning that for each incremental investment in shopping ads, the returns are depreciating, leading retailers to feel they are reaching a point of saturation. 

In response to this, retailers are launching CSS partners to find the next wave of traffic growth. Assuming the same target, Connexity advertisers typically observe 25% more impression share, leading to 15-20% more click share. Something that would be impossible for the advertiser to do themselves when faced with diminishing returns   

Successful retailers are also shifting away from a sole focus on Return on Ad Spend (ROAS) as their success metric. Instead, there’s a growing adoption of profit-centric models such as Profit on Ad Spend (POAS). This subtle change in approach provides a more accurate picture of campaign efficiency, particularly when dealing with products that have varying profit margins. 

For example, when selling two sofas…. Own brand vs Designer label.The own-brand sofa costs £1000 with a 50% margin; the designer one costs £2000 and has a 20% margin. 

In the case of an ROI target of 1000%. Then the max cost to acquire the £1000 sofa is £100, whereas the max cost to acquire the designer one is £200. However, given the different margins, the POAS actual would be 500% and 200%, respectively. Assuming 200% is the POAS target, the bid for the high-margin sofa can increase significantly up to a total of £250 cost per sale, which means that retailers can effectively push for where the margin is directly. This difference is not typically possible in a ROAS or affiliate-based CPA model.      

Another significant trend is the increasing importance of enriching product feeds with first-party data. Advertisers are strategically leveraging custom labels within their feeds to enhance campaign structure and apply appropriate strategies. For instance, assigning a score or rank to products based on their predicted likelihood to sell enables CSS partners to adjust bids dynamically. Additionally, integrating data from stores, warehouse stock levels or profit margins directly into the feed allows campaigns to drive metrics beyond simple revenue generation. 

In terms of measurement, advertisers are also evolving their strategies. There’s a growing demand to utilise multiple attribution models or even develop in-house reporting platforms. Rather than solely relying on tools like GA4, retailers are exploring a more holistic view of attribution, alongside the use of even more developed techniques like Marketing Mix Modelling (MMM). For example, Google recently released Meridian, particularly liked for its open-source marketing mix modelling (MMM) tool that democratises access to advanced analytics normally only accessible by companies with deep pockets. Great for Google-related channels but the jury is out as to whether it integrates as well for advertisers with a more diverse marketing mix.  

WHAT DIFFERENTIATES CONNEXITY IN A CROWDED MARKET?

In a competitive landscape, Connexity distinguishes itself through a core focus on scale. A study involving over 300 retailers with varying investment levels revealed that, on average, Connexity delivers 25% more impression share on top of a customer’s existing campaigns. 

This significant scale exists with the help of several key pillars. Firstly, Connexity’s approach to CSS is built on a foundation of proprietary technology. As pioneers who collaborated with Google on the launch of Google Shopping in 2012, we possess an in-depth understanding of the intricacies of this space. This allows us to bypass affiliate architectures favoured by many CSS providers, allowing for complete control over bidding and spending strategies. Transparency and alignment with advertisers are also incredibly important. 

Connexity prioritises internal attribution data as the “source of truth”, while also seamlessly integrating with external analytics platforms like GA4 and Adobe. This approach positions us as a natural partner for search and paid media teams. Beyond their core CSS capabilities, Connexity is committed to diversification and strategic partnerships. 

Jon Lord, VP of Business Development, said, “Google traffic is important and we are experts in delivering it, but we want to diversify the mix for our customers too. We have actively expanded our traffic sources to encompass emerging channels such as Creators, Taboola Dynamic Ads, and Commerce Content, ensuring incremental reach and the acquisition of new customers.” 

Finally, the platform offers the flexibility to accommodate a wide array of commercial strategies, both in terms of product focus and payment models.

If you’d like to find out more about how we could help your business, reach out to the team here.