When you think about the internet, your mind probably goes to the websites you frequent the most: Facebook. Google. Amazon. These are the places that effectively dominate the online e-commerce experience today, and as such, they’re the places where digital marketing and advertising live in the present day. As a matter of fact, these big brand names represented 65% of the total ad spend and up to 90% of the industry’s annual growth in 2016 — and it’s only been an upward journey in the years since.
Because these sites have such a stronghold on digital marketing and advertising, you’d think that they were also the most accessible places, as well. In truth, though, these sites are what’s known as a walled garden: a closed online ecosystem that subtly takes control of the user’s experience, guiding them toward specific content or services and away from others. The solution to these walled gardens — the way around them, so to speak — is the open web. You need it more than you might think.
In direct contrast with the walled gardens of the internet, the open web is the place where all the other, smaller digital marketing and advertising can exist and compete in a more democratic, more fair environment. Away from the big brand names that curate and manipulate results to suit themselves and shun the competition, both ideas and money can flow a lot more freely. In all honesty, the difference between digital marketing and advertising behind a walled garden and on the open web is as drastic as night and day. This isn’t just an opinion — it’s a matter of simple economics. Just look at the law of diminishing returns.
In economics, there’s a theory called the law of diminishing marginal returns. This law hypothesizes that, after a certain capacity is reached, the addition of an extra factor of production will ultimately result in less output, not more. If you apply this to advertising and e-commerce, it’s easy to see why digital marketing behind one of these aforementioned walled gardens could prove problematic. Because such a substantial percentage of advertising exists on these sites, you’re likely spending money on ads that aren’t going to do anything for your business because that capacity has already been reached.
In reality, this boils down to not being as efficient with your ad budget. It’s important to be as efficient with your last dollar as with your first dollar, and the law of diminishing marginal returns tells us it makes a lot more sense to invest in ad spend on the open web instead of behind walled gardens. Not to mention, the open web gives you the opportunity to test out other methods and vendors at a much more cost-effective rate, allowing you to grow revenue much faster than you would’ve with higher ad spend on a more crowded, less democratic website. The current trajectory of e-commerce reaffirms this.
Throughout the course of the COVID-19 pandemic, the trajectory of e-commerce has been incredibly positive. This trajectory was strong before the onset of coronavirus, but with so many consumers heading to the internet in the wake of lockdowns and restrictions on in-person retail both essential and nonessential alike, e-commerce saw an additional $105 billion added to the mix in revenue in 2020 alone. This took online sales to a whopping $791.7 billion for the year, up 32.4% from 2019’s $598 billion.
With e-commerce booming as of late, now is the time to explore and experiment with digital marketing and advertising on the open web. With the help of SourceKnowledge and the testing of new methods and vendors, it’s currently easier than ever to grow revenue by investing in a wider variety of advertisements and promotions on the open web and away from walled gardens. Call it casting a wider net.
Anyone with an e-commerce store knows the importance of attracting new customers, and casting a wider net during the current e-commerce boom can make this easier than ever before. It starts by pursuing new customers outside the parameters of walled gardens and searching the open web instead. You can also grow your business with methods like low funnel marketing and conversion, which involves targeting people you know are on the brink of becoming customers. Whether they have something in their cart or are searching the web for your business or product or service by name, low funnel marketing and conversion (in combination with casting a wider net on the open web) can make an enormous difference for your company.
At the end of the day, casting a wider net on the open web instead of pursuing diminishing returns behind walled gardens will help grow your business like never before. Don’t be afraid to experiment with new vendors out there on the open web, don’t be unwilling to test out new strategies, don’t be afraid to pursue more variety — the potential to grow revenue is just too great to neglect the many possibilities of the open web.
If you still have questions about how the open web will help grow your business, reach out to SourceKnowledge. The SourceKnowledge team assists e-commerce businesses turn their catalogs into shopping feeds, allowing them to more easily access in-market shoppers out on the open web and away from walled gardens.
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