Twitter amplifies ad offering
Placing ads in tweets just got easier and more precise for retailers.
It will probably not have the same impact on social commerce as Twitter’s recent introduction of a Buy Now button, but the social platform is opening its Amplify ad program. In a beta offering, Twitter is letting advertisers select content categories and audiences they want to target with preroll video ads.
Twitter automatically and dynamically places the ads into embedded videos tweeted by publishers, with the publisher receiving most of the ad revenue through an automated revenue-sharing arrangement. The main difference from the traditional Amplify format is that advertisers no longer have to partner with a specific publisher to get their preroll ad placed.
Twitter plans to expand the new, more open Amplify out of beta both in the U.S. and globally. For retailers, this is a chance to target their ads more precisely based on video content and additional audience targeting, rather than by general audience demographics of a specific publisher.
More granular targeting should lead to more customer engagement and ultimately more sales, especially with the new Buy Now button that lets consumers make purchases without having to leave Twitter.
Study: E-commerce keeps growing
The retail revolution may not be televised, but it will be digitized.
The new Q3 E-commerce Pulse from predictive analytics platform provider Custora shows that e-commerce revenue grew a healthy 11.8% year-over-year in third quarter 2015. E-commerce transactions rose an almost identical 11.6%.
Mobile continued to grow in significance as a channel for e-commerce in the quarter. Phones and tablets made up a combined 28.7% of e-commerce transactions, up from 23.1% of orders during the same time the prior year.
Apple’s iOS continues to be the platform of choice for mobile shoppers, taking 76.9% of the order share. However, Android’s stake climbed to 22.7%, up 16% from 19.5%.
Organic search was once again the leading driver of e-commerce purchases bringing in 22.5% of orders. Paid search ads and affiliate marketing both saw significant increases for each channel. Paid search moved up to 19.3% from 16.4% and affiliate marketing jumping to 16.7% from 12.1%.
Social media (including Facebook, Twitter, Instagram, and Pinterest) continued to have a minor impact as an e-commerce purchase driver, only accounting for 1.5% of total volume.
However, a recent rash of new direct social selling tools such as the Twitter Buy Now button, expanded Pinterest Buyable Pins and YouTube shoppable ads may enhance social media’s influence on e-commerce purchases in coming quarters.
Aeropostale finds new way to make money
Aeropostale believes its brand is strong enough that shoppers at other retail outlets will want to buy licensed products bearing its name.
The teen specialty retailer and operator of roughly 800 stores signed a domestic licensing agreement for home textiles with Himatsingka America. Terms of the deal call for Himatsingka to design, manufacture and distribute bedding and bath linens using the Aeropostale label for department stores, big-box retailers and wholesale channels across North America.
“We look forward to capitalizing on the power of the Aeropostale brand to expand our reach through new bedding and bath products,” said Julian Geiger, Aeropostale CEO. “Himatsingka America has a strong portfolio of brands and proven track record, and we look forward to working with them to reach new customers across new channels."
Aeropostale needs to reach more customers since sales at its own stores have been weak and losses are mounting. In the second quarter, same-store sales declined 8% on top of a prior year decline of 13%. The comp decline and closure of 23 stores caused total sales to fall 17% to $327 million. The company reported a net loss of $43.7 million, or 55 cents a share.
While Geiger characterized the quarter as, “an important transitional time,” the company has been rejiggering its finances to buy time to restore growth to the once-hot brand. The retailer had cash and equivalents of $86.5 million and $142.7 million in long-term debt at the end of the second quarter. However, it recently closed on a $215 million amended credit facility that doesn’t expire until February 2019.
Despite some financial breathing room, investors aren’t impressed. The company’s share price has traded at less than $1 for more than a month putting it in violation of the New York Stock Exchange listing requirements and prompting discussion of a reverse stock split. Doing so could bring the company in compliance with the NYSE’s listing requirements while it continues to address underlying business issues.
The new relationship with Himatsingka may not provide an immediate benefit to Aeropostale’s financials since product isn’t due to go on sale until the 2016 back to school season. Even then, the impact is unclear since payments under such licensing deals are typically based on achieving sales volume targets.
“We intend to engage Aeropostale's vast customer base with an exciting new home offering. We share their passion for creative design and quality workmanship and look forward to a meaningful relationship,” said David Greenstein, CEO of Himatsingka.