Catalog & DPA - An Untapped Creative Opportunity
Finding a creative arbitrage opportunity in a traditionally unbranded ad format.
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Bottom Line:
DPA as an ad format remains a huge whitespace for advertisers to flex creativity, even in its current form, as many advertisers run extremely homogeneous, unbranded DPAs. As the ad unit matures and supports more sophisticated creative functionality like video, it will become one of the most powerful ad units for advertisers to combine product focused creative with machine learning. As Catalog powered commerce surfaces like in-app Shops or Shoppable Video continue to expand as a go to destination for users to discover, search, browse, and buy, there will be further importance on expressing brand identity through the Catalog, and creative advertisers will find ways to ‘own the format.’
When Dynamic Ads was released in 2015, it quickly became one of the fastest growing ad formats on Facebook. Advertisers with huge product catalogs like Nike, Sephora, Walmart, etc. could finally automatically pull in data and images from a product feed and populate them into a product focused ad unit.
Combined with the Catalog Sales or Conversion Objective, advertisers could access machine learning and signals to serve personalized product specific ad units to users based on relevancy, likelihood to purchase, or previous activity like Product Page View or Add to Cart.
Unsurprisingly, Dynamic Ads were extremely effective at driving direct response marketing outcomes and quickly became one of the fastest growing ad units for consumer products advertisers. Today, Dynamic Ads has been expanded and modified to serve industry specific needs like Automotive Inventory Ads and Facebook Travel Ads. The powered ad format itself also has seen some new variations and features, like Collections, Dynamic Ad Categories, Offers, and Slideshow.
Underpinning Dynamic Ads is the Catalog, which is connected to an advertisers product feed, allowing advertisers to automatically update pricing, inventory availability, products, and other information in their ads whenever these fields are updated in their own backend. This is incredibly powerful for advertisers like Airbnb who have real time changes to pricing and availability, and for marketplaces like Wish who manage huge, frequently product assortments.
Off Facebook, we see Dynamic Ads and other product feed integrated ad unit variants appear as a natural way to overlay product ads on top of other media surfaces, namely video, to create shoppable video ads or shoppable organic content.
Other ad platforms have followed - Snapchat released Shoppable Ads in 2018, Pinterest has both Shopping Ads and Personalized Collections Ads, Google has expanded their Shopping Ads to Youtube in 2019 and to Gmail in 2020, and even TikTok has rolled out shoppable ads to monetize viral videos.
Despite huge growth in adoption and use across multiple verticals, Catalogs are in their nascency as a canvas for creative and brand identity. Catalogs originate as product feeds, which are built to support product pages in eCommerce stores, leading to an overwhelming majority of homogenous and unbranded dynamic product ads with product images on a solid color background (usually white).
Some brands have temporarily used DPA formats like Carousel to showcase branded product cards, like the Nike ID example below:
While these can be challenging to scale due to the lack of Catalog creative solutions in the market today, compare this Dynamic Ad unit to the unbranded, white branded ad unit at the top. Instagram users are scrolling an average of 300 feet a day on a 5 inch screen, and advertisers are pulling out every stop to make static image and video ads eye-popping, colorful, and attention grabbing. Production of these ads are expensive and difficult to scale across entire product catalogs or product sets, yet the relative investment towards Catalog creative is tiny in comparison.
Advertising in an environment that is saturated with ads requires your ad creative to stand out. It doesn’t matter how much the product, service, or story resonates if the ad is never noticed to begin with. When the vast majority of advertisers are running identical looking dynamic product ads - there is opportunity for both the advertiser and the service providers to fill that whitespace.
Do you have some great examples of advertisers that are taking advantage of the Dynamic Ads format to showcase their brand in a unique way? Let me know!