Poshmark Advertising Case Study: 43% Increase in Seller Sales with Sponsored Listings

‍At a glance: Poshmark partnered with Topsort to build flexible, API-first advertising infrastructure for Promoted Closet. With sponsored listings, real-time reporting, auto-bidding, and Bidless™ technology, Poshmark supported 1,000+ sellers, achieving a 43% increase in sales, 3.8x ROAS, and 80% higher ad engagement.

Poshmark’s Objectives

Poshmark, a prominent fashion resale e-commerce marketplace powered by a community of over 130 million buyers and sellers, recognized the opportunity to monetize their platform further by starting an advertising business. They sought innovative solutions to empower their sellers to achieve incremental sales growth and expand their businesses.

Poshmark was looking to build its ads infrastructure and required a flexible system capable of managing their diverse inventory with an API-first solution, allowing them to design the entire platform and functionality. Their priority was to find a solution that maximized ad revenue while complementing the platform's core values, focusing on user experience and seller empowerment.

What Topsort Delivered

Poshmark selected Topsort as their strategic partner due to Topsort's proven track record in developing tailored solutions for complex marketplaces. Unlike its competitors, Topsort offered personalized attention and a deep understanding of Poshmark's unique requirements. Adi Thacker, Poshmark’s VP of Monetization, emphasized the importance of flexibility in revenue generation, a feature Topsort seamlessly delivered.

“The knowledge of the people who would work with us was the distinguishing factor,” said Adi Thacker.

The strong relationships developed with the Poshmark team have allowed the partnership to thrive.

“The accessibility and willingness to help is something that is really unique from my perspective… You can see how casual we are, but also the depth of the conversations we get into; it doesn't feel like there's a company divide between us and them,” added Adi Thacker, GM and Vice President, Monetization / Ads.

Topsort facilitated a smooth integration process that supported Poshmark’s complex catalog on a timeline that met their goals.

“Topsort’s expertise in AI and machine learning brought cutting-edge solutions to life, helping us deliver personalized, high-performing tools that drive significant revenue growth. The seamless integration and collaborative approach have truly elevated our advertising infrastructure to the next level,” said Adi Thacker, GM and Vice President, Monetization / Ads.

Custom Solutions Integral to Poshmark’s Success

Custom AI Model

Poshmark's long tail of unique items presented a challenge for standard algorithms that rely on a product's purchase history. Topsort developed a custom machine learning model based on organic data, tailored to Poshmark’s catalog. This enabled sellers to use Topsort’s Bidless™ technology, reducing the need for manual bidding.

Custom Ranking Function with Relevance Signals

To ensure the new auction feature enhanced user experience and did not displace organic ad revenue, Topsort created a special auction ranking method. This model promoted ads only in instances of incremental outcomes for revenue gains or product relevancy.

Halo Attribution

This new form of attribution expands the evaluation boundary to include indirect effects of ads, recognizing that initial ad engagement can lead customers to purchase other items from the same brand or explore a seller’s entire catalog. This comprehensive view enhances decision-making and strategic planning by uncovering significant impacts on consumer behavior and overall sales.

How Promoted Closet Works

Promoted Closet functions similarly to cost-per-click models on platforms like Etsy, Amazon, and Google Ads. Sellers can set a weekly budget and only get charged when a shopper clicks on a promoted listing. Sellers have the option to set the budget manually or get a recommendation from Poshmark, which takes into account several attributes such as the size of the seller's closet.

Sellers also have access to a comprehensive analytics dashboard where they can see the number of impressions, clicks, sales, return on ad spend, cost per click, and click-through rate.

Poshmark launched Promoted Closet in 2023, with an average 43% increase in sales and 80% higher engagement for Poshmark sellers.

Frequently Asked Questions

What is Poshmark Promoted Closet?

Promoted Closet is Poshmark’s advertising product that allows sellers to promote listings using a cost-per-click model. Sellers set a weekly budget and are charged when a shopper clicks on a promoted listing.

How does Poshmark advertising work for sellers?

Poshmark sellers can use Promoted Closet to promote listings, set weekly budgets, and access reporting on impressions, clicks, sales, ROAS, CPC, and click-through rate.

What results did Poshmark sellers see with Promoted Closet?

Poshmark sellers saw an average 43% increase in sales, 3.8x ROAS, and 80% higher ad engagement.

How did Topsort support Poshmark’s advertising infrastructure?

Topsort supported Poshmark with API-first advertising infrastructure, sponsored listings, real-time reporting, auto-bidding, Bidless™ technology, custom AI models, custom ranking, and halo attribution.

What does an impression mean in Poshmark Promoted Closet reporting?

An impression means a promoted listing was shown to a shopper. In Promoted Closet reporting, sellers can view impressions alongside clicks, sales, ROAS, CPC, and click-through rate.