Overture CEO Ted Meisel preached the power of search engine marketing (SEM) in a keynote at the Jupiter/ClickZ Ad Forum this week. Many in the audience belonged to the converted. They’ve been using paid search, or helping others to tap its power, for years. Meisel shared data that indicates search is by far the most prevalent online activity that precedes a purchase decision. Mainstream marketers are taking notice and experimenting with search marketing. More often than not, they’re pleased with the results.
Search marketing plays a growing role for catalog merchants and retailers who want to build online presences, drive revenues through their sites, and support offline activities.
Pick a product. Chances are, a host of merchants are active in paid placement and paid inclusion, fighting for a share of valuable search traffic. Like many direct marketers with a strong online presence, Christine Aguilera, CFO/general counsel at SkyMall, and Theresa McMullen, SkyMall’s director of marketing, are successfully testing SEM.
They’re cautious, testing every media that can be tested before allocating resources. Only media that deliver buyers under the allowable cost per order (CPO) are renewed. The products, sold through the catalog and on the site, are often from brand name catalogs: Hammacher Schlemmer, Plow & Hearth, Sharper Image, and others. They’re presented in a combined format. To avoid conflicts, SkyMall doesn’t bid on brand names in the search engines. Instead it focuses on products and product categories. As with other catalog merchants, the Web is a great place to expand the number of stock keeping units (SKUs) with no incremental cost, unlike printed catalogs where space is limited.
John Rogers, Orvis’ director of online marketing, is so on top of his game he won four Catalog Age awards and the Silver I.Merchant award. When I spoke with Rogers about search strategies, tactics, and campaigns, he shared wisdom other marketers should heed. Orvis factors in lifetime value when setting campaign objectives. It recognizes not all shoppers are alike. Rogers uses information about shopping patterns to differentiate Web from catalog shoppers and parses customers by product segment. Not every visitor is ready to purchase immediately. Some are in an earlier stage of the buying cycle. That doesn’t make their visits worthless.
With so many marketers diving into search, the search industry needs to get more of them up to speed on best practices to take search marketing to the next level. This will benefit everyone in the long term. The best marketers who have the best products or services, pricing, sites, and operations are often the ones who can afford to be at the top in paid placement search. These are the same companies customers buy from every day in retail and catalog environments. One way to bring less adventurous (but highly capable) marketers into the fold is to share best practices. Each marketer who has had success in paid placement search has her own strategy, but some themes repeat themselves. These are the best e-tail practices:
- Use organic and paid SEM. Marketers understand although organic (unpaid) search traffic can be unpredictable, the CPC price is right. Don’t discount costs associated with making a site search engine friendly.
- Share campaign information across organic and paid campaigns. Keywords that work well (for traffic volume, conversion percentage, or return on investment (ROI)) in one type of search marketing often have equal or better potential in the other. For example, a site that sells a particular brand and model of laptop via paid search and gets strong volume should probably generate spider-friendly content for that item and related keywords.
- Use the right search marketing measurement or campaign management tools, and use them intelligently.
- Use paid placement and paid inclusion. In addition to obvious, highly competitive paid placement venues, paid inclusion will reward sites for relevant content.
- Go broad with keywords. Test and optimize the broadest possible keyword and key phrase list your campaign management software can accommodate in paid placement. Using broader, more targeted keywords and key phrases increases ROI.
- Test all major traffic sources. Portals sell inventory both directly and through the networks. Once you understand what’s likely to work, explore additional traffic sources.
- Measure shopping cart size by listing and compare to expected averages. When setting targets for customer acquisition costs, an expectation for an average number of units sold or shopping cart size may be assumed. Check those assumptions with data.
- Know your profitable products. Some products are loss leaders, others contribute to the bottom line. Know the difference.
- Factor in lifetime value. Understand long-term customer dynamics, and use that understanding when setting campaign goals.
- Manage campaigns as close to real time as possible for each engine and listing. Not all keywords in all engines require constant attention, but some need fairly regular checking. Use tools, services, and techniques to lessen the burden of manual management.
- Understand how search creative affects click volume and click quality, as measured by post-click behavior.
- Don’t discount the buying cycle when calculating paid search ROI.
Many best practices for e-tailers apply to business-to-business (B2B) and service companies. To immerse yourself in SEM best practices, you might consider attending the Jupiter Search Engine Strategies conference in San Jose next month. Hope to see you there!
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