Retail PPC Secrets - Pete Whitmarsh - IRX 2015
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Transcript of Retail PPC Secrets - Pete Whitmarsh - IRX 2015
© Search Laboratory Ltd 2014. All rights reserved.
Leeds T: +44 113 212 1211
London T: +44 207 147 9980
Retail PPC (is hard!)
IRX 2015Pete Whitmarsh – 25/03/15
Intro – aka. Why should I care?
0
500
1000
1500
2000
2500
3000
2007 2008 2009 2010 2011 2012 2013 2014
Annual Number of Searches (Billion)
Annual Number of Searches (Billion)
Total % of clicks to paid
20.00%
22.00%
24.00%
26.00%
28.00%
30.00%
32.00%
34.00%
36.00%
2009 2010 2011 2012 2013 2014
Text Ad + PLA Click-Through Rate
Text Ad Click-Through Rate
Which position?
Top 3 are important
CTR on lower positions
decreasing
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
2009 2010 2011 2012 2013 2014
Click-Through Rate in Paid Positions
Position 1-3
Position 4+
Target setting
AOV = £60
Average margin = 30%
Average profit per sale = £18
CPA target = £15
Product AOV Margin Profit per Sale
A £30 30% £9
B £60 20% £12
C £90 40% £36
Target setting
Don’t use CPA as a target
(Unless you only have one product)
…or number of clicks, conversions etc.
ROI / ROAS / Cost of sale
Average margin = 30%
Target Cost of Sale = 25%
Target ROAS = 400%
Product AOV Margin Profit per Sale
A £30 30% £9
B £60 20% £12
C £90 40% £36
Target ROAS / ROI
Can be used…
…but only if you have a static
margin
Encourages lower volume RO
I
Spend
Pro
fit
Spend
Profit
Profit increases to a point
Hard to know what shape
this curve is
Ultimate goal is to find the
point of diminishing returns
Point of diminishing
returns
Profit
The best measure of success
Give your agency the right data to provide this
– Cost price of items
– Margins per item
If possible, don’t cap the budget
Valuing clicks
Understand the value of every click
Core principle of PPC
Simplest form…
𝑃𝑟𝑜𝑓𝑖𝑡 𝑝𝑒𝑟 𝑠𝑎𝑙𝑒 × 𝐶𝑜𝑛𝑣𝑒𝑟𝑠𝑖𝑜𝑛 𝑟𝑎𝑡𝑒 = 𝐶𝑙𝑖𝑐𝑘 𝑝𝑟𝑖𝑐𝑒
The bidding problem
What is the conversion rate of a
keyword with 1 conversion from 10
clicks?
Only 95% sure that the Conversion Rate is
between 0.25% and 44.5%
The bidding problem
Determining the conversion rate on broad high-volume terms is easy
The problem occurs in low-volume long tailed terms
Solution:
– Look to other similar terms
What else influences conversion rate?
Time
Season
Location
Device
Weather
Previous visits to site
Make suitable adjustments to take advantage of this
Time of day
Opportunity to adjust bids based on performance
0
5
10
15
20
25
30
35
40
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23
Conversion rate Average Conversion Value
The full value of a click
Understand the full value of a click by considering
– Paths to other campaigns or channels
– Lifetime value
– In store visits
– Cross device conversions
– Referrals
– Brand awareness
– Micro conversions
– Returns
Consider
Different levels of keywords
Men’s Shoes
Men’s smart shoes
Men’s black
leather shoes
Men’s black Ted
Baker shoes
Ted Baker MARTT
shoes black
MARTT shoes
Ted Baker
black lace
ups
Men’s black
derby shoes
Size 9
designer
shoes
Men’s
dress
shoes
What happens when…
Price changes?
Product goes out of stock?
Product comes back in stock?
Product gets renamed?
URL changes?
New colour gets released?
What happens when…
Minimum price changes?
Minimum priced item goes out of stock?
New cheapest item?
Range decreases to 4?
The problem of scale
Granularity is easy for a small set of products, but…
We often have a colossal number of potential Ad Groups
Keeping up-to-date is a difficult problem
How do we solve it?
More people or less granularity?
Equivalently:
– More operating costs or lower return?
How about a third option…
Creation
Updating
BiddingError
checking
Integration
AutomationKeywords
Ads
Ad groups
Campaigns
Prices
Stock
Sales
Pauses
Keyword-level
Structured
Mathematical
Double checks
Manual & automated
Ad platform API
Bidding on brand
Do you…
– Bid on brand terms?
– Avoid brand terms?
– Test whether it actually makes a difference?
Brand bidding
Our methodology
– 20 minute randomised
intervals
– Paid vs Organic report
Recent results:
Queries Clicks CTR
Both shown 16525 15004 91%
Organic Only 26129 19020 73%
Increase in CTR 18%
Extra Clicks as a Result of PPC Ads 2975
Total Cost £990.07
Cost per EXTRA click £0.33
PLAs
Top recommendations
– Get your title right
– High quality images
– Keep feed up-to-date
– Normalise colour terms
– Calculate your bids
– Split brand and non-brand
– Use negative keywords
– Consider the competition
Considerations
Website:
– Local payment methods
– Localised address fields
PPC accounts:
– Research how people search
– Research what messages people respond to
– Research what competitors are doing
Make sure you get it right…
Don’t just translate
People search differently
People respond to different
messages
…Even in English
Pants / trousers
Thongs / flip-flops
Sneakers / trainers
Sweaters / jumpers
Court Shoes / pumps
Braces / suspenders
Vest / waistcoat
Takeaways
Paid search is still growing
Pick sensible targets – not CPA
Calculate bids and bid adjustments according to performance
Use automation to take it to the next level
Test brand term performance
Get your PLAs right
Go global – but be sensible
Email:
Tel:
Web: www.searchlaboratory.com
Twitter: @searchlabs
Contact details
Pete Whitmarsh
0113 2121211