Slides

September 12, 2012
Search Advertising Fundamentals
Proprietary & Confidential
2
Search Ads
95% of
Google
Revenues
Natural search results
Paid Search Ads
Proprietary & Confidential
3
From Search to Purchase
Searcher
Searches for
User
Advertiser
Relevant info.
Types keyword
and find results
on Search Engine
Places ad on
Search Engine (ex.
Google)
Return on
Ad Spend
(ROAS) can be
ascertained
From Search to Purchase
Advertiser
gets Revenue
Makes a
Purchase
Clicks Ad and
enters Web site
Looks at
Products on site
Looks at
Products on site
Exits from the
site – No
purchase
Bill Gross – The Founder of Paid Search Advertising
www.NetElixir.com
The NetElixir Presentation
World’s First Pay-Per-Click Advertising Engine. Later Changed its
name to Overture.com
www.NetElixir.com
Yahoo to buy Overture for $1.63 billion
July 14, 2003 1:21 PM PDT
www.NetElixir.com
He helped Google change the rules of the game
In early 2002, a Google employee, Salar Kamangar, now 28,
Salar Kamangar
convinced Mr. Schmidt and the founders to switch to an auctionbased system like the one set up by Bill Gross, the head of IdeaLab.
Mr. Gross had created Goto.com, a search engine made up entirely of
ads, where advertisers paid only if their ad was clicked on, and the
advertiser who bid the most per click was listed first.
www.NetElixir.com
In 2003, US Paid Search Advertising Revenues
were $972 million.
In 2011, US Paid Search Advertising Revenues
hit $14.8 Billion (up 27% over 2010 revenue).
Proprietary & Confidential
9
Paid Search Advertising is..
• Measurable.
• ROI focused.
• Relatively in-expensive.
• Great source of consumer insights.
Proprietary & Confidential
10
Best Practices in Search Engine Marketing
Build a Marketing Plan
70% of retail search advertisers
do not have a marketing plan
that connects goals – strategic
initiatives and tactics.
13
The “GOST” Framework
Primary Goal
Secondary Goal
Strategic
Initiative #1
-Tactic 1
- Tactic 2
Strategic
Initiative #2
-Tactic 1
- Tactic 2
Strategic
Initiative #3
-Tactic 1
- Tactic 2
Primary Goal
Secondary Goal
15
Strategic Initiatives
16
Paid Search Tactics
17
The “GOST” Framework
Grow Sales
Revenue by
120% to $xyz
Revenue/Cost >
8x
Promote “star”
products
nationally.
-Expand Reach
- Create
Differentiation
Flank
competitors
using Private
Label
-Map Competitor
Activity
- Include Price in
ad copies.
Gain 30%+
PPC SOV in
top 5 states
-Track
Impression
Share
- Local buying
behavior
FY 2011: Y/Y SEM Results
• Y/Y Revenue Growth = 220%.
• Revenue/Cost = 11 x.
19
Deciding what products to
promote via paid search
20
Keyword Strategy and “Return on Investment”
Margin
High End
Jewellery
• Scrub your keyword list
regularly
• Time Bound promotions to
boost sales
• Experiment with ad copies
and landing pages
Is Keyword Search Advertising
Right for you?
• Focus on Efficiency and
growth
• Controlled Keyword list
expansion
• Identify new sources for
keywords
•What’s your average order
value? What is the order
margin?
No-brand
trinkets
Velocity
Gourmet
Food (ex.
steak)
Ink
Cartridges
Key Points
•
•
•
•
•
22
Category level segmentation based on margin and velocity.
Unique paid search strategy for each segment.
Pre-Plan the keyword mix for each segment.
Treat trademark and non-trademark campaigns separately.
Treat each keyword as a “profit center”.
A Structured Approach to Growing
The Paid Search Program
23
The Opportunity Matrix
Non-SEM Factors
SEM
Elements
Consumer
Markets
Competitors Occasion
Keyword
Strategy
Ad Copy
Strategy
Bidding Strategy
Landing Page
Strategy
• Provides a framework for targeted testing.
• Combination tests can open up new opportunities.
• Establishes a logical construct for testing causal relationships.
Paid Search Revenue Has Dropped.
I don’t know why?
25
5 Step Problem Analysis
•
•
•
•
•
Precise Problem Statement.
Which of the elements below has dropped. How much?
Since when has the drop been observed?
List Possible Causes for drop in specified element.
Test results to establish the Most Probable Cause.
x
x
Impressions Click through
Rate
26
=
x
Conversion
Rate
Average
Order Value
Sales
Revenue
Are All Paid Search Clicks Equal?
27
Tracking Revenue/Click across geos for Lenovo.com
Proprietary & Confidential
28
What does this mean for the search marketer?
• Geo-targeted customer acquisition strategies.
• Deeper shopping cart analysis for different geo’s.
• De-code geo-specific customer purchase patterns
to create more precisely targeted campaigns.
Proprietary & Confidential
29
Summary
1.
2.
3.
4.
Use the GOST Framework to structure your Marketing Plan.
Know what products to advertise via Paid Search.
Use the Opportunity Matrix to Grow Paid Search Program.
When Paid Search revenue drop happens, use 5 step
Problem Analysis process.
5. Evaluate the Quality of Paid Search Clicks by Geos. to create
targeted campaigns.
30
Questions Please
31
NetElixir Inc.
Email: [email protected]
Website: www.netelixir.com
Phone: 609.356.5112
This et li ir report is intended for general information and is ased on pu licly availa le data availa le on the Internet at a
particular point in time. et li ir gives no guarantee regarding this information and accepts no lia ility for any inconvenience or
any direct or conse uential loss arising from reliance upon this information.
o part of this report may e reproduced stored in a retrieval system or transmitted in any form y any means electronic
mechanical photocopying or otherwise without the permission of et li ir Inc.
et li ir Inc. ll rights reserved.
32