E-RETAIL LEARNING CENTER

1.TOP 10 MISTAKES OF SMALL ONLINE RETAILERS
2.10 BASICS OF EFFECTIVE ONLINE MERCHANDISING
3."PAIN-PER-CLICK" - PUTTING THE "PAY" INTO THE CLICK
4.Using Shipping Discounts to Increase Conversions

"PAIN-PER-CLICK" - PUTTING THE "PAY" INTO THE CLICK

Easy access to Pay-Per-Click (PPC) marketing has made PPC the most (mis) used online marketing tactic for small retailers. Tips and advice on how to put the pay back into the click.

Rule #1: PPC is Lazy Man's Marketing

PPC can be effective at driving some sales - and in some cases, significant sales. But, compared to other creative marketing (like good strategic partnerships), PPC is expensive. The returns on PPC campaigns for most e-retailers is much lower than that of good creative marketing.

Too many small retailers rely on PPC as a primary strategy, because it's just so damn easy and requires little thought or planning to get started.

Rule #2: Have a good PPC Strategy

There's nothing wrong with using PPC - we use it for most of our clients in some frequency. However, you'll get the best returns from it if you have a specific strategy.

In most cases, we find the best returns on pay-per-click when:


  • We use it to research for organic search optimization, finding out which keywords/phrases have the highest conversions to sales, so we know what to spend our optimization efforts toward.
  • We use it to buy very specific keywords/phrases that have high returns, but we're having a difficult time getting ranked organically for.
  • Special holiday promotions where there isn't time for organic search rankings to "catch up" with the merchandising for that holiday promotion.
  • We want to test market new products - we can quickly and effectively test conversion results using PPC without a major investment, or serious planning.

Rule #3: Semantics are everything - be specific!

General keywords are expensive to buy, an typically have very poor conversions to sale.

For example, if you sell chocolate, you might choose to pursue the keyword "chocolate".

As I'm writing this article, the cost to be in the top 5 positions for the word "chocolate" using Google's Adwords is around $1.40 PER CLICK! If you don't convert at least 5-10% of those clicks to orders, you're going to lose your ass on that one. And chances are you won't convert nearly as high as with a more specific phrase.

The problem is that "chocolate" is very general. Not only are more (amateur) marketers pursuing it and driving the bid price up, a searcher might use that keyword when their motivation is actually chocolate recipes, or information about how chocolate is made...or even the "LG Chocolate" cell phone! So maybe they get curious and click your link - but they're not serious about buying.

On the other hand, the keyphrase "artisan dark chocolate" is about $.50 per click, and indicates more clearly that the searcher is looking for chocolates presumably to buy.

Pick your keywords carefully. Both Yahoo! Search Marketing and Google's Adwords programs have keyword research tools that let you type in keywords and estimate clicks and costs you should anticipate. Use these tools.


Rule #4: You don't have to be #1 to be #1

A common beginner's mistake is to assume that they need to be the #1 ranked sponsored search ad. This is a misconception, and will lead to drastic over-spending.

If you have a good ad, and your merchandising is competitive, you'll do just fine being in the number 3, or even fifth ranked spot.


Rule #5: It's an advertisement. Write an attractive offer.

While sponsored search is very limiting in terms of ad copy, that doesn't mean you can't write an effective ad. Consider what the shopper has just searched for, and write your ad copy to appeal to the need they've just expressed.

Remember that your ad is going to be displayed next to your competitors ads, so indicate any special offers you have that are relevant - like "Free shipping over $50".

Be careful though to be up-front in your ad. If "thorlo socks" are $8 per pair...but only sold in packs of 6 - make sure you indicate that. You don't want shoppers clicking through (costing you money), only to discover that the terms of the sale are unacceptable to them.

Don't get lazy and write a single ad for significant variations on a keyphrase. For example, one ad is probably not sufficient for the keyphrases "mens golf shirts", "golf shirts", and "womens golf shirts" - each of those should have its own ad copy. The "Golf shirts" ad should probably specify that you have both mens and womens. The "mens golf shirts" variation might best mention popular mens brands in the ad, etc.


Rule #6: Track EVERYTHING

The major PPC venues (Google, Yahoo, MSN) offer conversion tracking. Implement it. Right away. If you haven't implemented conversion tracking and you're still here reading this...shew. You're dismissed. Go implement it now, then come back and read the rest of this!

To implement PPC with good returns, you need to be tracking the number of clicks, conversions and cost per conversion for each keyphrase variation you're bidding on. Period.


Rule #7: It's about conversions, not quantity

It doesn't matter how many clicks you get - only how much each order costs you. Know your maximum acceptable order acquisition cost, and stick to it.

If a keyphrase is performing close to your acceptable range, try adjusting the maximum bid for it down slightly. You might get less clicks, but you'll get the orders at a price your margins can support.

Don't hold onto a keyphrase just because it drives significant traffic. If that traffic isn't turning into the appropriate amount of revenue, optimize it or cut it off.


Rule #8: One Hundred Clicks to Judgment Day

It's easy to get spooked by a keyphrase when you watch it's click-cost tally start incrementing quickly, without any orders. You might just cut off a keyphrase prematurely that would have actually performed well in the long run.

It's a law of averages game, based on statistical data. Any keyphrase that's received less than 100 clicks hasn't given you a big enough statistical data base to work accurately from. Let it get 100 clicks down before you make any big decisions.


Rule #9: Split your buys into at least 2 campaigns

This one isn't so much a rule as it is a tip. I like to split my ad groups up into 2 campaigns (sometimes more).

The first campaign is "New Keywords" - it's all the new keyword/phrase ideas I've come up with that are un-tested. I set the maximum daily budget on that campaign down pretty low - I don't know how well they're going to perform yet, so I don't want them breaking the bank.

The second campaign is "High ROI Keywords" - it's where I move all of the keywords or ad groups that I've tracked for a while and know that they consistently deliver high returns. This campaign has no maximum daily budget, because I can be confident that whatever amount was spent has provided a strong return. I'm always happy to give away a buck if I know I'm getting two bucks back.

I watch my campaigns closely and shift keywords between campaigns as appropriate, based on the conversion tracking.

Rule #10: Link to the RIGHT Place

Creating ad groups can be a slow, tedious process. Through this process, many PPC program managers tend to try to hurry through it, and end up linking many ads to their site's home page.

Shoppers are using search because they want to get directly to the product they're seeking - as quickly as possible. Shoppers from search don't want (or expect) to hunt around for the item they searched for.

Your ad links should take shoppers *directly* to the selection that fits their search.

Also, make sure that any special offers, statements of unique selling position and credibility all appear on these landing pages.

It's easy for the shopper to simply click back and go to someone else's site if they're not convinced you're the right fit - so make sure you're actually SELLING them on this page!

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