2011 Christmas Season Guide

Transcription

1 2011 Christmas Season Guide Covering Search Advertising in the United Kingdom October 2011

2 CONTENTS Contents Contents Introduction Christmas Season Recap... 4 Key Trends... 4 Consumer Search Behaviour... 5 Online Advertiser Behaviour... 8 What to Expect in Competition CPC and Budget Inflation Kenshoo Best Practices Ad and Keyword Management Automate bulk ad copy and landing page changes on important dates Create a Dimension for buckets of keywords and/or ads that are directed to a different sales page on your site during a promotion Use Kenshoo Editor to make bulk changes to ads and keywords Use automated search engine synchronisation to make sure your changes get applied to the engines Budget Management Increase campaign budget caps on all search engines for relevant campaigns so that ad delivery is not constrained Use Kenshoo Editor to bulk manage your budgets Use Kenshoo s Forecast reports to find the optimal budgets for your bid portfolios Bid Optimisation Use Kenshoo s keyword-level bid policies to capitalize on the traffic and increased competition Use Advanced Search to selectively increase and decrease bids Reporting Set bookmarks for important campaigns/ad groups/ads/keyword information so you can quickly jump to a page Create Dashboards for saved reporting views that update automatically Use Advanced Search to schedule reports to be sent to your inbox on a daily basis Use Scheduled Reports to run reports with data that spans multiple profiles Alerting and Monitoring Use Kenshoo s Objectives view to monitor your profile goals Set bespoke alerts to check for abnormalities in your campaigns Conclusion

3 INTRODUCTION /////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////// This 2011 Christmas season will be as important as ever for U.K. businesses. Recently released retail figures by the British Retail Consortium and Office for National Statistics suggest small growth in sales volume but largely driven by inflation. For the first time, in 2010, Kenshoo mined aggregate U.S. customer data to produce the Kenshoo 2010 U.S. Online Retail Holiday Shopping Report. Kenshoo s digital marketing software is now used by 7 of the 10 largest global retailers and the 2010 research included a cross-section of Kenshoo s retail customers in the U.S. that had been using the platform for at least 2 years. In 2011, we will expand our research to include a broader set of retailers and publish a U.K. retail index. Furthermore, we will also be monitoring Facebook advertising via Kenshoo Social and plan to share relevant data points and insights. This document contains a summary of Kenshoo s key findings from the 2010 Christmas season along with some guidance on what to expect in Our goal is to equip Kenshoo customers to take advantage of the latest consumer and search engine marketing (SEM) trends along with Kenshoo s powerful software to deliver unprecedented results during this critical Q4 shopping season. To help you achieve your goals, we ve compiled over 15 best practices in this guide for deploying Kenshoo across the 5 main areas of SEM: Ad and Keyword Management Budget Management Bid Management Reporting Alerts and Monitoring We hope you find this resource helpful and all of us at Kenshoo look forward to helping you reach your full potential this year! 3

4 2010 CHRISTMAS SEASON RECAP Key Trends /////////////////////////////////////////////////////////////////////////////////////////////////////////////////// Kenshoo identified 6 key trends through its 2010 research: 1. The Online Christmas Shopping Season is Starting Earlier and Lasting Longer 2. Online Shoppers are More Responsive to Paid Search Advertising 3. Consumers are Buying More Often With Smaller Basket Sizes 4. Paid Search Advertisers Increased Effectiveness and Budgets 5. Competition for Retailers the Last Week in November and the Second Shopping Week in December 6. Search Advertising Activity Slows Dramatically After Christmas U.S. Search Engine Marketing Results at a Glance: Christmas Season 2010 vs 2009 Search Advertising Budgets up 52% Online Sales Transactions up 87% Online Sales Revenue up 69% Return on Ad Spend up 25% (to $10.60) *Date range: 3 weeks Pre-Thanksgiving through New Year s Weekend Source: Kenshoo 2010 Online Retail Holiday Shopping Report Kenshoo, Inc. Now, let s take a deeper look at the data and what we learned about consumer and advertiser behaviour. 4

5 Consumer Search Behaviour /////////////////////////////////////////////////////////////////////////// In 2010, consumers proved to be more willing to interact with paid search advertising as Clicks, Click-Through-Rates, and Conversion-Rates rose dramatically higher relative to impressions. As you can see in Figure 1, despite a 54% increase in the number of clicks on search ads during the 2010 Christmas season, we only saw a 1% increase in impressions. This means that retailers ads appeared about the same number of times as they did in One explanation for this trend is that people aren t turning to search engines more often when shopping. Instead of just trusting search engine algorithms to find the best products, consumers are turning to their social networks for recommendations. Every day, more and more people query their family and friends on Facebook for advice on where to shop and what to buy. FIGURE 1 Year-over-Year Changes in Key Consumer Direct Response Indicators Source: Kenshoo 2010 U.S. Online Retail Holiday Shopping Report Kenshoo, Inc. In Figure 2 you can see Clicks and Conversions for a subset of the Kenshoo U.K. Retail Index. Note the ramp-up beginning mid-november and continuing steadily toward the second shopping week in December. FIGURE 2 Click and Conversion Volume During the 2010 Christmas Season for Subset of Kenshoo U.K. Retail Index Source: Kenshoo, Inc

6 The interplay between search and social is reflected in consumer conversion paths that contain interactions with both paid search and paid social ads. One retailer, that s using both Kenshoo Enterprise and Kenshoo Social, saw that 20% of all conversion paths contained clicks from Facebook and paid search prior to purchase. In fact, over 1/3 of these purchases had a brandquery in the path which suggests that consumers are discovering brands on Facebook and then searching for them by name. FIGURE 3 Logarithmic Distribution of Keywords in Multi-Channel Conversion Paths for Kenshoo Retail Customer Source: Reinforcing the notion that consumer behave differently on search engines compared to social networks, you can see in Figure 4 that the click-rates for search ads for a sample of 100 Kenshoo Search campaigns range between 0.10% and 10% while a sample of 40 Kenshoo Social campaigns delivered click rates ranging between 0.01% and 0.10%. FIGURE 4 Distribution of Click-Rates for Search Engine & Social Network Ad Campaigns Running Through Kenshoo # of Campaigns Social Search CTR Source: 6

7 In 2010, we saw that online consumers were less likely to load up their baskets all at once with the same retailer. Enticed by free shipping and more online retailers to choose from, consumers spread their purchases across many sessions and/or stores. This is reflected in Figure 5 where you can see that, while total overall transaction volume increased, the value per transaction decreased. FIGURE Christmas Season Search Advertising Online Sales Transactions & Average Order Value Year-over-Year Source: Kenshoo 2010 U.S. Online Retail Holiday Shopping Report Kenshoo, Inc. All in all, a higher level of consumer engagement in 2010 and increased level of comfort with online shopping led to a lift in Revenue driven by paid search of 69% over the previous year. FIGURE 6 Christmas Season Revenue from Paid Search up 69% Source: Kenshoo 2010 U.S. Online Retail Holiday Shopping Report Kenshoo, Inc. 7

8 Online Advertiser Behaviour ////////////////////////////////////////////////////////////////////////////// In 2010, online advertisers dramatically increased their search marketing budgets over the previous year. In particular, advertisers maintained higher spend levels throughout the two weeks leading up to Christmas as seen in Figure 7. FIGURE Christmas Season Search Advertising Budgets up 52% Source: Kenshoo 2010 U.S. Online Retail Holiday Shopping Report Kenshoo, Inc. Higher search advertising budgets and increased competition among advertisers led to higher cost per click rates, especially the last week in November and the 2nd shopping week in Dec. FIGURE Search Advertising Competition (Daily Cost per Click) Source: Kenshoo 2010 U.S. Online Retail Holiday Shopping Report Kenshoo, Inc. 8

9 Despite more competition in the auction marketplace, higher costs did not have a negative impact on results, as advertisers saw their Return on Ad Spend increase by 25% over the previous year. FIGURE Christmas Season Paid Search Return on Ad Spend Up 25% Source: Kenshoo 2010 U.S. Online Retail Holiday Shopping Report Kenshoo, Inc. 9

10 Competition - CPC and Budget Inflation ////////////////////////////////////////////////// When planning your Christmas SEM campaigns, it s important to remember that your ads are continually being judged against other ads in the marketplace not only by consumers but also by the search engines for quality and position. During the Christmas season we see a noticeable inflation in CPC and budgets across all categories. In order to maintain your ad display positions, you need be ready to increase your budgets and bids accordingly. Following are examples from sample Kenshoo retail customers during the 2010 Christmas season that illustrate these points. Looking at an ad group for name-brand toys in Figure 10, we see that costs reach a peak at the end of November. However, the spike in cost does not correlate to a spike in position. The average position remained fairly steady through the season until the tail-end when it begins to rise most likely due to a drop off in competition. In this case the retailer used a defensive strategy by allocating budgets to protect what they felt was the optimal ad position. If you have products that, like toys, are also highly affected by the Christmas season that you can expect costs to rise even if you plan on maintaining your impression share. FIGURE 10 Average Position vs. Cost for Name-Brand Toys Source: Kenshoo, Inc In Figure 11, we can also see that the cost inflation is not just a result of raised bids and/or budgets. Looking at the average CPC, we see that, even as clicks becomes more expensive, the average position does not change. This results in more money spent just to maintain ad positions. FIGURE 11 Average Position vs. CPC for Name-Brand Toys Source: Kenshoo, Inc

11 In Figure 12, we look at an ad group for name-brand cameras and see a similar trend of costs rising over the period while the average position holds steady through the end of November. FIGURE 12 Average Position vs. Cost for Name-Brand Cameras Source: Kenshoo, Inc However, by increasing bids via Kenshoo s Portfolio Bid Algorithms, the advertiser is able to raise its average position throughout the final two weeks before Christmas. As you can see, Figure 13 shows a downwards trend as position 1 is displayed below 2, 3, 4, etc. This also corresponds with higher ROI through that same period as can be seen in Figure 13. FIGURE 13 Average Position vs. ROI for Name-Brand Cameras Source: Kenshoo, Inc

12 Kenshoo Christmas Season Best Practices

13 Ad and Keyword Management Automate bulk ad copy and landing page changes on important dates. Planning on swapping in new promotions on key dates around Christmas? Simply save your Advanced Searches and you will be able to schedule them to run at set times. Just check the boxes Automatically accept results and Automatically upload to channels and Kenshoo will run your Scheduled Actions at the desired times. SCHEDULED ACTION STEP 1: Create Advanced Search SCHEDULED ACTION STEP 2: Save Advanced Search on Results Page SCHEDULED ACTION STEP 3: Schedule your action 13

14 Trying to figure out the right times to schedule various actions? Synchronising your keywords and ad copy with the correct times of the Christmas season can be a full-time job. Using Google Trends we can see which days are most important for key terms and calls-to-action. 1. FREE SHIPPING In 2010, the final standard free shipping day was December 17th which correlates with the spike in Figure 14. What s interesting to note is that, even 2 days past the final free shipping day, people are still searching for free shipping. Even if you don t offer free shipping but can deliver goods after free shipping day, you can get creative with ad copy to capture some of this opportunity. FIGURE 14 Free Shipping Keyword Usage Source: Google Trends 2. LAST MINUTE Figure 15 shows there are plenty of procrastinators our there looking for gifts at the last minute. If you offer virtual goods or rush-shipping, make sure that you reach these consumers. FIGURE 15 Last Minute Keyword Usage Source: Google Trends 14

15 3. AFTER-CHRISTMAS SALE Consumers are already looking for After-Christmas Sales before Christmas even happens, so be ready. You can see the spike begin on December 24th in Figure 16. FIGURE 16 After Christmas Sale Keyword Usage Source: Google Trends 4. NEW YEAR S SALE In Figure 17, we see that consumers use the week after Christmas to search for New Year s sales. Make sure that you have ad copy and landing pages in place before you take off for the weekend. FIGURE 17 New Year s Sale Keyword Usage Source: Google Trends 15

16 Create a Dimension for buckets of keywords and/or ads that are directed to a different sales page on your site during a promotion. In Kenshoo, Dimensions allow you to manage landing page flights similar to ad flights. After creating a Dimension, you can leverage Advanced Search and Scheduled Actions to easily update the landing page for the bucket of keywords once the sale ends or as necessary. Dimensions can be created to manage ad copy and landing pages for specific promotions. As an example, below you can see there is a Dimension for shoes and categories for different shoe brands. In this case, assume that each shoe brand is offering a different promotion and that the promotion changes over time. Dimensions and Categories Assign the ads to the relevant categories using Advanced Search. With the ads categorized, you can query Advanced Search by the Dimension plus Category (read: promo ads). 16

17 Advanced Search with Dimension Filtering Advanced Search Ad Copy and Landing Page Modification Advanced Search Results with Dimension Filtering With the filtered search results, you can update the status of the ad, change the ad text, and change the landing page as required. Dimensions can also be assigned to keywords with specific landing pages. Dimensions can also be assigned to keywords with specific landing pages. 17

18 Use Kenshoo Editor to make bulk changes to ads and keywords. Extensive changes can be made across channels and profiles with a few clicks of the mouse using Kenshoo Editor s bulk edit option. Replace destination URLs for thousands of keywords or ads in a matter of minutes. Switch your landing pages and ad copy quickly across all your activities by multi-selecting the items and making the change in the Edit pane. Use Kenshoo Editor to quickly switch your promotions at the critical junctures of the Christmas season. You can also bulk change budgets, bids, and copy items from one location to another. Kenshoo Desktop Editor 18

19 Use automated search engine synchronisation to make sure your changes get applied to the engines. Make sure that the changes you are making to your campaigns are being uploaded to the search engines. Check that you have turned on Automated or Scheduled upload in your Profile Settings. Search Engine Upload Settings If you do select Scheduled and Automated upload but don t want your changes to be applied automatically, just set their status to Review and they will be excluded from the uploads until you manually change them back to approved. Element Status Settings 19

20 Budget Management Increase campaign budget caps on all search engines for relevant campaigns so that ad delivery is not constrained. During the competitive Christmas season with consumer demand peaking, you don t want your ads capping out. Be mindful of your budget settings. For Google campaigns you can choose from two ad delivery methods Standard or Accelerated. Google Budget Setting in Kenshoo For adcenter campaigns, Kenshoo supports daily budgets. Monthly budgets can be set in the adcenter interface. Note: if a campaign is set up with monthly budgets through adcenter and the change is made in Kenshoo to the daily budget in the grid OR monthly budget in the Kenshoo settings page, it will always change it in MSN to per day. Bing AdCenter Budget Setting in Kenshoo 20

21 Use Kenshoo Editor to bulk manage your budgets. You can use the Kenshoo Editor to make bulk changes and manage your campaign budget settings. If you want to set the same budget to several campaigns just select them and apply in the Edit Pane. You can also quickly jump from campaign to campaign using the Kenshoo Editor to change budgets one-by-one. Edit Panel from Kenshoo Editor 21

22 Use Kenshoo s Forecast reports to find the optimal budgets for your bid portfolios. If you are using Kenshoo Portfolio Bid Management (model-based policies) you can run Forecast reports in the Reporting Dashboard to see how budget changes will affect your performance. Forecast Report in the Kenshoo Dashboard 22

23 Bid Optimisation Use Kenshoo s keyword-level bid policies to capitalize on the traffic and increased competition. Figure 18 describes the various keyword-level bid policies available out of the box in Kenshoo along with potential use cases. FIGURE 18 Kenshoo Keyword-Level Algorithms POLICY DEFINITION 2011 CHRISTMAS USE-CASE CPA Tries to increase the volume of low CPA keywords and decrease the cost of high CPA keywords. Useful to manage content targeted campaigns if you are running branding activities. BRANDING Pushes keywords upward towards a given position. Constrain keywords to a position. i.e. remain in position 1 for ugg boots. IMPROVE CTR Tries to improve the CTR by raising bids and thus position. Notice: the bid will not be raised above the Campaign s Maximum PPC. Increases traffic, but not to a target position. Incrementally raises bids of keywords. Monitor and adjust policy over time. INCREASE PROFIT Increases profit while maintaining a ROI level above some minimal value. The policy achieves its goal by increasing the volume or decreasing the cost of keywords. Good for campaigns that are new for Christmas. For existing campaigns we recommend using Portfolio Optimisation assuming that sufficient data exists. LOWEST BID FOR POSITION Lowers bid for keywords in positions higher than a specified threshold (default 10) to a new bid just above the actual CPC. Additionally, increases bids for keywords below the desired target position by a predefined percentage. Use this policy to avoid unnecessary over-bidding or when copying campaigns between different countries. The marketplace is competitive and CPC s will increase. Use this policy to maintain the lowest CPC for a given position. 23

24 Use Advanced Search to selectively increase and decrease bids. To expose seasonal keywords, there s also the option to query for keywords that are less than the minimum bid and then take an action to increase those bids to the minimum. Important Note: This is recommended only for Kenshoo users who manage their bids with keyword-level algorithms or manually. If you are using Portfolio Bid Optimisation, we do not recommend manual interference. Advanced Search Bidding 24

25 Reporting Set bookmarks for important campaigns/ad groups/ads/keyword information so you can quickly jump to a page. Bookmarking is a feature that allows you to save any page in the Kenshoo interface for quick access. Bookmark campaigns, ad groups, keyword lists, or ads that require frequent review. New this year, you can also create bookmarks for Advanced Searches so that you can quickly run your saved queries without having to reconfigure all of your settings. Bookmarks 25

26 Create Dashboards for saved reporting views that update automatically. The Kenshoo Reporting Dashboard offers quick and easy widgets to give you snapshot views of the activities you want to track. Widgets you configure can be shared with other Kenshoo users within your organization. Dashboard Sharing Settings With over 14 bespoke widgets, the reporting possibilities within Kenshoo are endless. Keep in mind that many widgets have the option to view revenue, click, and conversion trends for current day. This capability allows you to monitor and adjust strategy intraday. Here are a few specific widgets worth noting: HOURS: Track conversions*, clicks, and revenues throughout the day for specific campaigns or all campaigns. This widget provides same day updates every few hours and provides directional intraday information. *only for customers using a Kenshoo pixel. Hours Widget 26

27 PERIODS: Compare campaign or ad group performance against the previous day. Period Comparison Widget DIMENSIONS: Set up dimensions to cluster campaign, ad group, ads, and keywords. Create different dimensions for high performing products, promotions, ads, and more. Understand how a single business unit is performing across multiple channels. Dimensions Widget 27

28 NOTES: Write and store reminders and action items within Kenshoo. Notes Widget 28

29 Use Advanced Search to schedule reports to be sent to your inbox on a daily basis. Advanced Search Time Period Selection Advanced Search Scheduled Reports are bespoke reports that you can create and schedule to arrive in your inbox daily. Reports are bespoke to your specific requirements and time ranges. Any query performed through Advanced Search can become a scheduled report. You can query for not only key performance indicators, but for reports for disapproved keywords and ads as well. Kenshoo updates revenue numbers in the grid every couple of hours, allowing you to query for incoming conversions intraday. The intraday conversion data includes information on the campaign, ad group, keyword, and revenue amount. This information can be paired with cost data, mined, and optimised intraday. Sample Dimension Report Advanced Search Scheduled Reports are especially useful when you have Dimensions set up. Dimensions allow you to cluster, report, and take action on elements across multiple channels. The elements can be campaigns, ad groups, ads, or keywords. For example, if you had a Beauty promotion across your site, you could create a dimension for Beauty and categories for each brand such Lancome, Estee Lauder, MAC, etc. 29

30 Use Scheduled Reports to run reports with data spanning multiple profiles. Use Kenshoo s Scheduled Reports to create multi-profile reports to quickly monitor your activities across more than one profile. You can also use these reports with Dimensions to create deeper analytical views. Scheduled Report Templates Fusion Reports allow you view large amounts of data in a single report. For example you can create a report with all of your active campaigns and include the below data. Fusion Report Available Campaign Columns 30

31 Alerting and Monitoring Use Kenshoo s Objectives view to monitor your profile goals. Set your profiles objectives to visually monitor your goals for the Christmas season. The objectives will display the pace and distance from your goals giving you a quick view of performance and highlight areas that need attention. Objectives Settings 31

32 Set Bespoke Alerts to check for abnormalities in your campaigns. Use your Advanced Search queries and modifications to run scheduled actions without manual intervention. Just save your search results and then click the link that appears to schedule this action. Step 1: Save Advanced Search Templates Step 2: Save Advanced Search Templates When the scheduling screen appears, set the notification setting to With Results. This will send an report to you only when there is data in the report. If the Advanced Search query has no results, no will be sent. This is a good way to track the performance of your new ads as you search by dimension and find out if new ads are under or over-performing. If you want to track those ads and receive an report every time the query runs, just set the setting to Always. Step 3: Scheduled Action Settings 32

33 CONCLUSION 2010 Recap Consumer Search Behaviour 1. Consumers trust search engine advertising. CTR, Clicks, Conversions, and Conversion rates all rose YOY. 2. SEM impressions were flat as consumers looked to other channels such as social networks for product recommendations. 3. There was a large amount of cross-over between search ads and social ads. The response rate from these channels varies widely with social ad click-rates much lower than search. 4. Consumers are less likely to make all purchases from one retailer during the same session. Transactions rose but average order decreased. 5. Online consumers start shopping early and often. Search volume spikes mid-november and overall Christmas season online sales revenue was higher than any previous year. Online Advertiser Behaviour 1. Budgets were up YOY for the season as retailers pushed hard but there was a sharp decline after Christmas. 2. Cost-per-Click rates were up as advertisers jockeyed for position but strong conversion rates improved Return on Ad Spend Tips 1. Ad and Keyword Management Use Kenshoo s bulk management features and scheduled actions to keep ad copy, keywords and landing pages up to date with the many changes during the Christmas season. 2. Budget Management Use Kenshoo s budgeting features to ensure you have the right amount of spend in market at each of the peak periods and run forecast reports to identify incremental opportunities. 3. Bid Management Use Kenshoo s flexible keyword and portfolio bid policies to react to competitive pressures and maximize your return on ad spend. 4. Reporting Use Kenshoo s widget-based dashboard and also bookmark or schedule reports so that you can have your most important information at your fingertips at all times. 5. Alerts and Monitoring Use Kenshoo s new visualization of objectives to monitor your progress towards bespoke goals and identify and react faster to unexpected market variables. /////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////// At Kenshoo, we ve worked hard to add new features to the platform that will give you every possible advantage this Christmas. We hope that the data and best practices we ve shared will help you exceed your goals and ring in a very happy new year. We would also like to remind you that you can look forward to the 2011 Kenshoo U.K. Online Christmas Shopping Report which will be released soon after Green Monday midway through the Christmas season and updated again after New Year s weekend. If you want to review the full 2010 U.S. report you can find it HERE. All the best for a joyful season and happy new year! 33