Paid Search Trends to Capture the Deal-Seeking Shopper This Holiday Season

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Paid Search Trends to Capture the Deal-Seeking Shopper This Holiday Season

This article was first posted on Retail Online Integration

Posted by Fiona Gill, VP Client Services

In June, BIGresearch reported that 89.9 percent of Americans with jobs don’t expect to see a pay increase in 2012. As a result, people plan to continue their belt-tightening habits: 58.9 percent plan to spend less on clothing, 53.1 percent plan to comparison shop and 50 percent plan to stay on a strict budget. So, how can you grow your holiday sales while consumers are reducing their spending habits?

It’s not a revelation that people use search to find the lowest prices and most convenient ways to purchase products. Search engine marketing is constantly evolving to meet shoppers’ needs. Perhaps now more than ever, today’s searchers need and want coupons, promotions and free shipping. Search is therefore evolving to better engage these deal seekers. There are three promotional search trends that every cross-channel retailer should explore this holiday season:

  • search-embedded coupons;
  • free shipping; and
  • mobile-targeted promotions.

Embracing these trends requires alignment between your company’s online marketing team, offline stores and merchandising department.

Search-Embedded Coupons

As always, promotions will be a critical component of holiday sales. How do your promotions stand out on search engine results pages (SERPs)? Retailers have always been able to highlight promotions in search ad copy, but now there are beta opportunities to embed coupons within paid search listings — i.e., Google Offers. Like Groupon or LivingSocial, Google Offers provides daily deals and coupons. Google Offers’ coupons can be embedded in top sponsored paid search ads on both desktop and mobile devices. The coupon appears below the search listing, allowing your listing to occupy more valuable SERP real estate and provide an incentive for deal seekers to give you a second glance. Searchers who click on the coupon are able to redeem it one of three ways: online, print it to use in-store or show their mobile device to a cashier to scan the coupon’s barcode.

Retailers have had success driving efficient offline conversions from desktop and mobile searches via Google Offers. For example, a three-day, one-city coupon for a multichannel retailer drove 3,000-plus in-store transactions via desktop and 1,000-plus in-store transactions via mobile at a very efficient paid search cost-per-sale ratio. Interestingly, in some cases I’ve seen more coupon redemptions than actual clicks on the coupon. This suggests that people are discovering the coupon via paid search then sharing it with friends through social networks and other channels.

Paid search coupons encourage consumers to engage with your brand. Consumers advocate a great offer they’ve found to their friends, helping drive traffic to your store at no incremental click cost. Retailers have also seen particular success with SERP-embedded coupons in mobile as searchers are increasingly using mobile devices to seek out deals while in-store.

Google Offer Ads enable retailers to mirror or tie together online and offline coupons. Online marketers are creating closer partnerships with their counterparts in merchandising to improve alignment around promotional management. SERP-embedded coupons foster this alignment, helping retailers understand the incremental value of online promotions and allowing them to implement return on investment models that incorporate product and promotional margins.

Free Shipping

Free shipping has become a “need to have” for retailers instead of a promotional boost mechanism. comScore reported in May that about half of all online transactions in the first quarter of the year included free shipping. For that reason, many consumers are now taking free shipping for granted. comScore found that 61 percent of shoppers are “at least somewhat likely” to abandon their shopping cart if they’re charged for shipping.

Online marketers are aligning with internal stakeholders to embrace this trend. It starts with testing and reporting. For instance, your online marketing arm may find — like comScore did — that orders including free shipping are 30 percent higher in value than orders not including free shipping. It may also find via paid search copy testing that “Free Shipping” ad copy helps boost clickthrough and conversion rates. Such findings are being used to make the internal case for free shipping. Create marketing accountability and answer the question, “If we have to charge for shipping, are we more likely to make the sale if we integrate the shipping cost into the product’s price?”

Mobile Promotions

Mobile search will be critical to retailers this holiday season for a couple of reasons: one, it helps get people into your store and, two, it helps shoppers find deals while they’re in your store. For instance, Performics’ 2011 Mobile Search Insights Study found that 63 percent of people have changed the way they gather information due to mobile search. An April report from BIA/Kelsey Group found that 59 percent of consumers visit a retail location after searching for that business on a mobile device.

Ensuring that your promotions are visible in mobile search is essential for retailers this holiday season. It’s expected that mobile paid search impressions will be at an all-time high in December. Based on Performics’ aggregate client base, Google mobile paid search impressions peaked in December 2010 at 13 percent of all Google paid search impressions (desktop plus mobile). After dropping in January, mobile paid search impressions this year have risen steadily each month. In June that figure reached 12 percent of total impressions, four times higher than the previous June. These year-over-year increases, coupled with mobile’s strong 2010 performance, foreshadow a huge mobile paid search opportunity for retailers. Despite aggressive growth, mobile paid search is still a bargain: mobile cost per click (CPC) for Performics’ clients is about half that of desktop CPC.

It’s important to separate desktops, smartphones and tablets into unique campaigns. Google has reported that mobile-only campaigns perform 11.5 percent better, on average, than hybrid desktop/mobile campaigns. This is because searchers use different devices in different ways. For instance, smartphone searchers are unlikely to scroll through search results because of the small screen. It’s critical to appear in the top sponsored listings on smartphones. On desktops and tablets, searchers are more likely to peruse results, possibly clicking further down the page. Landing page strategies should also differ as desktop and tablet users have more room to browse than smartphone users. Keep in mind that many mobile devices (e.g., iPad) don’t support Flash. Also, ad copy can be optimized per device (e.g., “purchase now from your tablet”).

Time-of-day search behavior via mobile complements desktop search behavior. Last holiday, Performics analyzed time-of-day search activity by device the week before Thanksgiving. It found, not surprisingly, that searchers rely on mobile devices when they’re away from their work desks. More interestingly, it found that mobile impressions peaked during the morning commute and early lunch hours, but mobile clicks didn’t peak until after work (6 p.m. – 9 p.m.). This indicates that consumers perform mobile searches for different purposes at different times of day — searching for content earlier and completing transactions later. Retailers should conduct a similar analysis to determine the best hours to run aggressive mobile promotions this holiday season.

When money is tight, people turn to search to find the best deals online. Embrace the above trends to capture deal-seeking searchers this holiday season. Invite them into your store — online or offline — with a compelling paid search offer on the right device at the right time. Doing so will help produce a profitable holiday season.

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