Given the increasingly competitive cost-per-click environment in paid search, it’s becoming imperative that online retailers seek new ways to improve their return on investment. Compared to this time last year, average CPCs are up 30%; I have some clients who are seeing 40% & up. Using a combination of automated bid management with qualitative data analysis is industry standard. If you’re not already using proprietary tools & some analysis done by an actual person, you’re behind the game. Get on that…stat.
Your next steps are to…
- Use your online analytics to identify which states (or larger geographical area) generate the most sales.
- Combine sales & costs data. Search engines can give you impression, cost, & click data by state. Mesh these results & voila, you have yourself some nice, segmented data with which you can make educated business decisions.
- Make difficult decisions. If you are a nationwide &/or an international retailer, you may need to cease advertising in retail trade areas. This might not be wise since just about everyone uses search to find out, among other things, where your offline stores are. Not everyone clicks on the natural search engine results.
Now that holiday shopping is in full swing, those year-over-year CPC increases are going to rise even more. With the current state of the economy & many etailers cutting budgets in the face of decreased sales, your job as an online marketer is to help mitigate risk & add to the bottom line. Many retailers are going all out with aggressive promotional strategies; this cuts into margins. Smaller margins & increased customer acquisition costs do not go over well with senior management & investors.
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