PetSmart acquired Pet360 for $130 million in cash and up to $30 million more in future performance-based payments.
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Quality, not quantity
Indeed, providing search results that drill into a subject can deliver a higher quality audience, even though it is smaller than what may be attracted through broader-based search terms. "The audience may be more finite, but as long as the quality of the audience is there, retailers will work to cultivate it," says Dave Hills, president and CEO of search engine LookSmart Ltd. "The more knowledgeable retailers get about search, the more efficiently they can manage their search strategies."
Still, retailers must remember that they have no control over third-party content appearing outside their site. Unlike customer reviews that appear on their site and can be edited to remove profane language, tirades and the like, third party sites often post unedited comments. That means negative commentary is there to be read or viewed by the consumer reading the post.
While no retailer likes bad publicity, running from it by excluding links to third party sites from a head-to-tail search marketing strategy can be a mistake. Instead, it is better for retailers to learn from such comments and reach out to the disgruntled party to correct the problem.
"There are always going to be negative reviews on third-party sites, so retailers need to be prepared for it and understand that it is better to address it than repress it," counsels Adam Lavelle, vice president of strategy for iCrossing. "Reaching out to unhappy customers to correct a negative experience can create an evangelist that has more influence as a positive voice than they did as a negative voice."
Not just for acquisitions
In other words, search marketing is a way for retailers to interact more effectively with shoppers throughout the lifecycle of the purchase process. By taking this approach, retailers encourage shoppers to repeat the search during future shopping trips. "Search is more than just an acquisition vehicle," adds Lavelle. "It is a behavioral tool that provides an engaging experience and cohesive message that shoppers can take away at any point in the pre-purchase and post-purchase process."
The move to include third-party content to boost organic search is just one aspect of creating a more strategically focused search marketing strategy.
Despite the rising cost of paid search, retailers have accepted the fact they cannot move completely away from paid search for the simple reason it remains highly effective.
"Shoppers that click on paid search terms specifically know what they are looking for, so the term is more relevant to them than the content," says ChannelAdvisor`s Wingo.
To help retailers figure out which keywords to purchase, ChannelAdvisor performs a profit-and-loss analysis of each keyword that is relevant to the retailer`s site and catalog. The company typically identifies five to 10 keywords per SKU to create good keyword density across the head and tail of the search marketing strategy.
"Some terms may be more specific, but they convert better and cost less, so they provide a better economic return," adds Wingo. "There is a cost target that needs to be kept in mind with paid search."
In the event a desired search word is not generating enough conversions, retailers need to consider expanding the number of words. Sometimes it may mean opening a thesaurus to identify similar but unused search words. "Too often retailers will become too comfortable with the keyword pattern they are purchasing," says LookSmart`s Hills. "Helping retailers determine the return on investment of a specific keyword can help them identify words they may not have previously considered."
As a search engine, LookSmart monitors the click-through rate of keywords purchased by advertisers and compares it to the cost per click. "We can point out if a keyword is a clunker," adds Hills. "If there are more effective keyword patterns to be used, we suggest them, especially if they are not being bought."
In many cases relevant keywords that are not bought tend to be part of the tail end of a retailer`s search marketing strategy, which means the keywords are more specific. Although entered less frequently by shoppers in search strings, they are still of value for two primary reasons. First, retailers only pay per click, which means the cost of the word is usually less than a keyword that ranks among the top 10 keywords for a particular search.
Second, purchasing lesser used terms makes it more affordable to dominate a page of results. Retailers purchasing less popular keywords in addition to the most popular ones can afford to snare a larger portion of the paid search term results column.
"Using paid search to fill in the gaps for organic search can help retailers dominate a results page," explains iProspect`s Murray. "We help retailers find the sweet spots in their search marketing strategy."
One of the ways iProspect achieves this result is to test keyword performance by the time of day. Just as retailers attract shoppers that exhibit different types of behavior patterns throughout the day, so do search engines. In this case, shoppers exhibiting specific behavior patterns will respond to different marketing tactics.
Test, test, test
"We test keywords by the time of day and position for that time to determine when and in what position it is the most effective," says Murray. "This helps retailers compete in a more competitive keyword bidding environment and take advantage of search engine users` behavior."
Dominating a page using paid and organic search allows retailers to more effectively reach shoppers by presenting a combination of organic keywords that provide detailed content and paid keywords that are promotionally oriented. By achieving this balance, retailers can persuade shoppers that favor paid or organic search to migrate to the other on occasion.
"We have seen a 20% overlap between shoppers that use paid search and organic search," says 360i`s Williams. "In some cases, a shopper may start the search process by clicking on one type of keyword and then finish it by clicking on the other. Having a strong presence between paid and organic search prevents shoppers from becoming siloed when it comes to interacting with keywords."