August 12, 2009, 12:00 AM

Top 500 retailers have a firm grip on paid search advertising

Top 500 retailers held 51 of the top slots in the paid search category, according to a study and ranking of keyword use by top retailers published in the 2010 Internet Retailer Search Marketing Guide.

Retailers and shopping comparison sites hold 51 of the top 60 positions in the paid search category, according to results of Internet Retailer’s exclusive study and ranking of keyword use by top retailers, published in the Internet Retailer Search Marketing Guide.

In paid search, Lowe’s Cos. Inc., No. 76 in the Internet Retailer Top 500 Guide, was the leader with four spots, Sears Holdings Corp. (No. 2 in paid search and Top 500 retailer No. 7) held three and Amazon (No. 3 and Top 500 retailer No. 1), Target Corp. (No. 4 and Top 500 retailer No. 20) and The Home Depot Inc. (No. 5 and Top 500 retailer No. 43) showed up in two positions, according to results of Internet Retailer’s study of keyword use by 250 top retailers, which are featured in the Search Marketing Guide.

Many retailers in the Internet Retailer study have become adept at paid search marketing, as evidenced by where they appear in the paid rankings. In the highly competitive Apparel category, the top three positions were held by Victoria’s Secret (Top 500 retailer No. 19), Ann Taylor Retail and Jos. A. Bank, numbers 108 and 189, respectively, in the Top 500, and the remaining top 10 also were retailers. On the natural side however, online encyclopedia Wikipedia held the top position, followed by J.C. Penney Co. Inc. (Top 500 retailer No. 15) and Amazon. Not one of the top three in paid search appeared in the top 10 positions of natural search results, even though all but one of the natural result leaders were retailers. Only J.C. Penney and Nordstrom Inc. (Top 500 retailer No. 32) appeared in the top 10 in both paid and natural search.

Retailers’ keywords bids include the mundane, such as varied spellings and misspellings of their company name, the creative and brutally honest. For example, WorldJewels.com’s list starts with “earrings,” “rings” and “wedding bands,” but also includes a key phrase for many engaged couples these days: “cheap wedding rings.”

In some cases keywords go from fairly specific to precise. For instance, top keywords for No. 70 sports collectibles and fan merchandise retailer FansEdge Inc. (Top 500 retailer No. 217) were “replica jerseys” and “sports hats.” The retailer’s additional keyword list included “Bobby Orr jerseys”-celebrating the iconic Boston Bruins hockey player of the 1960s and 1970s, sandwiched in between variations on the company name and “NBA jerseys.”

Paid keywords and phrases have proven their worth in terms of driving traffic and sales, building brand awareness and blocking competitors from bidding on certain words. Whether retailers of all sizes can take advantage of such tools depends on their goals, says George Michie, principal at The Rimm-Kaufman Group, an e-commerce consulting firm.

“Like any technology issue, how much information technology retailers can put into paid search depends on what value they are going to get out of it,” Michie says. He contends that a big commitment to paid search is less a function of the size of a retailer’s business than the size of the marketplace. “That’s the opportunity in paid search,” he says. “We work with some very small companies for whom paid search drives 60% of their business, but it’s very big for them and they spend a lot of money on it.”

One example from the research is web-only automotive parts retailer AutoAnything (Top 500 retailer No. 204), which ranked in the top slot for the keywords “auto accessories,” outbidding Whitney Automotive Group (Top 500 retailer No. 115) and The Auto Doctor, and in the third positions for keywords “car air filters” and “truck accessories.”

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