PetSmart acquired Pet360 for $130 million in cash and up to $30 million more in future performance-based payments.
That enables a retailer to more accurately gauge the impact of paid search ads.
Mercent Corp. plans to launch a new platform next month that aims to offer online retailers insight into what products consumers are buying when they click on a paid search ad.
The offering, which Mercent has been testing with retailers such as outdoor athletic apparel retailer Gear and Training, synchronizes a retailer’s paid search campaign with its product inventory levels by placing tracking tags that identify each ad. Mercent then can see what a consumer who clicks on an ad ultimately purchases.
Mercent can then report to retailer clients the products that convert best with particular ads, as well as which ads lead to the most sales for a particular set of product SKUs.
That insight is particularly important because what a consumer searches for often doesn’t correspond to what she actually buys, says Eric Best, Mercent CEO. For instance, for many of Mercent’s retailer customers more than half of the revenue generated from comparison shopping engines is from consumers purchasing products other than what they searched for on the shopping sites.
In paid search that phenomenon may at times be even more pronounced. That’s because even when a consumer does a granular search for a product such as a “North Face jacket” he is often presented with ads that relate to the category, brand or season, such as “70% off Jackets & Apparel.”
Mercent’s offering aims to help retailers better understand how consumers interact with search ads, says Best.
“The whole retail calendar is oriented around sales promotions, sales events and seasonality,” he says. “For each one, we enable a retailer to reverse its work flow. So rather than start with an ad campaign, retailers can start with the products first. If a retailer knows that its biannual sale is coming and 5,000 SKUs are part of the event it can work backward and identify which ads have been most effective at selling those products that are the focus of that event.”
Mercent’s offering allows retailers to automate their campaigns. That means that a retailer can set a beginning and end date, as well as input rules so that Mercent’s system can automatically adjust the ad copy and keyword library based on consumers’ interactions with the ads.
For Gear and Training, which previously manually managed its keyword campaign on its own, Mercent’s new service has saved hundreds of hours, says owner Stephen McCarthy. “Handling my paid search campaign on my own I knew I was leaving money on the table because I didn’t have the time or information to optimize my efforts,” he says.
Since implementing Mercent’s new paid search platform last May the retailer has seen a 38% increase in its paid search traffic, which has resulted in a 10% jump in paid search-related revenue.
Mercent charges a monthly fee for the service, starting at $2,500, and takes an undisclosed revenue share. Mercent says it typically takes one to two weeks for a retailer to get its program up and running.