July 24, 2014, 12:04 PM

How luxury brands leverage paid search

New research shows luxury brands lag behind retailers in paid search advertising for the same categories and keywords.

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The top 10 retailers spent more on paid search advertising than the top 10 luxury brands in the apparel, cosmetics, shoes and watches categories—including spending nearly five times as much on the same luxury shoe keywords and two times as much on the same luxury cosmetics keywords.

New research from paid search firm AdGooroo found retailers—both authorized and unauthorized sellers of luxury goods—outspent luxury brands on paid search advertising in 2013.  Data came from monitoring more than 2,600 keywords on Adgooroo’s SEM Insight tool that tracks and analyzes paid search spending by keyword.  

The report says department stores—such as Macy’s Inc., Nordstrom Inc. and Saks Fifth Avenue—often spent more than luxury brands on keywords related to luxury goods. Discounters and resellers that sell heavily discounted or secondhand luxury merchandise also advertise heavily on these terms. Several Top 500 e-retailers rank among the top 10 retailer spenders on luxury goods keywords. Amazon, No. 1 in the Internet Retailer Top 500 Guide, tops retailer spending in the cosmetics category and appears in the top 10 among merchants for all five categories analyzed in this report. Macy’s, No. 8, appears in the top 10 in the cosmetics, shoes and watches categories. Nordstrom, No. 24, appears in the top 10 in all but the luxury watches category. Online marketplace eBay Inc. is among the top 10 advertisers for luxury watch terms.

Among brands, Chanel S.A., was one of the most aggressive paid search advertisers, showing up in the top 10 in all five categories and ranking first in cosmetics and handbags and second to Louis Vuitton Malletier S.A. in apparel.

Here are the top 10 luxury brand spenders in the apparel category, followed by their 2013 spend:

  1. louisvuitton.com, $1,316,000
  2. chanel.com, $549,000
  3. us.burberry.com, $323,000
  4. hermes.com, $265,000
  5. armani.com, $226,000
  6. us.versace.com, $190,000
  7. dior.com, $183,000
  8. armaniexchange.com, $98,000
  9. stellamccartney.com, $82,000
  10. gucci.com, $78,000

Here are the top 10 luxury retail spenders in the apparel category, followed by their 2013 spend:

  1. neimanmarcus.com, $770,000
  2. saksfifthavenue.com, $649,000
  3. nordstrom.com, $545,000
  4. net-a-porter.com, $375,000
  5. barneys.com, $345,000
  6. amazon.com, $283,000
  7. bergdorfgoodman.com, $281,000
  8. designerapparel.com, $236,000
  9. bloomingdales.com, $180,000
  10. sephora.com, $160,000

Here are the top 10 luxury brand spenders in the cosmetics category, followed by their 2013 spend:

  1. chanel.com, $311,000
  2. lancome-usa.com, $122,000
  3. us.burberry.com, $54,000
  4. shiseido.com, $49,000
  5. gucci.com, $38,000
  6. dior.com, $25,000
  7. giorgioarmanibeauty-usa.com, $19,000
  8. armani.com, $7,400
  9. marcjacobs.com, $7,000
  10. biotherm-usa.com, $6,000

Here are the top 10 luxury retail spenders in the cosmetics category, followed by their 2013 spend:

  1. amazon.com, $233,300
  2. nordstrom.com, $233,000
  3. sephora.com, $211,000
  4. macys.com, $207,000
  5. niemanmarcus.com, $117,000
  6. saksfifthavenue.com, $110,000
  7. frangrance.net.com, $103,000
  8. bergdorfgoodman.com, $53,000
  9. target.com, $41,000
  10. bloomingdales.com, $28,000

Here are the top 10 luxury brand spenders in the shoes category, followed by their 2013 spend:

  1. jimmychoo.com, $62,000
  2. ferragamo.com, $28,000
  3. christianlouboutin.com, $20,100
  4. gucci.com, $20,000
  5. lanvin.com, $17,000
  6. chanel.com, $17,000
  7. louisvuitton.com, $16,000
  8. michaelkors.com, $15,000
  9. brunomagli.com, $7,000
  10. jilsander.com, $6,000

Here are the top 10 luxury retail spenders in the shoes category, followed by their 2013 spend:

  1. saksfifthavenue.com, $204,000
  2. net-a-porter.com, $191,000
  3. barneys.com, $157,000
  4. neimanmarcus.com, $116,000
  5. nordstrom.com, $116,000
  6. bergdorfgoodman.com, $106,000
  7. designerapparel.com, $95,000
  8. zappos.com, $48,000
  9. bloomingdales.com, $29,000
  10. amazon.com, $20,000

Here are the top 10 luxury brand spenders in the handbags category, followed by their 2013 spend:

  1. chanel.com, $816,000
  2. louisvuitton.com, $576,000
  3. coach.com, $557,100
  4. marcjacobs.com, $414,000
  5. gucci.com, $173,000
  6. michaelkors.com, $144,000
  7. hermes.com, $102,000
  8. balenciaga.com, $76,000
  9. jimmychoo.com, $54,000
  10. burberry.com, $53,000

Here are the top 10 luxury retail spenders in the shoes category, followed by their 2013 spend:

  1. neimanmarcus.com, $480,000
  2. saksfifthavenue.com, $417,000
  3. nordstrom.com, $405,000
  4. amazon.com, $370,000
  5. bagborroworsteal.com, $254,000
  6. zappos.com, $229,000
  7. bergdorfgoodman.com, $203,000
  8. macys.com, $181,200
  9. bloomingdales.com, $181,000
  10. theluxurycloset.com, $135,000

Here are the top 10 luxury brand spenders in the watches category, followed by their 2013 spend:

  1. rolex.com, $149,000
  2. cartier.us, $95,000
  3. panerai.com, $70,000
  4. chanel.com, $69,000
  5. tagheuer.com, $56,000
  6. michele.com, $37,000
  7. movado.com, $35,000
  8. gucci.com, $34,000
  9. vacheron-constantin.com, $29,000
  10. bulgari.com, $28,000

Here are the top 10 luxury retail spenders in the watches category, followed by their 2013 spend:

  1. authenticwatches.com, $243,000
  2. amazon.com, $136,000
  3. worldofwatches.com, $93,000
  4. ashford.com, $62,000
  5. ewatches.com, $51,000
  6. macys.com, $47,000
  7. thewatchery.com, $46,000
  8. saksfifthavenue.com, $40,200
  9. ebay.com, $38,000
  10. ermitagejewelers.com, $36,000
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