After the cost of Google AdWords search keywords had climbed to more than $20 per order, office supplies e-retailer Databazaar.com worked with an outside partner to cut its per-order cost by more than 40%, David Cohen, vice president of marketing, tells InternetRetailer.com.
“Our cost per order was up to $23 or $24, it was killing us,” Cohen says.
But since June, when Databazaar began working with search engine marketing firm NetElixir Inc., the retailer has cut its per-order search marketing costs to about $14, Cohen says. “Now we’re working on getting below $10,” he adds.
Databazaar has been selling online for eight years and expects to do close to $35 million in sales this year, up 10% from 2005, Cohen says. It attributes much of its growth to a strong focus on customer service, including free shipping on all orders to the U.S. and U.S. overseas military bases. But to maximize profits along with that growth, it kicked off a strategy earlier this year get more out of its search marketing expenses.
After trying other attempts that failed to cut search costs, it turned over the search marketing for its 5,000 products to NetElixir. “They have free range to come up with different keywords for each product,” Cohen says.
Through a combination of using web analytics and A/B testing to show how well keywords are performing in relation to sales, NetElixir will add or delete keywords and adjust prices paid for keywords. In some cases, for instance, it will pay less for paid search if products are getting more orders through natural search. In other cases, it will either insert or delete Databazaar’s retail prices from AdWords text based on performance levels.
NetElixir provides daily reports on Databazaar’s search marketing costs, including the number of keywords that converted to orders. Databazaar conducts a monthly meeting with NetElixir to review data and decide if it wants to modify overall search marketing strategy, Cohen says.
Three months after starting with NetElixir, Cohen says, Databazaar has increased its average number of orders through Google AdWords by 50%. “Every month our orders go up, and our cost per order goes down,” Cohen says.
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