But the social network’s advertising revenue grew 18.4% during the quarter.
52% of Gifts.com’s traffic from Google in November was from Google`s content network, not Google.com. Separate campaigns balanced search ad spending between both venues.
Like most retail sites over the past holiday, Gifts.com got a lot of holiday traffic from Google, but most of that traffic wasn’t from Google.com – 52% of the site’s traffic from Google in the month of November came from Google`s distributed content network that serves up contextually relevant ads on Google’s partner publishing sites. Because the price of a click-through at that time of year from the content network was lower for Gifts.com on some of its core terms than from Google.com, Gifts.com could buy position on web search terms whose seasonally inflated bid price on Google.com was beyond the gift portal’s reach, according to vice president of product marketing and management Jenny Connelly.
Gifts.com is a gift recommendation engine that presents gift ideas to site visitors based on data they enter about the intended recipient. Visitors who find a gift idea they like click off Gifts.com to purchase the item directly from a retailer; Gift.com collects a fee on that click. Because it’s selling clicks to retailers rather than actual merchandise, Gifts.com is more constrained than a retailer in how much it can afford to profitably bid on search terms.
“”We’re not selling products – we’re selling clicks that go to somebody else. I can’t bid $2 on something like ‘Christmas necklace,’” Connelly says.
To drive the most value out of its keyword spend on Google, Gifts.com removed a selected list of its top keywords from automated bidding and manages bids on those terms manually. During the holidays it managed two campaigns for the same set of terms; one that tracked ad spending on Google.com and one that tracked ad spending on Google’s partner sites.
That strategy allowed Connelly to maximize the value of her overall holiday ad spend with Google by balancing the volume of traffic the site was getting at less cost out of Google’s network with the volume it was getting on its core terms at a higher price on Google.com, and balancing both campaigns against overall return on ad spend. While the constantly changing dynamics of bidder competition result in varying prices for keywords both on Google.com and the Google network, Gifts.com’s experience over the holidays was that it tended to pay a lower CPC on its core terms on the network.
For example, Connelly says that in November, her average CPC on Google’s content network was 22 cents while her average CPC on Google.com was 52 cents. During that time, the number of impressions – defined as the number of times Gifts.com’s listings were served on a search results page – was 128,403,487 on the content network and 17,871,879 on Google.com.
For Gifts.com, during the holiday season, “The content network is cost-effective because the CPCs are lower and as prices go up in the marketplace, there is a point where we can no longer bid on those terms,” Connelly says.