Mobile accounted for 25% of Ulta's e-commerce revenue during Q2.
With recession-weary consumers curtailing their discretionary spending, retailers need to make every marketing dollar count toward a sale. That includes search marketing, which after years of being the rock star of retail marketing is expected to experience a decline in performance during 2009.
Despite the projected drop in conversions attributable to search, the medium is still capable of outperforming other marketing channels provided retailers closely manage their campaign strategies and tactics.
“Even though sales generated by search are expected to continue slowing in 2009, opportunities exist for retailers to get strong performance from their search campaigns,” says John Tawadros, chief operating officer of search engine marketing firm iProspect.
Indeed, consumers are still conducting product searches, but they are making purchases on a more selective basis, which means retailers are going to have to work harder to persuade them to buy. “Once retailers adjust their expectations accordingly, they can take the necessary steps to leverage their search marketing dollars more effectively in this economic climate,” Tawadros says.
Keep up with the changes
The first step is to stay current with search engines’ changes in how they weigh information pulled from retailers’ sites to determine search rankings and what they consider search-friendly URLs.
“Search engines roll out new enhancements every year and learning how to best leverage those features can deliver significant improvement in click-through rates and conversions,” says Suzy Sandberg, president of direct response online marketing firm PM Digital. “Retailers can always deepen their understanding of how the search engines do business and make better use of the tools they provide to grow their business and lower the cost-per-click.”
Understanding search engines’ ranking criteria is especially important for retailers that rely heavily on organic search campaigns, because in order to achieve a high ranking, they need to optimize the page content and links to those pages.
Google, for example, has altered how it weighs the number of external links to a web page as well as duplicate content on web sites when calculating organic search rankings, according to Rahmon Coupe, CEO of organic search services company YourAmigo.
“Retailers can have great page content and lots of backlinks, but if they are not current with the rules around the ranking algorithms their pages will not achieve a high ranking,” Coupe says. “In a down economy the focus for search engine optimization needs to be on maximizing traffic and overall sales at an acceptable return on investment. To do that retailers must keep up with the tweaks made by the search engines.”
One of the most effective ways for retailers to improve search engine optimization is through the use of long tail search terms, in which a searcher uses very specific queries such as “airline travel pillow” or “lightweight notebook computer” rather than more general terms, such as “travel pillow” or “notebook computer.”
Millions of keywords
With the long tail, the goal for retailers is to tap terms beyond the head of popular search terms to the tail that follows behind. “The long tail can represent 90% or more of sales made through organic search,” says Coupe. “One of the challenges with long tail search is to have systems in place which can scale and deal with millions of keywords, and in some cases, rapidly changing product inventory.”
The technology needed to manage the huge dictionaries of organic keywords and long tail search terms-which can be millions of keywords-is typically part of a retailer’s operating platform. Although many retailers are upgrading their operating platforms to run Web 2.0 applications, incorporating features to more effectively manage search engine optimization is not necessarily a priority.
“It is an easy trap to fall into because retailers get used to the limitations of their existing platform,” Sandberg says. “SEO management really needs to be a priority of any platform upgrade, whether the platform is hosted or operated in-house, because of the search engines’ changing rules and the increasing complexity of SEO strategies.”
Awareness of how competitors conduct search campaigns is just as important. Retailers constantly test new creative around both search optimization and paid search and tweak their dictionaries of search terms.
“Competitors’ campaigns must be monitored to understand who is in the marketplace, what type of creative they are using in SEO and paid search campaigns, how much they are spending on paid search, and what success they may be having for campaigns around similar products,” says iProspect’s Tawadros. “The more insights retailers have into what their competitors are doing, the more effective they can make their search campaigns.”
In some cases retailers may have no choice but to match the same creative used by competitors to ensure a high organic ranking. For example, a shopper entering the search term “ski bag” on Google will see a drop-down menu of several variations of that search term before they click on the search button. Those variations may include such terms as “ski bags on sale” or “ski bag reviews.” The shopper can select one of the alternative suggestions and receive search results that rank retailers incorporating those keywords in their search strategy at or near the top.
“If the retailer does not want to match a competitor’s creative they need to come up with alternative offers or content that produces a higher ranking,” says Tawadros.
Don’t always follow
With paid search, insights into competitor’s strategies can include tracking how many competitors are bidding for the same keyword and how aggressively they are bidding. “When several competitors are jumping into the bidding for a keyword and aggressively bidding for it, retailers need to ask themselves what is driving the trend and whether it makes sense from a business standpoint to follow it,” says Tawadros.
Services offered by iProspect include search engine optimization, paid inclusion management, pay per click management and shopping feed management, as well as the ability to take the pulse of the market every four hours by measuring traffic patterns generated by a competitor’s keywords, the prices paid for keywords, how many competitors are bidding for a keyword and whether they are going after like keywords.