The new payment option from Samsung gives retailers another way to connect with customers.
Large merchants are casting a wider net for general high-traffic paid search terms.
For this year’s Internet Retailer keyword analysis, search engine marketing research firm Conductor Inc. studied more than 2 million keywords and paid ad positions to estimate monthly pay-per-click spending for the 250 biggest merchants. Among big chain retailers, Target Corp., spends an estimated $5.06 million each month on pay-per-click campaigns, while Amazon, the top web-only merchant, spends an estimated $4.76 million. In comparison, Dell, the highest ranking consumer brand manufacturer, commits an estimated $2.22 million each month, while the largest catalog/call center company, 1-800-Flowers.com Inc., spends an estimated $1.64 million every month.
Paid search also makes up the biggest portion of marketing budgets across all types of retailers, according to Forrester Research Inc.’s “The State of Retailing Online 2010: Marketing” report commissioned by the National Retail Federation’s Shop.org division. For instance, apparel, accessories and footwear retailers allocate 42% of their total marketing budgets to paid search; beauty and personal care retailers allocate 43%; general merchandise retailers, 39%; home retailers, 34%; and sporting goods and accessories retailers, 44%, says Forrester.
With more large web retailers casting a wider net for paid search terms, it’s becoming more difficult—and expensive—for smaller web retailers to purchase high-traffic and category-specific keywords an extended period of time. In the hardware category, Sears, which Conductor estimates spends about $1.15 million each month on pay-per-click marketing, consistently controlled hardware keywords and phrases such as “Hand Saws” and “Wrenches,” according to research featured in the Search Marketing Guide.
In accessories Fossil Inc. was the most consistent bidder for category keywords that include “Belts,” “Wallets” and “Watches.” “There’s a gap in paid search spending between the biggest online retailers and everyone else and it’s only going to get wider,” saysUdayan Bose, founder and CEO of NetElixir Inc., a search engine marketing firm. “The biggest merchants have the budget to bid on more expensive general category keywords and phrases and use them more consistently over time and that puts smaller players at a big disadvantage.”
Data in the Search Marketing Guide also suggest that unlike smaller web retailers, who often will pay a premium for a category-specific keyword to generate traffic and sales for their current pay-per-click campaigns, big retailers are holding onto general merchandising paid terms longer in order to break down sales channels and study other key marketing trends.
“The analytics technology has become so advanced and paid search so important that many of the biggest merchants are purchasing high-traffic category words and phrases more consistently, and taking a longer-term view of how those terms are performing,” says Jamie Smith, CEO of search marketing agency Engine Ready Inc. “They want to know how those terms generate sales across multiple channels and how they impact customer buying behavior, especially for new products.”