Groupon says its focus is on the bottom line, rather than top-line growth.
That’s thanks to the retailer improving the efficiency of its paid search ad buys.
E-retailer Bag Borrow or Steal Inc. last summer analyzed its digital marketing program and determined its keyword buys were too narrow and failed to connect with potential targets, says Russ Blain, CEO of the e-retailer, which rents high-fashion handbags, jewelry and accessories.
“We didn’t think we were getting the job done,” he says. The problem, he says, was that the retailer’s ads weren’t relevant enough to the products sought by consumers.
To improve paid search results, the retailer began working with digital marketing firm DataPop whose Creative Science ad platform aims to match consumers’ search query intentions with relevant information. For instance, if a shopper searches for “Louis Vuitton bag” the vendor presents a paid search ad that says, “Louis Vuitton Handbags in 16 Colors like Turquoise, Tan and Red.” If she searches for “Louis Vuitton used bag” the corresponding ad says, “Designer Handbags and Accessories. 100% Authentic. New Events Daily!”
Haley Brothers, the retailer’s marketing director, works with a DataPop account manager to build a strategy based on Bag Borrow or Steal’s goals. The vendor then tests different versions of ad copy, an approach that’s yielded valuable information. For instance, the tests show that highlighting a range of colors and styles the retailer offers performs better than free shipping, at least in terms of return on investment.
DataPop encouraged Bag Borrow or Steal to expand its bidding on long-tail phrases, such as “Louis Vuitton used bag,” phrases that are cheaper than keywords like “Louis Vuitton.” Because fewer marketers bid to place ads with that include several words, the retailer was able to expand its keywords from about 1,200 to 12,000 without increasing its budget. And, for the same amount of money it was spending with its previous vendor, the return on that spending increased 31%. Moreover, a large part of that growth is thanks to it attracting new customers, says Brothers.