|EcommerceBytes-NewsFlash, Number 3213 - December 09, 2013 - ISSN 1539-5065 3 of 3|
Digital marketing firm Kenshoo said advertisers saw fit to spend significantly during the traditional start to the holiday shopping season - Thanksgiving, Black Friday, and of course Cyber Monday.
The Product Listing Ad format (PLA) proved impressive on Cyber Monday. Kenshoo found retailers were rewarded with revenue from PLAs rising year over year by more than double. PLAs generated a 9 to 1 ROAS (Return on Ad Spend) on Cyber Monday 2013, though that was slightly down year-over-year compared to 2012. And it found advertisers overall spent 27 percent more on paid search year over year for this Cyber Monday.
For Thanksgiving and Black Friday, Kenshoo found retailers likewise spent 27 percent more on paid search this year than for the same two days in 2012. They also found big numbers in ad spend, clicks and revenue for smartphone and tablets; smartphone ad budgets enjoyed 21.2 percent of total paid search spend, and tablets 18.5 percent.
Kenshoo's Josh Dreller, Director of Marketing Research, answered some questions from EcommerceBytes.com about the advertising taking place for this opening period of holiday shopping:
EcommerceBytes: Were there more, fewer, or about the same number of advertisers spending on these ads?
Josh Dreller: Kenshoo performed a "same store analysis" - meaning that we only compared 2013 Kenshoo clients that also were clients in 2012 and spending during the holiday shopping season last year. Thus, it's difficult to accurately answer that question. What we do know for sure is that advertisers are spending more this holiday season than last year.
EcommerceBytes: Did the increase in spend come from having more ads in play and/or those ads being more expensive to buy?
Josh Dreller: Actually, the real driver in paid search spend has been the fact that more advertising dollars are flowing to digital. In fact, one out of every four advertising dollars goes to online marketing. Consumers behavior has shifted to more time spent online - via mobile, social, online video, etc. - and marketers follow their audiences wherever they migrate.
Paid search has historically generated a high return so it has warranted a lion's share of digital ad revenue (around 50% in aggregate). Basically, more dollars to digital marketing equates to more dollars to search engine marketing (SEM).
EcommerceBytes: Which ad categories received the most spend from advertisers?
Josh Dreller: The majority of the budget for SEM still goes to standard ads. However, product listing ads (PLAs) are capturing more interest from retailers. On Cyber Monday, for example, the advertisers analyzed who purchased PLAs both in 2012 and 2013 invested more than 2.5X this year than they did last year.
EcommerceBytes: Which ad categories performed the best during Thanksgiving, Black Friday and Cyber Monday?
Josh Dreller: Both standard paid search ads and PLAs performed very well in terms of total conversions, total revenue, and Return on Ad Spend (ROAS). As we reported on the Kenshoo blog, PLAs generated almost a 9 to 1 return on ad spend on Cyber Monday - even with retailers drastically scaling up their PLA programs on that day.
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About the author:
David A. Utter is a freelance writer based in Lexington, KY. He has covered technology topics from search to security to online business and has been quoted in places like ZDNet and BusinessWeek. He considers his appearance on NPR's "All Things Considered" with long-time host Robert Siegel a delightful highlight. Send your tips to firstname.lastname@example.org and find him on Twitter @davidautter and on LinkedIn.
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