Paid Search Spend Surges 27%, Mobile Grabs 40% Thanksgiving, Black Friday Spend

Amid reports that brick and mortar sales were lackluster over the Thanksgiving weekend, ecommerce is looking like a bright spot this holiday season, with mobile devices playing an increasingly important role.
Mercent, which powers major retailer campaigns online for brands including Brookstone, Office Depot and HSN reports same seller online sales increased 40 percent on Thanksgiving Day compared to 2012. Black Friday same seller sales hit a record high, increasing 35 percent

Paid search saw big increases in click volume and retailer spend. Retailers spent 27 percent more on paid search campaigns this Thanksgiving and Black Friday than in 2012, according to a new report from Kenshoo. Thanksgiving saw a 33 percent increase in paid search spend year-over-year, and Black Friday spend rose 21 percent from 2012.

“Kenshoo saw dramatic increases in paid search ad spend and online sales revenue on these two days signifying the peak shopping season is off to a hot start. With the 2013 calendar condensing the time between Thanksgiving and Christmas, we expect the torrid pace to continue,” said Aaron Goldman, Kenshoo CMO.
Smartphone and tablet activity grabbed significant spend share this season. Spending on Computers fell 24.1 percent from last year to 60.3 percent for Thanksgiving and Black Friday. Smartphone budgets shot up 79.1 percent to 21.2 percent of total paid search spend. Tablets saw search spend share skyrocket 113.6 percent to 18.5 percent of total search spend.

“It’s clear that the story of the shopping season to date is the mobile migration,” added Goldman. “In fact, this isn’t just a migration we’re seeing, it’s a full on revolution. With phones and tablets accounting for nearly 40% of all paid search ad spend on Thanksgiving and Black Friday, it’s clear marketers have multi-device strategies in place to lure consumers wherever and whenever they’re shopping.”

Mobile devices accounted for 44.2 percent of all paid search clicks in 2013, with 27 percent going to phones and 17.2 percent of clicks going to tablets. That’s up from just 27.7 percent of paid search clicks in all of November 2012, and 14.5 percent during the 2011 holiday shopping season.

Computers still dominate paid search revenue, though even that hold is slipping. Computer revenue share fell from 90.4 percent in November 2012 to 73.2 percent on Thanksgiving and Black Friday this year. The share of revenue coming through mobile devices increased 176 percent this year, with 22.4 percent from tablets and 4.4 percent from phones. Phone revenue is still relatively paltry. This year, though, tablets may have reached the tipping point as consumers are becoming more accustomed to settling in on the couch and shopping on their tablets in the evening hours.

Mercent saw Google Shopping growing faster than Amazon.com as a source of orders for their clients over the two-day period. Google’s efforts to provide more engaging shopping tools for consumers appear to be paying dividends.  Mercent reports that while Amazon grew 26 percent year-over-year on Thanksgiving, Google Shopping grew almost 70 percent.  The channels posted similar results on Black Friday.

When Should You Overhaul Your PPC Account Structure?

Let’s start by looking at a hypothetical scenario:

You’ve just been put in charge of a PPC account — either in-house or as part of an agency shakeup. It’s an account with a lot of history, and it is hitting goals, but…

After a few days spent familiarizing yourself with this account, you come to the conclusion that it’s not structured the way you would like. You sense a lot of opportunities for improvement: ad groups with too many keywords, budgets being eaten up by broad terms, keywords cannibalizing traffic from each other… and so on.

It’s at this point you need to come to a decision about how you’re going to move forward with the account:

• Start gradually tweaking things within the current structure to generate improvements?

- Or -

• Knock it all down and start from scratch?

Which would you go for?

This is a question we ask ourselves a lot when a new client comes on board, and it can be trickier to answer than you think. There are many different factors that determine which path to take. For one, building out a new structure is time-consuming. If the account is in good shape, you might be able to generate much better short-  and medium-term results by working with what you have. On the other hand, an account that’s in bad shape is going to be tough to work with and might not be able to hit the goals you’ve been given.
Some agencies will always redesign accounts completely from scratch. This can be helpful for a couple of reasons:

• You can easily train people to understand all the accounts you manage
• It speeds up repetitive tasks that are handled across a team of people

I’m not personally convinced it is always necessary or the right thing to do. If I came in as an in-house PPC manager, would my first actions be to tear down the current account and replace it with one I had built? Unless the account was in dire straits, probably not.

When Should You Restructure/Start Over?

I have a few personal metrics that I use:

• An account more than 25% away from goal that doesn’t show improvement month-over-month
• An account hitting goal that is showing non-seasonal, non-competitor related decline month-over-month for 3 straight months
• Accounts with median keywords-per-ad-group over 30

Is Restructuring Always A Good Idea?

There are two competing ideologies at play here: “PPC Best Practices” and business reality. Take a look at the following graph, which highlights what we typically see after an account restructure for an account that is in the “good, not great” mold:

Performance initially drops with the shakeup. New keywords, bids and ads all come into play. It can take up to a few months for performance to get back to where it was under the old system.

Accounts that don’t respond well to change initially seem to have a peculiar trait in common: a ton of history and very little activity. Huge accounts that have just kind of sat there for years with very few changes tend, for some reason, to give us the biggest headache. Internally, we speak of accounts having their own personalities. In this case, I picture a grumpy old man in his chair — when you wake him up, he starts cursing at everyone and heads back to sleep.

For the business side of things to go smoothly, you’ll need to project at what point you break even. Take a look at the cumulative frequency of conversions from the previous chart. The red line below represents overall sales had we not rebuilt. The blue line shows post-rebuild performance.
Notice there is a 6-week period in which our total sales were below expectations. I like to call this the “valley of client unhappiness.” The trick to surviving it is setting expectations, showing incremental gains every week and communicating constantly. Make sure everyone is aware of the long-term reasoning behind your account changes so there is a reduced chance of knee-jerk reactions.

Rules To Follow For Restructuring An Account

I went back and analyzed post-rebuild account performances for our clients. There was a fairly even split between this delayed improvement and immediate improvements being seen.
I’m sure a few of you, particularly within specialized verticals, haven’t ever had to deal with accounts that drop after “improvements.” You are either great at PPC or very lucky. For those of you like me who are neither, the following are the steps I put in place to maximize the chance of success with restructuring:

1. Make Sure Everyone Buys In
This is absolutely crucial if you want to succeed long-term. Sit down with your boss/client and spell out why you think the restructure is needed (it will improve long-term performance), what the negatives will be (short-term problems), and a rough approximation of how long it will be until this change pays off. If you can lay this out ahead of time, you won’t have to scramble to explain performance in the short term.
By ensuring you have buy-in, it also gives your boss/client another chance to stop you and say, “Hang on, we need every sale we can get right now, don’t blow things up until after Black Friday.”

2. Keep Bids The Same Where You Can
One of the simplest practical tips you can use when rebuilding an account is to keep things as similar as possible bid-wise at the start. New blanket bids will be much less efficient than ones that have been reached over months of tweaking.
I find the easiest way to do this is with a VLookup formula in Excel. Find out what your existing bids are and apply them anytime that same keyword and match type combination shows up.

3. Have An Overlap Period
Very rarely do I transition account structures without some kind of overlap period. This involves uploading the new structure without deleting the old. This allows time for my ads to start impressing and my image ads to be approved — and for me to fix any issues that almost always arise.

4. Recognize Your Failures
In business language, sticking with a failed change because you invested too much time and money into it is known as a sunk cost. Make sure your best AdWords efforts don’t turn into sunk costs of your own. Give your new account structure time to work, but recognize when it isn’t making things better. Typically, after a month or so, you should be able to tell if things are improving.
Along this train of thought, always download a backup of your account when you make big changes. There’s nothing worse than messing everything up and not being able to hit the reset switch.

5. Start With The Best Ad Only
If you want your restructure to be successful in the very short term, starting with only your historically best performing ad copy is a good way to go. By beginning with 3+ ad tests, you are dividing your new traffic amongst ads that might well be much worse. Typically, I tend to build out my ad testing with my structure, but then hold off uploading all but my best ad until a week or two later.

6. Put Top Keywords In Their Own Ad Groups
A lot has been made of single keyword ad groups in the past year, and personally I like them for my top keywords. By putting your top 100 or so into individual ad groups, you can check on them more easily and tailor better ads for them.
Adding “Important Keyword” labels is a really good idea, too — just in terms of keeping track of everything. You don’t want to think to yourself, six months down the line, “Hmm, I’m sure [x] used to be a really important keyword for us….”

7. Use A Consistent Naming Structure
There are many different ways to name your campaigns and ad groups. From the hundreds of accounts I’ve looked at, it seems like almost all of them do things slightly differently. Sometimes it’s “Nike – Shoes – Search,” other times “Google | Search | Brands | Nike | Shoes.” Keeping things consistent from the start is going to help a lot down the line (and it’s probably half the reason to restructure an account in the first place).
As always, I’d love to hear your restructure success and horror stories. Have you ever had troubles with changes you thought should have been massively beneficial? Let us know in the comments section below!

Google Introduces Change To AdWords: Pay By Viewable Impression CPM Bidding

Google rolled out a major change to AdWords this week by introducing CPM bidding by viewable impressions. This change was first noticed by Kim Clinkunbroomer of Philly Marketing Labs.

Rather than charging advertisers on the traditional model of served impressions, this change to CPM bidding means that advertisers will be charged based on ad impressions that can actually be viewed in-screen by users. All campaigns running on the Google Display Network will now have this option.

Ads are deemed viewable by Google’s Active View reporting. Previously advertisers were charged based on whether or not their ad was “served,” which wouldn’t necessarily indicate it was viewed by the end user.

This is huge for advertisers, as comScore recently reported that 31 percent of online ads go unseen by users.

Google’s Active View technology will now also include metrics reporting for advertisers which will track viewable impressions, viewable click-through rate and Active View average CPM.

Surprisingly, Google has made little mention of this change themselves. The move by Google towards having advertisers pay by viewable impressions will eventually become standard industry-wide.

In June it was reported by the Interactive Advertising Bureau (IAB) that marketers should be prepared to buy digital media based on viewability by the end of this year:

    The Media Rating Council (MRC) expects to lift its Viewable Impression Advisory by the end of this year, and at that time marketers will eagerly start buying digital media on viewable metrics. Publishers and agencies, we hope you’re ready.

With that being said, are you ready for this change to CPM bidding? Do you think it should become the industry standard sooner rather than later? Let me know what you think in the comments section.