PPC Holiday Tips: It’s all about Execution

The Rimm-Kaufman Group manages paid search for a great many retailers across just about every vertical and the October pain was felt by all of them. We know that the stakes are incredibly high going into this holiday in particular, placing a premium on getting the details right. Here are some tips to help out.

1. Focus on the Core: Now more than ever it’s crucial to spend time and energy on what matters the most. In football, championships are won by the teams that do the best job of blocking and tackling. It’s not about fancy plays, it’s about execution. Focus on:
   • Paid search, not content ads: If you’re running content ads to the same efficiency targets as search it’s probably 5% of your spend at most.
   • Google, not Ask.com: This is not the time to test the latest wing-ding, and the newest engine. Let your attention follow the money you spend.
   • Competitive search, not brand search.
   • Keywords and bidding, not copy and landing pages

   Obviously, getting the promotional copy out appropriately is important, but not nearly as important and getting the bids and keywords right.

2. Keywords: “Christmas ornaments” and its cousin terms perform differently this time of year than any other. Pay attention to data from last Christmas as much as last month.
   • Are the right keywords with the right modifiers (with the right negatives) running?
   • Are keywords surrounding the new products up and active?
   • Watch out for keywords that were hot product last year that might be dogs this year — particularly those that you no longer carry!
   • Do you have systems in place to pull down keywords when products go out of stock?
   • The engines are likely to offer you robot-generated keyword lists to “help” you. Pass on this help. Google’s newly released Search-Based Keyword tool has raised the bar on these tools from Atrocious to Dreadful. The new tool recommended the keyword “handkerchief” for one of our clients…they sell musical instruments…
3. Bid for Efficiency: Avoid bidding wars. Don’t flush money down the toilet by engaging in positional warfare with competitors. Bid what you can afford for the traffic and let the position rise and fall. Don’t follow lemmings over the cliff.
   • Seasonal pushes and pulls. Study last year’s PPC data carefully. Watch for fairly stable overall sales per click numbers to ramp up and then collapse post holiday. This increase in the value of traffic allows you to bid more aggressively without losing money. On the flip side, it informs you how much to pull back and when once shipping deadlines end.
   • Manage the robot. Poorly designed bid systems only react to historic data and provide no opportunity to anticipate change. These systems, and the agencies who use them, will miss the holiday ramp up and hemorhage money after the holidays expecting the sales rush to go on forever. It happens every year, much to our amazement.
   • Dampen the day-parting. As the holiday approaches the time of day and day of week traffic valuations that make dayparting valuable during the rest of the year are buried by seasonality effects. Fridays may be bad days for you most of the time, but the Friday after Thanksgiving is different, and the Tuesday before Christmas won’t look much like a normal Tuesday in relationship to other days of the week.
4. Think carefully about efficiency targets: Ultimately, targets should be based on the margin dollars generated rather than top line sales. When the incremental margin dollars generated are in line with the advertising costs and your objectives for the program you’re on target.
   • Recognize that spending beyond the target may hurt the bottom line. Duh.
   • Recognize also that offers and discounts have exactly the same effect! That is, if you’re typically comfortable with a 30% cost-to sales-ratio, but everything is 20% off at Christmas, know that that cost to sales ratio either needs to be adjusted to compensate, or the bottom line is going to take a hit.
   • Beware of wishful thinking: You CFO might shrewdly argue that it’s not about percentages, it’s about the volume of margin dollars. “I’d rather have 10% of $1 million than 50% of $100”. This is true, but most advertisers are already spending upwards of 90% of margin generated on the advertising. Increasing bids 5% may get them a bit higher on the page, but effectively cuts their profits per sale in half! A 5% increase in bids isn’t likely to double the order volume. It’s worth playing with targets in the off season to find out that incremental ROI, but unless you’re running much more efficiently than most you may find that it’s an expensive lesson to learn right now.

I hope everyone has a better than expected holiday, both personally and professionally!

George Michie is Principal, Search Marketing for the Rimm-Kaufman Group, a direct marketing services and consulting firm founded in 2003. He regularly writes for the Paid Search column here on Search Engine Land.