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Many online retailers have hundreds if not thousands of products for sale on their sites.

For these retailers there is great value in using real-time pricing in their PPC ads to drive conversion.  

However, such a strategy can bring challenges for a team.

Such challenges include:

  • Keeping costs as low as possible, by buying product-specific keywords and model numbers,
  • Reducing wastage by bidding on keywords for products that are out of stock,
  • Limiting the amount of hours spent a week amending prices in ads to keep them updated.

So, if you stock lots of products but operate to low margins how can you overcome these issues to make real-time pricing work for you?

Utilising a product feed to revitalise your AdWords campaign performance

If you have access to a product feed you have a very powerful tool at your disposal which can be used in combination with Google’s API to revitalise your AdWords campaign performance.

From updating your ads in response to price and inventory levels to activating and pausing campaigns, eliminating the troublesome issue of appearing on terms for out of stock products.

We’ve used this technology across a number of our clients (which helped us get shortlisted for Econsultancy’s Innovation Awards in 2011) so, drawing on a case study for OYYY, who supply products such as printers, ink, toner and consumables such as laptops and projectors, let us see how this could work for your business.

OYYY’s challenge was to bring down the cost of sale of its PPC traffic to make it more profitable and look to grow it as a sales channel.

Unfortunately, the nature of managing thousands of individual products in AdWords made it hard to achieve the level of efficiency needed without additional help of some kind.

Step 1: develop a structure within AdWords that supports automation

For ease, it makes sense for retailers to have individual products created at ad group level which facilitates both the changing of prices via the feed, but also the pausing and reactivation of ad groups depending on stock levels.

For OYYY this meant creating several new accounts, one per product category, while at the same time working together to create a feed in the format needed for automation.

it was also important to ensure seamless integration with Google Merchant Center to use all the varying product extensions available in AdWords.

The task of turning this feed into keywords, ad groups and ads came next – helped by lots of careful planning and the judicious use of macros and technology to make it as quick as possible.

2: Integrate the feed with a real-time pricing and inventory management tool

Next we integrated the feed with a real-time pricing tool, customising the tool to look at the SKU in the product feed and matching this up with the appropriate ad group (which has the SKU in the ad group name) in AdWords.

For this case study we used our own tool developed by our in-house team, but there are other options for those looking for a standalone product or one integrated into a PPC management tool such as Marin.

The tool is programmed to look at the both the price in the ad and the stock levels. If the price needs changing, this automatically happens and if the item is found to be out of stock, the ad group is paused. If an item was previously unavailable but is now back in stock, the ad group is reactivated.

Our tool runs twice daily and importantly only pushes changes via the API where a difference is found, rather than rolling out all of the data in the feed.

This means that charges are only incurred where an ad needs to be updated, or ad group statuses changed. Over many thousands of products, this can help save retailers a significant amount of money.

Next Steps

OYYY is currently implementing this strategy across 16,000 of its products and is in the process of rolling it out across all of the 38,000 products.

To further aid campaign management, the tool will be able to flag up new products in the feed and add them to AdWords, but for now we prefer the control of doing this manually.

There is the potential to use this tool to aid bid management and automation, if desired. This will further simplify the job of managing such complex campaigns.

Results

So what results has this brought for OYYY?

In simple terms, whenever someone types one of the product part codes or keywords into Google, the OYYY ad shows with the exact price but more importantly, the ad is only delivered if they have the item in stock and it’s ready to ship.

This strategy brings advantages in delivering more accurate product extensions.

Often, when these are displayed in Google you are served a selection of products – here, only the exact product is shown, helping to further improve relevancy and decrease costs – with the same price listed in the ad above.

Econsultancy OYYY Real-time Pricing Example

In terms of KPIs, the biggest advantage has been a significant fall in cost per click (CPC). From a CPC as high as £0.80 on average for non-brand, this now stands at only £0.29 showing the savings that can be made by focusing on long-tail product terms.

The cost of sale has also been significantly improved and is at less than half of the levels seen previously. The same goes for cost per acquisition.

So, while today’s hot topic focuses on how to optimise the customer journey post-click; don’t forget it is just as important to ensure click activity itself is as efficient as possible.

Hopefully our case study has given you some ideas on how to do that in an extremely competitive sector. Do you have any other examples to share?

Arianne Donoghue

Published 21 February, 2012 by Arianne Donoghue

Arianne Donoghue is Head of PPC at Stickyeyes and a contributor to Econsultancy.

2 more posts from this author

Comments (1)

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Patrick Allingham

This is a great feature which works well for retailers – I recommend brands manually test workflows and record lift metrics to create the business case for the development of full automation.

Mediaplex has customised a similar solution within MOJO SEM, the Mediaplex search bid management tool used by Dell EMEA, wherein search ad-copy is dynamically updated with best price points and expiry dates of their products – this is now fully automated across 13 markets so the process can be run daily. Mediaplex customisation makes things easy for brands and is transformational to Dell’s paid search performance.

Check out the Dell Case Study here: http://www.mediaplexblog.co.uk/wp-content/uploads/2012/02/MediaplexCaseStudy_Dell.pdf

over 4 years ago

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