Retailer performance, store productivity and consumer spending

ChannelAdvisor on Where Retailers Should Place Search Ads

0716121121_Wingo_Scot2_interview

Scot Wingo
CEO
ChannelAdvisor

Scot Wingo’s consultancy ChannelAdvisor has been analyzing results and making recommendations to its clients on digital and ecommerce efforts for more than a decade. With a specialty in ecommerce search marketing, ChannelAdvisor has been advising retailers and brand manufacturers on how to best use Google, eBay, Facebook and Amazon.com search. The CEO spoke with eMarketer’s Christine Bittar about search-triggered ads on Google and strategies for marketers.

eMarketer: How do you feel about the environment for marketers interested in search and search-launched ads?

Scot Wingo: Google has really changed the playing field with product listing ads and Google Shopping. In a way they’re married together with PLAs as a monetized bidding mechanism. Google has been under some pressure from Amazon and the Amazon buying experience from the user perspective, and Amazon appears to be taking share—at least for product-oriented search—from Google.

eMarketer: What retail segments are using Google product listing ads the most heavily and in what instances are PLAs most useful?

Wingo: The big categories for PLAs are apparel, consumer electronics, sporting goods and home and garden. Consumer electronics marketers started earlier than other categories, and seem to be very transactional in advertising.

From the consumer standpoint, they’re most often buying lower-end products through the PLAs—that would basically mean products sold for $100 or less where shoppers are more interested in buying something quickly. Because of that, the conversion rate seems to be higher for low-priced products.

eMarketer: What about mobile search vs. desktop search? What are you seeing in terms of usage?

Wingo: Mobile accounts for about 30% and it jumped up to about 40% during the holidays last year—which we know is about showrooming and couch commerce.

eMarketer: What about cost? Are Google PLAs more or less efficient than other types of search marketing?

Wingo: PLAs are actually a bit more efficient than Google AdWords and they have a higher conversion rate. A shopper gets more information from a picture ad than a textual ad so we’re very strong proponents of it.

Google’s PLAs are also one of the few places on the internet where a smaller advertiser wouldn’t have to compete with Amazon. Even though Amazon is a huge advertiser for Google, for competitive reasons it made the decision not to run PLAs, which means there’s an opportunity there for the other advertisers.

eMarketer: What about the price structure for the small to midsize advertiser?

Wingo: Since there are fewer advertisers in the program, companies using that platform find they’re getting a very good ROI (return on investment) because there’s less competition and also because of the conversion rate.

Still, I’m biased and I recommend not one or the other but both PLAs and AdWords together. I really don’t see a scenario where a company should not be using both.

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