When you bid on all traffic together, you push down all bids to account for poor performing queries. The problem is, you also unnecessarily penalize good performing queries. This is why segmenting by brand and non-brand is vital as this traffic performs quite differently. Separating this traffic enables you to bid manage much more strategically by allocating cost more precisely across the entire PLA program. For example, if you need to pull back on spend or adjust to meet a goal and your brand traffic tends to perform well at a low cost, this allows you to keep brand traffic consistent and just pull back on non-brand, which tends to be more expensive.
Retailers with a large number of branded products as well as those who carry products with high brand recognition may find it advantageous to take segmentation beyond just brand and non-brand. Many of them may benefit from looking at traffic for specific manufacturers, brands, and categories to see which are selling as opposed to just general search terms. As with any strategy this won’t be the case for all accounts however, for some it has proven to be highly effective at reducing costs and increasing revenue.
Consider how customers search for products on your site when determining which segments will be most valuable. Product and customer behavior varies widely for each site, even between owned properties that sell similar products, so having a solid understanding of product and customer behavior is an important first step to establishing effective PLA segmentation. For instance, start with categories or manufacturers that are very popular for a given site.
Utilize these highly segmented product targets and incorporate them into your bid management to optimize spend allocation, effectively increasing revenue while decreasing cost. Bid aggressively for traffic segments based on your top selling products as they typically have much higher click through and conversion rates. Always ensure that your top brands and categories have strong bids, regardless of category bids, to remain competitive.
An easy example to help illustrate this is work we did for a high-end apparel retailer who sells a wide variety of designer products. We got started by segmenting out traffic based on top designers. Next, we utilized campaign priority settings and negative keywords to divide traffic into meaningful segments and manage bids separately.
Often times retailers establish different goals for specific segments of traffic and are willing to accept a lower efficiency in exchange for brand awareness and new customer acquisition, allowing them to remain more competitive. This is especially true early in the holiday season when consumers start to research products online.
We will cover this topic and more in detail in our upcoming webinar with Google titled PLA 2.0: Strategies to Optimize Your Program, and Your Performance. We’d love for you to join us!