Headline Feeds
For Thralow, Inc., the majority of its e-commerce customers come from two sources: Those who go directly to its various sites, including binoculars.com, and telescopes.com, and those who find it through Google's (Nasdaq: GOOG) AdWords listings.
"When somebody goes to Google and types in 'Nikon Monarch binocular' they are ready to buy," said Jon Thralow, director of technology and marketing at the Proctor, Minn. firm, which has made its way onto the Inc. 500 list of fastest-growing private firms for the second time this year. "That's the kind of traffic Google drives to us."
Strategic Spending
For that reason, Google AdWords makes up the largest portion of Thralow's marketing 
budget. In addition to the strong quality leads, the firm likes the flexibility of the online keyword buying system. "I probably log on and manage our AdWords at least twice a day," he said. "We are constantly making sure our keywords are working the way we thought they would and making adjustments based on our inventory."
Heading into the holiday season, hundreds of businesses are expected to follow Thralow's example, using AdWords from Google and similar products from Yahoo (Nasdaq: YHOO) and others to drive high-quality traffic to their sites.
And because the products offer flexibility, real-time reporting and other features, the retailers will be constantly adjusting their campaigns to make sure they are advertising the hot items and selling inventory that's stacking up.
David Fisher, director of the Google AdWords program, told the E-Commerce Times that Google advises businesses to put themselves in customer's shoes.
"They've got a lot of shopping to do, a big list, they want to bang it out as quickly as they can," he said. "Maybe an e-tailer has a holiday deal or a shipping offer, they should target that. They should think about their customers and how they might be thinking."
Growing Up
Though Google and its rivals don't pinpoint forecasts, keyword ad spending is expected to surge this holiday season along with e-commerce itself. The ever-important holiday season may even get an extra boost this year, with some analysts predicting that surging fuel prices and other factors may prompt more shoppers to turn to the Internet for more purchases.
Continuing to grow at the historic rate will be harder for e-commerce, which topped US$23.2 billion in 2004, excluding travel, a 25 percent increase over the year before.
"Businesses have been ramping up for a few weeks now," said Fisher. "We certainly see that every year around this time. As we get into the beginning of the fourth quarter, they really start to think about gearing up. We start to see people approaching different ways and different keywords getting more interest."
Fisher said again this year AdWords will benefit from being suitable for businesses of all sizes, including small specialty retailers who might not otherwise be able to drive significant traffic to their niche sites.
"We have really big names, huge retailers, down to small little mom and pop stores that might even be people selling out of their own houses," he said. "The beauty is they can compete for the same keywords."
Being able to target certain ZIP codes or geographic areas or to run national campaigns also attracts advertisers as does the ability to cap daily click-through spending, which offers small businesses with limited budgets some assurance they won't run over at a critical time.
Flexibility the Key
Fisher said the ability to quickly react to trends is another selling point of the keyword ad approach.
"Every year there's that one big item and often it's a surprise as to what it is," he said. "Once you notice that trend you can change your keyword mix to take advantage of what you have to offer."
The system also has built-in flexibility on specific keywords, with the ability to insert different ad copy on the same keywords. With real-time reports on what ads are driving clicks to a site, successful copy can be expanded while other creative not performing as well is dropped.
"You can update based on where you are for your business, down to the hour or day," Fisher added, meaning that early shoppers and last-minute shoppers can be targeted with different copy or offers on the same keywords. "The beauty of AdWords is that you don't have to lock in weeks or months ahead."
For Thralow as for many other e-tailers, the stakes are higher than ever heading into the last eight to 10 weeks of the year.
"This is our season. This is the one that makes or breaks our year," said Jon Thralow. "This is the time of year when no one sleeps."
But armed with the hottest online advertising tool, Thralow hopes to make all those sleepless nights worthwhile. "We've got our keywords in place and we're ready," he added.
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