E-Commerce Evolution: Beyond Traditional Search

If you’re responsible for supporting product sales through the retail channel for your client, there is no doubt you’re experienced in search engine optimization (SEO), search engine marketing (SEM), keywords, SERPs, ad banners, click-through rates and more. Most search activities involve either driving a consumer to the manufacturer’s site or to the retail site where the product is sold. Yet it’s what happens once a consumer gets to the retail site that is often the most important.

What Google and other search engines have taught us is that position matters. Think about the last search you performed on Google or Bing or Yahoo. Did you scroll beyond the first page? Probably not. The same is true on retail sites. Seventy percent of clicks on a retail site occur in the top 10 positions, according to Jupiter Research, now part of Forrester. Spending thousands of dollars to get a potential customer to a particular site means nothing if you aren’t seen once the target is there.

The lessons learned from search combined with proven in-store merchandising techniques are simple: The better the position, the better the results.

Consumers Are Evolving

Statistics prove consumers are changing the way they research and buy. Eighty percent of all product searches begin online, whether the product is to be purchased online or in-store, Envirosell and RichRelevance reported in early 2010.

The Web influenced $937 billion in U.S. store sales in 2009, Forrester reported, and that figure is projected to reach $1.3 trillion by 2013 — or about one-third of total retail sales. While it’s no surprise that search has become a more important part of the marketing mix, there have been some shifts in the past five years that marketers may not have foreseen:

  • Sixty-four percent of consumers are using multiple sources for their research including reviews, physical stores, online stores and search engines;
  • Site-side search on retail sites has improved dramatically, offering consumers a rich search experience without ever leaving a retailer’s site;
  • Twenty-four percent of consumers begin their search on retail sites, up from 21 percent a few years ago; and
  • Consumers now rely on retail sites more than any other source — in fact, 25 percent more than they rely on search engines.

Counter to conventional wisdom, searches are taking place well beyond traditional search engines. In fact, search on retail sites is a preferred first stop — even to search engines — so manufacturers and their agencies need to be evaluating how to make an impact on retail sites. The good news is this: Retail search behaves very much like search engine search, and it becomes a perfect extension. The message is not to reduce your search engine budget — it is to complement traditional search with retail search.

The cost of paid search has risen exponentially year over year, and brand marketers have paid dearly to rise to the top of search engine lists. Marketers find paid search to be effective — its pay-for-performance model and highly measurable ROI are more easily justified than cost-per-thousand-impression-based offerings and mass media.

What is becoming more evident, though, is that search engines only take your brand so far. It’s more critical than ever that marketers think beyond traditional search and evaluate solutions to capture consumer attention in the online storefront.

Searchandising – The Last Mile

When you are tasked to launch or support a particular product, it is important to look at each unique venue in which your product is being marketed and sold, and traditional search marketing efforts do this only to a point. As consumers are changing their shopping behavior, manufacturers are changing how they merchandise their products. One such way is through a technique called “searchandising” — the combination of on-site search and merchandising.

In the brick-and-mortar world, retailers pay for premium spots — such as eye-level shelf space, end-caps or kiosks — to increase awareness and actively engage consumers as they conduct product research or commence the purchase process.

On the Web, these premium positions are the top spots on the search results page, featured product zones, or any area where products are presented. Leveraging best practices from the merchandising world, where manufacturers vie for position, coupled with tactics from paid search, where position is proactively managed by the setting of a cost-per-click bid, product marketers can now work to boost visibility on retail sites.

The bid becomes a weighting variable in how search results are rendered, and for the first time, retailers are offering manufacturers an opportunity to enhance their positions.

Now you’re probably asking yourself, what is the difference if you approach the retailer and pay for advertising opportunities such as banners, sponsored sections, micro sites and brand showcases versus using CPC bidding? Well, for starters, consumers have indicated they want less — not more — advertising on retail sites. Second, in each of the other approaches, your message is adjacent to content; with searchandising, your improved positioning is the content.

Search results on retail sites that integrate cost-per-click bids have opened up as a branding and sales opportunity. CPC bidding offers you a pay-for-performance model: You only pay if a customer clicks on your particular product that has been better positioned via a CPC bid.

Remember, 70 percent of consumers are inclined to click on the top 10 search results on an e-commerce site, so it’s more important than ever that you advantage your product’s positioning. Unlike other online advertising opportunities, there is no new creative required. If you’re not searchandising, you are missing a critical final step to getting in front of consumers and ahead of competitors.

The Agency Opportunity

Search agencies are thought leaders. No one understands search and pay-for-performance like this group of nimble, innovative businesses. As retail search continues to establish itself as a viable way to extend a search program, use it as a means to deepen your client relationship and grow the overall search budget with which you work.

The planning, buying, reporting and optimizing of retail search campaigns can be managed by no one as effectively as the search agencies that established best practices for search marketers.

Search — it’s wherever and however consumers are looking for information. If agencies don’t own all of search, whether in traditional search engines or in the emerging vertical search categories like retail, someone else will.

Think of site search as part of your overarching search strategy, which represents a growth, not decline, in budget. Owning another piece of the search budget inevitably creates deeper ties with advertisers that don’t necessarily have the time to analyze reports and metrics, or don’t want to work one-on-one with retailers. If agencies don’t position themselves as being ahead of the search curve, someone else will.

Position matters, budgets are tight, and it’s a constant challenge to the search agencies to come to the table with new and innovative ways to impact their client’s customers and prospects, but by searchandising, you’ll find yourself — and your client’s products — in a better place.

John Federman is president and CEO of Searchandise Commerce. Check out the Searchandise blog and follow the company on twitter @Searchandise.

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