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4 Powerful Use of Google AdWords for E-Commerce

March 26, 2014 EC Milo Category : , , , , , , , ,


At SearchGuru, we have extensive experience working with e-commerce stores on SEO / SEM in a variety of verticals and with combined sales to the tune of tens of millions of ringgit a month. Some of the notable clients include AirAsia, RedMart, Luxola, HiShop, The Luxe Nomad and Times Bookstore's NoQstore.

In this article, I share "4 powerful use of Google AdWords for online stores" based on our experience. If you are currently running an AdWords campaign, I encourage you to compare your numbers to the ones I am sharing below.

 Powerful use of Google AdWords for E-Commerce


1. Acquisition


AdWords is a powerful and important channel for e-commerce sales and new customer acquisition. By targeting related keywords, one is able to display advertisements on Google's search results, only to intended audience. This helps cut down on wasted ad spend, and also results in a much higher conversion rate and ROI respectively.

On average, AdWords contributes between 10% to 25% of our clients' monthly sales revenues. Even if the clicks do not result in an immediate conversion, they assist quite a bit in converting returning visitors. AdWords also drive between 30% to 50% of new visits to our clients' stores.


2. Branding


Although you are able to reach out to a more targeted audience with AdWords, you should not expect to have lots of sales and make big profits immediately. Just like in the offline world, the rules of PR and branding also apply in the online world, i.e. you need to spend time and money to build a brand that people can trust and associate with.

We have seen sub 1% average conversion rates for new e-commerce stores with very niche products to almost 9% average conversion rates for established or branded stores - most e-commerce stores should be in the 2% to 3% range.

AdWords allows you to achieve this with affordable and controllable budget via their Display Network using text ads, banners, videos and more.

In addition, one of the AdWords features - Remarketing allows you to target visitors who have visited your website, and "follow them with ads" when they visit any website on the Display Network. This works on the premise that over 90% of your website visitors do not convert the first time, i.e. they will leave to do more product research, compare prices, etc.

In short, Remarketing allows you to:
(a) remind them about your brand, giving you a second shot to convert them.
(b) instill perception that you are a big brand by having ads display "everywhere".

Increase of CVR over the time with AdWords

For a perspective on the time and cost required for branding, it took a client two and a half years with over S$300,000 spend (on AdWords alone), to grow the average conversion rate from 0.5% to 9.0%. As you can see from the chart above, the doubling in the conversion rates from 2% to 4% happened at the same time there was a jump in brand interest in Month 21/22.


3. Brand Defense


About 30% of your visitors, including Returning Visitors who are existing customers, access your website by searching for your company brand on search engine rather than inputting the website URL directly into their Internet browser. This is known as navigational search.

To illustrate my point, below are the monthly search volume for some brand keywords (including common variations) in Malaysia:

  Brand Keywords     Monthly Search Volume  
Air Asia > 2,200,000
MPH Bookstore > 40,000
Zara > 40,000 
Fitness First > 15,000
Exabytes > 5,000

Your competitors are able to target your brand in their campaigns, in an attempt to steal away your potential customers. Although your website is likely to naturally rank #1 for your brand in the organic results, your visitors might still see your competitors' ads first, since Google allows up to 3 ads above the organic search results.

You may ask yourself, "will my visitors get attracted to my competitors' ads when they are looking for my website?"

Unfortunately, the answer is yes! In fact, you don't only lose website traffic to your competitors, but sales too. Our clients have experienced an e-commerce conversion rate of up to 15% by targeting competitor brands. You can expect an even higher conversion rate if both of you are selling non-exclusive products say, a book or a bottle of Spritzer mineral water.

Hence, it is important to also target your own brand in your AdWords campaign. In most cases, you will pay a lower CPC (cost-per-click) than your competitors, and your ads will enjoy a much higher CTR (click-through rate) and Quality Score - helping to increase your overall account Quality Score in the process.

However, like your competitors, you should target their brand keywords in your AdWords campaign to steal away their visitors too.


4. Testing and Research


AdWords is a quick and affordable source of traffic for testing and research purposes, to give you an idea on real user responses before implementing your ideas for your business.

In one example, we used it for a client to test the effectiveness of free delivery. What we did was driving traffic to two different landing pages - free delivery with minimum order and free delivery with any amount. In the end, our client discovered that free delivery for any amount works best for their business.

Another example is to use AdWords to research the business potential, e.g. through an online survey. What we did was driving visitors to a survey form about buying health supplements online and promised them a RM50 voucher in return. In just 2 weeks, we were able to acquire over 250 survey participants.

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About the Author

Larry Lim has been consulting on SEO and SEM since 2005 and he is the co-founder of SearchGuru, an online marketing agency with a presence in Malaysia and Singapore. SearchGuru is also a Google Partner and managed about RM10 million in Google AdWords spend in Q4 2013 alone.

SearchGuru's clients include AirAsia, The Star, Astro, PropertyGuru, Exabytes, UOB Bank, Eu Yan Sang, British Council and ServCorp.

For questions, feel free to drop me an email at larry@searchguru.com.my or call +603-2035 9667.

Disclaimer: This post is sponsored by SearchGuru.

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