Retail Performance Marketing - The Mercent Blog

Mercent Product Syndication for FiftyOne Ecommerce Clients – A Top Ten List of Benefits

As an established FiftyOne partner, Mercent offers ‘turnkey integration’ with the FiftyOne platform – providing retailers native syndication of FiftyOne-localized currency and data within Mercent shopping feeds and product syndication service.  We see important reasons for retailers to standardize all online product advertising, marketplace integration, product syndication, data feed marketing, and paid search optimization on our SAAS platform -- Mercent Retail – to derive the most value from their international eCommerce efforts. 

This said, I’d like to share our ‘Top Ten Retailer Benefits’ for retail programs unified on the Mercent Retail platform.  The end goal is to enable retailers to make the most informed decisions regarding when and how to engage global retail advertising channels to acquire new customers and orders. 

Ok, here we go!

10.  Mercent support for alternative fulfillment solutions such as international Fulfillment by Amazon (FBA): If you elect to move product to non-US distribution centers such as Fulfillment by Amazon in Europe, Mercent Retail facilitates data communication and workflow management of the FBA program -- alongside FiftyOne of course.

9.  Mercent Retail market price and offer intelligence: Mercent collects competitive price and offer intelligence on behalf of our retail clients on up to 1 million product SKUs across the Mercent Retail platform with more than 200K SKUs priced per hour to help inform your pricing and offers.

8. Mercent Performance – a proven cross-channel marketing agency: Mercent Performance is your expert on-call team of professionals dedicated to helping our clients implement and manage cross-channel digital advertising programs for the world’s largest retailers.  Our specialists come to Mercent with tenure managing programs at Amazon.com, leading digital agencies, and major ecommerce success stories.

7.  Channel-by-channel real-time assortment control: Mercent Retail dynamically adjusts the product assortment syndicated to any engine or marketplace as often as every 10 minutes (depending on marketplace / channel capabilities) based on performance inputs such as return on advertising spend, gross margin per order, and other metrics that combine the state of the product in your warehouse or 3P fulfillment center with our real-time analytics

6. Channel-by-channel data SEO: Don’t blindly syndicate product data to any advertising channel without optimizing for performance. SEO tactics should start with your catalog data feeds and end with your product landing pages.  Every shopping engine and marketplace operates as a specialized shopping search engine, with up to 90% of transactions driven by consumer site searches on these channels.  Mercent provides search optimization by region / channel at scale to ensure your product data visibility is maximized uniquely on each site. 

5. Channel-by-channel offer customization: As you expand your global marketing footprint, regional markets will perform better with specific merchandising offer and marketing campaign optimization.  Mercent Retail provides content and offer optimization by region / channel – allowing you to tailor your offers and content around regional sales promotions, loyalty programs, and other merchandising messaging for that specific market.

4. Mercent Retail product category mapping: Mapping products to the correct location on shopping engines and marketplaces is a painful and time consuming process.  Mercent Retail makes it easy by providing tools that facilitate fast mapping at scale, and which minimize future maintenance overhead by establishing flexible channel-specific mappings at the category and product level.

3.  Mercent Retail product matching and attachment: Major marketplaces and shopping engines have implemented a “single detail page” or “product detail page” product authority model.  This means consumer visibility for your products requires accurate association with the correct SKUs or ASINs on Amazon, eBay, Google Product Search, etc.   Mercent Retail provides high-volume tools and workflow to simplify this process ongoing.

2. Mercent Retail channel error resolution: Mercent provides automated, scalable tools and workflow for marketplace error resolution to resolve data, categorization, and product matching errors that occur as you seasonally churn products, categories, brands and suppliers through your catalog. Our ongoing process makes it possible for you to be visible and competitive with your products and offers on every channel to maximize revenue and ROI.

1. Mercent Retail cross-channel analytics: Where’s your least expensive opportunity to acquire another customer or order in a regional market?  Mercent Retail makes it easy to find out and target that assortment and channel.  Reconcile all domestic and international cross-channel revenue, units, and profit margins with ad spend.  With Mercent Retail, you know the exact cost and return of each transaction acquired through paid search, comparison shopping engines, transaction marketplaces, affiliate networks, social storefronts, and mobile shopping presence. 

We look forward to serving even more enterprise retailers in partnership with FiftyOne.  For merchants, hopefully this post serves as a checklist to refine your demand generation approach to marketplaces, shopping engines, paid search campaigns, and other product syndication targets!  Last, for more information on the Mercent Retail SAAS platform and Mercent Performance marketing agency services we welcome you to drop us a line.

Eric Best

Mercent CEO

 

 

 

International eCommerce in Partnership with Mercent and FiftyOne

Greetings from jet-lag city New York!  I, along with Mercent’s VP of Sales Aimee Pierce, just returned from the FiftyOne Global eCommerce Forum.  FiftyOne has a great core business and a big future vision for retailers.  It’s apparent that as FiftyOne expands their platform and services to include product syndication, integration with global marketplaces and launching their own consumer-facing shopping destinations, FiftyOne customers will have increasing choice and flexibility about where and how to syndicate product data and engage consumers on a global scale.

We were honored to join a group of dynamic presenters that included entertainer John Hodgeman who spoke about international travel, and FUBU founder Raymond John who shared key insights on entrepreneurship and business management best practices.  I was able to also take the stage to lead a session covering retail demand generation in international markets and key insights on retail paid search (SEM / PPC), product syndication and paid and free data feed and shopping channels – all of which are part of Mercent’s core competencies and strategic focus for the company. I am following today’s blog with additional details on the event, including a “Top Ten List” of benefits FiftyOne retail clients will see if they standardize their online product advertising, marketplace integration, product syndication, data feed marketing, and paid search optimization on our SAAS platform -- Mercent Retail.  Tune in tomorrow for the list!

I’d like to extend our thanks to Brian Walker at Forrester, our Wall Street research analyst colleagues at Citi, JP Morgan and Jefferies, along with Covario for their support in augmenting our international ad market data. Mercent’s FiftyOne Global eCommerce Forum presentation can be accessed HERE.

And last, but definitely not least important, hats off to Mike DeSimone, Kris Green, Mike Griffin and the entire FiftyOne team who organized a world-class, high-value (pun intended) event for a jam-packed audience of many of America’s largest retail brands. 

Eric Best

Mercent CEO

Is Google Monetizing Google Product Search through Paid Search Ads?

“What’s going on with Google Product Search (GPS)?” is a question I’ve received a lot lately.  GPS was a smoking hot channel for most of the last 18 months.  But traffic and sales comps since about March 2011 have been down, in some cases substantially.  Well, several things are going on, but I think a major one is that Google is starting to more aggressively monetize GPS by shifting traffic away from Google Shopping results and toward its revenue generating programs - Adwords (paid search ads) and Product Listing Ads (PLA).  This is a hypothesis of mine, and I have no inside or other information from Google confirming or denying this.  Below I share why I think this is happening and some of the implications for retailers.

First, some very brief history on GPS performance:

• 2010 January-September:  GPS performed awesomely.  We were realizing YOY comparable store sales well over 100%.  In addition to great work by us and our clients, this was due to easy comps against the 2009 recession and some tactical missteps Google made on GPS in 2009.
• 2010 October-December:  Q4 2010 YOY comps got harder because (among our client base) the consumer spending recovery started in Q4 2009.  Also, Google changed some aspects of the user experience that negatively impacted GPS traffic.  In particular, in mid-October they made changes that emphasized local results and, we believe, larger stores.  We saw a dramatic downtick in traffic and sales, but Google acknowledged the mistake and corrected it before the brunt of the buying season.  Short story is that GPS still put up very impressive numbers in Q4, but not like earlier in 2010, meaning comparable store sales were in the 20-50% range.  (In hindsight, their experiments in October and November 2010 look like initial forays into monetizing GPS that had too much of a negative impact on GPS traffic.)
• 2011 January – June:  The comps started declining further.  Declines accelerated in April, May, and June.  By late spring we were seeing comparable same store sales for GPS in the single digits and lower.  Median account yoy sales growth for GPS only, went negative by late spring.  Essentially, Q1 2011 was still pretty good for GPS in terms of YOY growth, but Q2 was poor to very poor.

Several things are probably affecting GPS results, but I believe one of the biggest is that Google is monetizing GPS by shifting traffic away from GPS and toward its revenue producing channels.  The industry has speculated about whether and how Google would monetize GPS.  Some have speculated that Google would eventually make GPS a CPC program like other comparison shopping engines.  This is a legitimate option, but I think what we’re starting to see is that Google will stick to their tried and true revenue generator, paid search ads, as the vehicle to monetize traffic that comes to Google for shopping.  PLA, in this perspective, is a mere experimental riff on paid search ads.

Below is aggregate data from the set of Mercent clients consistently active on all Google programs since January 1st, 2011.  The subjects are all retailers – some large, some smaller.  It was not possible to make this a scientific test versus control study.  The data presents correlations, not causal evidence.  Nevertheless, it’s real historical data - let’s see what it tells us.
First, sales:  As mentioned above, GPS has seen tough times recently, especially since March (coincidentally around time that Panda started).  GPS comps were good early in the year but then, generally speaking, they declined.   The sales numbers below show that in absolute terms GPS sales have declined over the course of the year.  At the same time, however, paid search sales (which are labeled Adwords below) have increased.  The increase in paid search sales is more than the drop off in GPS, though the percentage change is roughly comparable.  What is also important, though, is that *total* sales have increased.

Daily Sales from Google Channels, 2011 YTD
$ per day

 
Now let’s consider what drives sales (since Google can’t itself directly affect retailer sales), traffic and conversion rate:  Traffic is something Google can directly affect and it shows a similar pattern to sales, with GPS traffic dropping off in March while paid search traffic increased at the same time and by roughly the same amount.  It’s worth noting that retailers are limited in their ability to affect traffic to GPS, especially in the short term.  Optimizing feed quality and content is, of course, critically important, but there is no lever like bidding that could be used to affect traffic.
 

Daily Traffic from Google Channels, 2011 YTD
Clicks per day 

 
 
As far as conversion rate is concerned, GPS stayed constant year to date, while paid search conversion rate increased substantially.  Google can affect conversion rate by preferentially ranking sites or content of high quality.  This has been a well publicized goal of its recent Panda changes, so the results here seem consistent with that objective.
 

Daily Conversion Rate from Google Channels, 2011 YTD
%, orders/clicks per day 

 
What does this all mean?  I believe Google is trying to increase revenues primarily through paid search ads and secondarily through PLA by changing the user experience so that some traffic to Google Shopping is effectively captured by those channels.  I think they have set a secondary goal of improving performance metrics of their paid search programs.   I also believe they’re constraining themselves by trying to achieve these goals by minimally impacting GPS traffic and sales.  I believe the sometimes wild fluctuations in GPS traffic over the last several months is Google trying to get the balance “right.”

This makes sense from a Google perspective:  the product Google sells is paid search ads and what they’re doing is trying to make that program look bigger and better to their paying customers.  They’re achieving this, in part, by leveraging the high quality, structured content from the “free” GPS program.

The data suggests they’re making it work:

• Total sales are up
• Paid search traffic and sales are up
• Paid search conversion rates are up
• And even though GPS sales have taken a hit, they’ve mitigated the impact to this channel by improving the quality of traffic and, hence, the conversion rate of GPS traffic

This is all fair enough – Google is allowed to make money.  But it creates several implications for retailers.  The first of which is that they should begin to assess Google holistically as a publisher rather than as a collection of individual channel silos.  Optimizing paid search, SEO, PLA, and GPS separately from each other only makes sense if that (i.e., separately) is also how Google runs them.  This does not appear to be a valid assumption.  Consider a metric as simple as Return on Google (ROG).  This is simply total sales from Google channels (in this case paid search, PLA and GPS) divided by total dollars spent on Google channels (in this case Adwords and PLA).  The ROG chart for the same client group is shown below.  (Note that ROG for GPS is undefined since spend = zero.)

Daily Return on Google (ROG), 2011 YTD
%, sales from all Google channels / spend on all Google channels 

 
This fascinates me.  Through all of this, Google has been able to marginally increase total retailer sales and make their paid search program look more efficient (at the expense of GPS) while keeping their total ROG essentially unchanged.  So, in net this looks good for retailers, but we shouldn’t presume this will always be the case. Hence, there are several key implications for retailers.  I’ll address these in future posts, but for now here they are briefly:

1. Retailers need to assess Google performance holistically, across all channels.  Retailers should use something like a ROG metric and evaluate all their Google programs; if Google pursues monetization of all programs through Adwords (and allows their algorithms to move traffic between programs) then looking at each Google channel individually may lead to business-shrinking results.
2. Retailers need to concentrate specifically and consistently on the quality of their product feed to Google.  Even if the numbers directly attributable to GPS go down (i.e., without using a ROG-like metric), the data above indicates that the data feed is significantly growing in importance to Google, especially as it relates to retail search.  In fact, I think the data feed may soon surpass other inputs in terms of importance to Google in determining relevance for retail related user searches.  There’s a great recent article on this topic (including pointing out that retail is leading the way on “paid search without keywords”) here: http://searchenginewatch.com/article/2083543/How-Inventory-Feeds-are-Changing-Paid-Search-Advertising. 
3. Retailers should hone their tracking so they can better understand which type of content on Google drove which clicks and which sales.  For example, was it the “Everything” search results page, a “Shopping” page search, an image, etc. from which the click originated.  Knowing which ad or ad group drove the results may not be adequate.

As stated in the beginning, this is only a hypothesis though one apparently supported by the data at hand.  I’m curious what others are seeing.

Frank Kochenash
Vice President Performance Services, Mercent

Reminder: Update Your Google Product Search Feed

Google has posted a reminder that the updates to the Google Product Search Feed is just around the corner. You need to update your product feeds with Google's new guidelines by September 22nd or your account could get suspended.   According to Google:

"As we announced in July, the new Google Product Search Feed Specification and Policies will go into effect on September 22, 2011. After this date, accounts that do not comply with the new requirements may be suspended."

For more details on these changes, I recommend you ready our post from July.

Mercent Performance Team