How effective are remarketing audiences at providing incremental revenue to traditional search and shopping campaigns?
Remarketing lists for search ads, better known by its acronym RLSA, is a feature that’s been around in the Google universe for the last couple of years. However, it has recently been made eligible for use with Shopping campaigns, one of Google’s fast-growing segments. With CPCs climbing in search and reaching new heights in shopping, advertisers now have to peel back the onion to help discover ways to generate highly-motivated traffic.
Implementing RLSA is very much like remarketing on the display network, where you assign certain audiences to specific campaigns, except in this case you assign them to search campaigns. The single greatest difference between remarketing on the search network via RLSA and the display network is that the user’s intent is manifested via search query, thus making it far easier for the advertiser to understand what the user is looking for.
This is in opposition to display remarketing, where advertisers need to try and determine what makes their audience tick then hope that well-crafted creatives and superior placements grants them clicks and conversions. The best way to describe this difference is to understand that display remarketing is passive, whereas search remarketing is active.
We looked to a national beauty and lifestyle company to better understand how RLSA might impact a medium to large retailer in the ecommerce space. The data collected was from a 4 week period. ROI, or return on investment, is instead conveyed as ROAS, or return on ad spend. Here’s what we found:
Total account traffic, segmented by non-RLSA and RLSA clicks by campaign type.
CPC averages, segmented by non-RLSA and RLSA by campaign type. RLSA CPCs will oftentimes be higher due to any bid adjustments that might be in place
Total earned revenue, segmented by non-RLSA and RLSA by campaign type. RLSA revenue, while substantially lower overall, was generated from a significantly lower amount of clicks.
Total return on ad spend, segmented by non-RLSA and RLSA by campaign type. Despite lower earned revenue and higher CPCs, RLSA audiences produced a far higher return for the client.
Clicks derived from RLSA audiences were just a fraction of those generated from the standard keyword targeting (~4,000 vs. ~36,000). This proportion is by no means constant, as criteria such as the amount of search keywords, products available in your Shopping campaigns and the size of your remarketing list are going to greatly influence how this proportion turns out.
We notice that the CPCs of RLSA audiences greatly exceeds that of non-RLSAs. This is due to the advertiser’s ability to set a bid modifier for the audience/ad group combos being used. Audience bids will be the same as the default ad group bids during initial setup, however advertisers can bid on the audiences individually as they see fit. Here, we see that audiences assigned to non-brand campaigns experience a sizable bid modification, with CPCs nearly doubled.
Traffic and costs aside, the revenue and return is where the rubber ultimately meets the road. Despite accumulating just under 10% of total clicks, RLSA audiences generated over 25% of total revenue. The result is that RLSA targeting generated a return over double that of traditional campaign targeting.
The audiences that we used during this test were a combination of past buyer and all site visitor audiences. To that end, it’s highly recommended that advertisers perform audience testing when utilizing RLSA, much like in remarketing campaigns. Do 7-day Buyer audiences produce a higher return than 14-day Buyers? What about 30-day Buyers?
The benefits of utilizing RLSAs to augment existing search and shopping campaigns couldn’t have been made clearer than during this test. With such a high rate of return on a rather incremental increase in total traffic, RLSAs can have a profound effect on the performance of an e-commerce account.
If you would like to speak with one of our esteemed PPC experts to see how RLSAs might enhance your account or if you would like assistance with implementation, please drop us a line at email@example.com or give us a shout at (866) 819-4650.