How is Amazon Responding to Google’s SERP Changes?
Since the moment Google announced that right rail text ads would be removed from the search engine results page, we’ve been looking very closely at data. More specifically we’ve been asking, what clients are feeling the impact? How high will the CPCs go? Will we need to increase bids to maintain click volumes? We determined pretty quickly that results truly vary even within vertical categories – and in many cases, there has been little to no impact yet at all.
We have identified other categories, however, that have been impacted by an external factor of a different kind: Amazon. It’s clear that Amazon, fairly quickly, altered its paid search approach. The change hasn’t happened across the board, but rather strategically in certain verticals. For example, for PM Digital’s wholesale clients going direct to consumer in the apparel and footwear categories, we have seen no impact or change in impact from Amazon. Impression share when brands are competing with Amazon there has remained flat.
But for other categories – everything from home and outdoor, to general merchandise, brands are feeling the crunch from Amazon’s bid increases specifically. As Amazon’s impression share creeps up (as identified in Google’s auction insights reporting), so do our brands’ CPCs.
This can have a substantial impact on CPCs for clients. If any company gets more aggressive with their bids in the auction, our clients often maintain their own top 4 positioning, but CPCs often climb immediately. What’s a client/agency to do? The most immediate and impactful counter-strategy we’ve found is to test lowering bids. You are looking for the bidding sweet spot to maintain your desired position and impression share, while paying less per click. We have had consistent success in lowering CPCs when testing this strategy.
As Amazon continues to alter its strategy, we expect to be able to see if other brands or big box retailers will have a similar impact. When Amazon makes an impression share push, we don’t always see it last or maintain at those high levels long term. More to come…