Tune Your Paid Search Campaigns To Account For Holiday Volatility


The relationship between bids and conversions is like that between ice cream sundaes and maraschino cherries.  It’s theoretically possible to have one without the other, but the natural order involves the two of them being intricately linked.

The better your conversion rate, the more aggressive you can get with your bids.  The more value you receive from each of your conversions, the more leeway you have to go out and get more of those conversions.

You know this, and I’m sure you have strategies in place in your account to maximize both your conversions and your return on investment.

Throughout the year, it’s possible to get into a rhythm with your conversion rates and average order values. There are probably broad seasonal trends, but steering your bids according to conversion rates doesn’t require a ton of daily focus as part of your account management.

The Holidays Change Everything

We’ve recently done a wide-ranging study with Google Analytics data, however, and found conversions rates to be very volatile over the holidays.

It’s likely no surprise that people convert at a higher rate during the holidays, but even within that time frame there can be vastly different expected conversion rates and average order values from one day to the next.

How to cope with this volatility? To help, I want to walk through what we’ve found across the board; then, I want to explain how you can replicate these findings in your account to safely boost your bids during the holidays and win more share of wallet.

Our Findings

First off, let’s take a look at some of the most volatile days for transaction rates (based on e-commerce transactions per session). For the analysis below, we looked at the percentage lift in transaction rate when compared to the average rates for billions of sessions across millions of accounts in the U.S. (only those accounts that had data sharing enabled).

It’s well known that the holiday season generates huge spikes in traffic and visits on retailer sites. What’s eye-opening is how much more likely customers are to convert and purchase. Check out these stats from the GA analysis:

High conversion rate days over the holidays

(For your reference, each of these days will come one day earlier in 2014. So Cyber Monday is on 12/1/14, Black Friday is on 11/28/14 and so on.)

Not only is there going to be a lot of traffic, it’s going to be good traffic. Traffic that wants to spend money with you. For these five days (and others like them during the season), it’s like the holidays are pressing everything further down your funnel.

If you can expect an 80% lift in conversion rate, you should plan on being 80% more aggressive with your bids to accommodate that change. Those are important days — take full advantage of them.

Every day out of the first twenty in December sees a lift in expected performance — transaction volume is higher than usual from the middle of November all the way up until December 20th.

Transaction volume lift over average during the holidays

Some other considerations based on what we’ve seen in our data:

  • Mondays and Tuesdays generate the highest number of transactions.
  • High transaction days aren’t correlated with high session days, though. When you’re determining your bids, look for conversions, not visits.

Finding These Numbers For Your Own AdWords Account

Here are a couple of reports that you can run to see what happened last year and what you can expect this year in your own account.

The simplest route is just adding conversion rate to your graphs in AdWords:

Daily conversion rates for an account

This account saw higher conversion rates on Black Friday and the Sunday before Cyber Monday. Then, it experienced a steady rise the week before the 20th. This account had some overlap with overall trends, but it might index a bit more toward last-minute shoppers than other retailers (“last-minute” by free shipping standards at least).

But for retailers, conversion rate isn’t everything. Here’s a look at that same time range with the total conversion value by day layered in:

Daily conversion rate and conversion value over the holidays

Those great conversion rates at the end of the season aren’t as impactful since they’re also some of the lowest value days of all.

After all of this analysis, before you put a plan into action, remember to shift your days one day into the past. Cyber Monday was on 12/2 last year, and it’s on 12/1 this year. So for any spikes just subtract one day when adding it to your 2014 plan.

Turning Insights Into Action (and Action into Profit)

Using Google’s numbers or the numbers that you generated yourself, you should know what your key days are throughout the holiday season. Once you know those key days, be sure that you do everything possible to own them.

Find high transaction rate and average order value days and drive traffic to your site with increased bids to capture those hyper-valuable searchers.

If there’s a day where you saw transaction rate spike 65% last year, adjust your bids up 65% to match. To maximize efficiency during the holidays, build your plan ahead of time and then schedule changes using automated rules. Managing this is about being able to project your conversion and average order rate so that your bids are in lockstep with them.

Notice I said “days” and not “weeks” above. This stuff is too important to evaluate once a week or so — make it a daily habit during peak seasons. Weekly averages are going to dull your real spikes in transaction rate. These are the types of days that can make or break a holiday season.

If you’re successful, you’ll be able to outbid the competition on key days while still driving returns in-line with your profit goals. The marketer’s version of a sundae with a cherry on top.

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