Jack Kiefer, the founder, President, and CEO of BabyAge.com, has some interesting insights on the current trends in digital marketing after being in the game for many years. He shares his thoughts on the evolution of customer acquisition over the past decade, from AOL to shopping comparison to Google, and where it is heading now. BabyAge.com has also been able cut back on their search spend without seeing a drop in revenue by being more targeted with their approach.

For more digital marketing insights from various industry leaders, check out the Digital 180 channel and check back with the Compete blog for updates.

When an extra minute or two checking around for a coupon code could save you money on an online purchase, it certainly seems worth the time. I can’t remember the last time I bought something online without checking for a coupon code first, and I’m just one of 32 million consumers in the U.S. that visited a coupon site last month (up from 28 million a year ago).

Compete’s recently released list of the top 10 Coupon and Deal sites shows a changing landscape over the past year as economic woes have weighed on consumers’ willingness to make purchases.

Among the top sites, Coupons.com is still the clear-cut leader, however the gap has closed since last year and the big mover on the list is RetailMeNot.com. RetailMeNot’s collaborative approach to coupon and deal hunting has helped it stand out in a crowded field of coupon sites and made it top-of-mind for shoppers. Consumers not only find deals on the site, but rate each deal code and share what they find, driving the best deals to the head of the list. Over 50,000 consumers share coupon codes on the site each month. In addition, the site jumped from sixth to third in our rankings over the past year, with nearly 200% growth in visitors. RetailMeNot captured 18% of all searches for the term ‘coupon code’ over the past three months, 4X higher than its closest competitor (couponcabin.com).

For several months, retailers have been reporting declining in-store sales but increasing online sales. So what does the all important e-commerce space look like for two of the largest retailers?

Last month, Wal-Mart attracted more visitors than Target to its website and 47% of Wal-Mart visitors looked at a product compared to 31% of Target visitors. However, among shoppers who viewed a product, Target had a higher shopping cart interaction rate and conversion rate.

Despite the slight lead in conversions, more Target customers abandon their carts than Wal-Mart shoppers. 47% of shoppers who begin checking out at Target do not complete their purchases, where as 35% of shoppers at Wal-Mart abandon their carts.
In general, Target leads in purchase rate and Wal-Mart boasts a smaller shopping cart abandonment rate. But how do more loyal consumers shop online?

Retailer credit card holders represent some of the most loyal, and valuable, customers. Among shoppers who accessed their credit card accounts, conversion rate for Wal-Mart shoppers edges ahead of Target to a 14% rate compared to Target’s 13%. Wal-Mart shopping cart abandonment does not change much, averaging 33% of shoppers. Target’s abandonment rate, however, drops 18% from 47% to 38%, narrowing the gap between it and Wal-Mart’s rate. It’s no surprise that competition is extremely fierce between these two rivals and I expect things to heat up even more as retailers gear up for back-to-school and the holiday season.

Amazon’s sheer size (65 million unique visitors in April) gives it a powerful soapbox from which it can pitch virtually anything to its captive audience. Many of the tens of millions of U.S. consumers that visit its homepage each month have undoubtedly noticed the site’s ongoing, fervent promotion of its popular Kindle ebook reader. Since the original Kindle launched in late 2007, Amazon has marketed Kindle almost without interruption on its homepage.

Amazon continues to update and test new advertising messages for Kindle, and on any given day cycles a couple different ads on the site. In May, these Kindle ads generated over 60 million ad impressions and since the start of the year, the ads have seen steadily increasing clickthrough rates, with expected spikes corresponding with new product introductions. The highest clickthrough rates were reached the week ending February 14th following the introduction of the 2nd generation reader. In total, 3.4% of homepage visits that week resulted in shoppers clicking to see the new Kindle.

These efforts, coupled with largely positive reviews, have helped drive high consumer demand for Kindle. Kindle interest has grown steadily over the past 18 months, with recent jumps attributable to the 2nd generation launch in February and the announcement of the larger-format DX reader last month. Over a million consumers shopped for the updated Kindle during its first week on the market. Luckily for both consumers and Amazon, the company seems to have worked through production bottlenecks and accompanying stock-outs that plagued the original device’s launch.

The fact that the Kindle homepage ads have remained so prominent for so long is a clear sign that Amazon believes they are working in driving consumer interest. Given the value of the real estate the ads occupy (500 x 300 pixels), something else would have long ago replaced them had they not generated sufficient results for the company. From a broader perspective; however, how well are the ads performing relative to other referral sources such as search and email in driving interested consumers to consider a Kindle purchase?

In May, the homepage ads drove nearly 45% of all visits to the Kindle product pages, while another 26% of traffic was referred from other places within Amazon (banner text links, on-site search, category navigation, etc.). Search engines (such as Google) and Amazon’s email campaigns drove 6% and 5% of traffic, respectively.

From a post-click engagement perspective, search engines drove the highest level of Kindle engagement and purchase intent. Searchers averaged over 5 minutes on the page learning about Kindle, versus just 3 ½ minutes for consumers referred through the homepage links. Search also performed best at driving consumers to purchase. This is understandable given that searchers are by definition looking for the product to begin with rather than reacting to a marketing message placed in front of them. 4.3% of consumers referred via search engines added the Kindle to their shopping carts, slightly higher than homepage and other Amazon referred traffic sources. Email, on the other hand, fared poorly with consumers spending considerably less time viewing the product and relatively far fewer demonstrating immediate purchase intent

With Kindle, Amazon seems to have a created a product that corrects for many of the problems that slowed consumer adoption of earlier attempts at ebook readers. If consumers continue to clamor for these devices, I wouldn’t expect Amazon’s Kindle ads to disappear from the homepage anytime soon.

To read up on the latest trends in online retailing, visit us blog.compete.com/retail.

A few weeks ago we wrote a blog about a case study on the effectiveness of two ads Kohl’s ran on the homepage of MSN and the homepage of AOL. Recall that the difference between the two ads Kohl’s ran was that the one on AOL was not the standard 300×250 but a larger IAB ad unit size of 300×600. The larger ad did in fact drive nearly 30% more visits to Kohls.com on the same day than the 300×250 on MSN. But how does the Kohl’s ad on AOL compare to other retail campaigns?

In the month of May, Walmart ran a few full day homepage ads on AOL.com. We compared the results for Walmart’s campaigns on AOL with Kohl’s. AOL homepage visitors were over 2x more likely to also visit Walmart.com on the days Walmart ran their ads compared to visitors to Kohls.com on the day that Kohl’s ran its large ad on AOL. The visitation overlap is higher for Walmart because it is a much bigger company getting nearly 6x more monthly visitors to its site compared to Kohl’s (29MM vs. 5MM in April). However, compared to the average visitation to these retail sites by AOL homepage visitors on non-campaign days, Kohl’s saw a greater increase in traffic to its site on the day it ran the homepage ad compared to the increase in traffic Walmart saw on its campaign days.

Site visitation and shopping cart activity on Kohls.com increased by 100% as a result of the homepage ad on AOL. In comparison, Walmart saw a lift of 25% for visitors to Walmart.com but shopping cart activity saw less impact when it ran homepage ads on AOL. The better results Kohl’s saw is probably due to a combination of both the larger ad size as well as its compelling offer for free shipping and measurable cost savings compared to Walmart’s call to action for ‘click to see more patio collection.’ The lesson learned is that in this economy, retailers who address cost savings will see the gain.

To learn more about Compete ad effectiveness solutions and to download the original ad effectiveness study for Kohl’s, visit compete.com/adimpact.

“My goal in life is to be as good of a person my dog already thinks I am.” ~Author Unknown

I’ll never forget the day I fell in love. I was driving north on the 5 in San Diego from the airport home to Del Mar. Cargo was flown in from Oklahoma City to San Diego and this cargo changed my life. I had been against getting a dog for years, but after a while my emphatic “no” turned into a hollow “yes.” That hollowness was quickly filled by a 5 pound brindled French bulldog puppy. There is nothing cuter than a puppy.

Spring time not only means Mother’s Day and graduations, for dog owners it also means check-ups, fleas, ticks, and the struggle known as “bath time.”
As virtually everything has become more web-friendly, I was curious just how much consumers relied on the web to get the essentials needed for their pets. Are these sites becoming more popular? And what are people searching for on these sites?

Petco isn’t just where the pets go, it’s also where we seem to go. Petco has seen a tremendous increase in traffic year over year (44%), while both 1800Petmeds (-7%) and Petsmart (-15%) have experienced a decline.

So where are these people coming from, and what are they looking for? Share of pet-related searches has increased significantly from 2008, and all three stores have benefited from an increase in search related traffic to their site.

Once on these sites, it is interesting how the consumer seems to use each of these sites in a distinctly different way. Below is a list of the top search terms for April on each site:

A couple of things immediately become apparent:

• Frontline is one of the top 3 items searched for all on all 3 sites. (Flea medication)
• While Advantage (Pepsi, to Frontline’s Coke) appears as the 5th most popular search term on 1800Petmeds, it doesn’t crack the Top 20 search terms on either Petco or Petsmart
• Branded terms dominate when on 1800Petmeds
• Generic keyword searches dominate when on Petsmart - with only a handful of branded terms surfacing to the top of their list

It is no surprise that 1800Petmeds shoppers are looking for specific medications and prescription diets on their site, but what is surprising is the difference in interests between Petco and Petsmart. The Petco shopper seems to already know what they are looking for when arriving at the site, whereas the Petsmart shopper seems to be a bit more casual with their needs, searching for more generic terms such as “turtle” and “rabbit.”

There is no doubt consumers are turning to the web more and more not just for their own needs, but also for their pets. Petco clearly has the edge at this point but with 1800Petmeds and Petsmart, there are clearly options for the consumer. The question is: as more consumers are turning to the web for their pets, which retailer will be able to capture the most of these “net new” shoppers?

Spring: A time for celebrations, baseball, and flea medication.