Is Target Trying to Buy Their Way to The Top of The Diapers Mountain?

Baby In Diaper

Image from: Baby In Diaper / Shutterstock

It has been a while since we here at Compete have taken a look at what is going on with the diaper market online.  In Oct, 2010 we published an analysis  that showed how Diapers.com was a growing threat to Amazon.com in the diaper category.  In the time since that original post, Diapers.com was, of course, bought by Amazon.

Buying diapers online has also become more commonplace as consumers look to online for better prices and more convenience. As this has happened, diapers have also become an extremely competitive category on search engines.

Compete data has been extended recently such that we can get a very detailed as to what is happening on search engine results pages (SERPs).  From our opt-in panel, we can now see millions of queries as well as the resulting search engine results pages across the major search engines.

Using this new data capability, we can look at what search terms lead to what domains, and what happens after the consumer reaches that domain. For this study, we utilized generic search terms for diapers, including phrases such as “baby diapers.”

Overall, Target, Amazon (directly and via Diapers.com), eBay and Walmart dominate the overall listings – but there is a clear hierarchy.

 

Non-brand diaper search - Overall Search Results

What this chart says is that on generic, non-branded searches for diapers, Target, Amazon and Diapers.com showed around 30% of the time.  In contrast, eBay and Walmart showed up only about 20% of time – a huge 10% difference.

Digging a bit deeper, let’s take a look at how some of these companies are positioned in terms of overall organic search on these terms:

Non-brand Diaper Search - organic search results

 

In this chart, we are looking at percentage of organic search listing for each domain – and we can see that Amazon and Diapers.com dominate with an organic listing showing up approximately 20-23% of the time.  Contrast this with Walmart and Target – who both see significantly lower organic listings – with Target only showing up around 10% of the time.

So while the first chart indicated that Target was competitive on the keywords with 33.14% of all search engine results pages having a Target listing, we see now that they aren’t getting that traffic from organic search results.

Looking at the paid results – we can see how Target is driving traffic.

 

Non-brand Diaper Search - Paid Search Results

Target is clearly buying these search terms aggressively to make up for the lack of organic search engine results placement.  Also interesting is that Walmart does not seem to be interested in competing with Amazon or Target on the category, or at least not willing to spend as much on getting that consumer.

Finally, let’s compare the paid search placement strategy of Diapers.com and Target.com.  With Compete’s SERP data set, we can also see where people are buying their ads and in what positions.

Specifically, we look at the three major areas for paid placement  – top of the page (on top of the organic listings), right side of the page (right-hand column next to the organic listings) and finally the bottom of the page (below the organic listings).  In each area, we also rank where they are buying.  A rank of 1 means they have bought the top spot in a specific paid placement area (again, such as top, right or bottom), while a rank of 3 means they have bought the third spot.

Using this data, we can assess the buyer’s paid search strategy.  Are they buying the top position at on top of the organic results, or are they buying lower price ads on the right?

For Diapers.com we see that they aggressively buy the top 2 spots at the top of every SERP page for these generic keywords, and they buy the top right spot – but not the spots below that.  They are spending up for this traffic.

Diapers.com - Paid Search Strategy

 

What about Target?

Target.com - Paid Search Strategy

 

Target is buying the SERP bottom spot, and is aggressive in buying the top 5 spots to the right of the organic search results pages.  Since these spots are likely less expensive than the top spots being bought by Diapers.com, we can conclude that Target is counting on driving traffic at a lower cost than Diaper.com.

Of course, the key is which strategy generates the best results – but a Compete study recently published showcased the added value of top paid placement.  Target may wish to consider a different strategy if they want to continue to compete against Amazon/Diapers.com in this competitive category.

For more information about our SERP data, check out “Seeing Between the Lines…of the Search and the Click”.  What do you think?  Are the top spots worth paying for?  Leave us your thoughts in the comments!

About Damian Roskill:
Damian Roskill is the Managing Director of Marketing at Compete. Before Compete Damian was head of products for a video start-up and has worked in start-ups for most of his career. Damian's career aspiration is to be at one with the advertising universe. Damian can be found on Twitter as Droskill, or connect with him on LinkedIn at http://www.linkedin.com/in/droskill