Dollar Days Benefits from Automated Paid Search Campaigns: A Case Study

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Through my experience in the search industry as a founding executive with Yahoo, running search engine marketing agency Efficient Frontier and in my talks with customers and prospects, I have noticed that there are several key factors that often preclude small and medium-sized businesses from integrating SEM into their marketing mix:

  • high keyword bid costs and unknown performance;
  • lack of time to manage numerous keyword campaigns;
  • lack of clear understanding of how SEM works; and
  • no true way to predict or measure ROI.

These factors combine to create a dissonance in the marketplace that paid search is only for the big players and can't be leveraged to drive online (and offline) sales for much smaller companies.

The reality is that the right technology can make SEM available to the masses to reach the right customers at the right time with the right product or service. Here is one example where a mid-tier company is getting the most out of SEM, and more importantly, increasing its sales.

SEM Dollars Make Cents

Dollar Days International, a Phoenix-based online wholesaler for small business owners to order goods ranging from decorative items and clothing, to personal care products and greeting cards, came to my firm earlier this year.

Dollar Days was looking for an SEM solution that would allow better management of its paid search campaigns in an automated fashion, while being able to connect ROI to specific performance metrics. Previously, the company had been managing its paid search campaigns as part of its internal search engine optimization function, but needed a solution to help it manage its growing portfolio of keywords.

Our agency worked with Dollar Days on a new automated Web-based solution called Efficient Frontier Express to help the company manage its thousands of keywords without spending an exorbitant amount on a technology system that they couldn't fully leverage.

Using our data-driven portfolio technology based on Wall Street analytics, our application uses statistical decision-making algorithms and "what-if" scenarios to determine the most effective keyword bids relative to the Dollar Days' specified paid search budget and key business metrics.

The automated solution allowed Dollar Days to define its key marketing metrics (clicks, units sold, registrations and revenue) and daily budget spend criteria and then run forecasts /models to select the optimal keyword bids based on the predetermined campaign goals and budget spend.

After the metrics were defined, Dollar Days utilized a user-friendly interface to set up its campaign and then launch it. After the campaign launched, Dollar Days used the application to track and measure its keyword portfolio through the real-time user interface, which provides month-to-date performance results and performance metric reports, including leads, CPA, portfolio and keywords performance.

Dollar Days also has the flexibility to change key elements of its campaigns as required on a moment's notice. But once the campaign was set up with its parameters, the system managed all the decision-making needs for Dollar Days so management could focus on its business.

Marc Joseph, CEO of Dollar Days, said he attributes the use of our automated SEM technology to increasing his company's return on each dollar spent on customer acquisition by 25 percent in just the first month. Mr. Joseph also noted the improved ability to manage keyword effectiveness and hone in on which keywords are working and which ones are not in attracting the right customers that will become repeat buyers.

The company has 600,000 customers and is acquiring new ones at the rate of 1,200 per day, which Mr. Joseph largely associated with Dollar Days' new SEM strategy. He said "a successful SEM strategy needs to include the human factor to determine the right keywords, but automated technology is the key to predicting the exact performance of the entire keyword portfolio against our business metrics."

Conclusion

While Dollar Days is just one example of a small to midsized business that is successfully using SEM to attract new customers and increase sales, it supports my contention that SEM can, in fact, be leveraged by the vast majority of businesses large or small.

The key is that companies of all sizes must determine how they want to measure the effectiveness and performance of their paid search investment, and then select the right technology partner or solution to help them to manage their campaigns and accurately track and adjust the performance in real time. To me, the right technology is the catalyst that will help SMBs to climb aboard the SEM train en masse.

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