Using search data to drive annual budget planning
For some people, autumn conjures up thoughts of pumpkins, fall foliage and tweed suits. For marketers, it signals a 2-3 month stretch of excel spreadsheets, vendor reviews and endless negotiation. Yes, we are in the thick of planning season, and this year an uncertain economy will leave its mark on all line-items, search included. And even though search spending is likely to remain flat, the clever search marketer will present a refined strategy based on changing consumer tastes, as evidenced by recent search data and offline indicators.
What we want and why we want it is almost always a product of the economic, political or social climate. In 2001, USA Today commented on the increase in searches for gas masks and American flags, a behavior repeated in 2003, and duly noted by the New York Times. By 2004, America had moved on to all things gold, pink and luxury. Fast forward to 2008, and the search marketer will observe drastic changes in consumer preferences as compared to 2007 and years prior.
One of the more remarkable changes in 2008 is where we want to shop. According to Google trends, the “99 cent store” is in, and the “department store” is out. Drugstores such as Walgreens and CVS continue to trend upward, while the jury is still out on whether JC Penney and Kohl's will have a good fourth quarter.
And while coupon searches peak annually in Q4, the activity has been on an upward trend for the past four years, in tandem with an AP report that coupon clipping is on the rise. Online retailers can make the most of bargain hunting by developing a suite of landing pages to accompany any offline discounts, or perhaps create unique online coupon offers.
For obvious reasons, many consumers are no longer spending on luxury goods. In 2008, searches for “luxury” followed annual patterns, but appear to have taken a harder hit in recent months. Furthermore, Google Checkout Trends suggests that luxury items account for significantly less revenue in 2008 than in 2007. Yet for others, there has been a change in consumer perception between “must-haves” and “luxury.” According to NPD chief industry analyst Marshal Cohen, back to school shopping data suggest that electronics have become a required item, while last year's school bag will be reused until worn out. Dissecting this finer point of wants-vs.-needs will be critical to all retail segments over the next twelve months.
Assuming that the smart marketer has been analyzing such data for years, 2008-2009 is the time to put it to the test. Search engine marketing is beautiful in is flexibility; budget allocation, keyword selection and copy should be aggressively tested during this period. Search engine optimization and social media investments should also increase, as the return can be exponential. As Robb Hecht noted last week, gaining market share can actually be less expensive during a downturn.
And if, by chance, you do have the ear of the CMO, consider relaying insight on broader marketing strategies. Loyalty programs, for example, are experiencing an increase in queries in 2008, as are searches for “free shipping.”