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Explore the effects of ad creative on search engine advertising performance. Analyze Unique Selling Propositions, competition, and interactions between USPs and rank in sponsored search auctions. Discuss the impact of bid updates on ad rank variations and consumer behavior.
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NET Institute An Empirical Analysis of Search Engine Advertising.. Anindya Ghose and Sha Yang, NYU. Discussant: Siva Viswanathan Robert H. Smith School of Business, University of Maryland, College Park April 18, 2008
Bidding “Creatively” in Sponsored Search Auctions Tell US Something We Don’t Know • How does the seller’s ad creative affect ad performance? • Unique Selling Proposition (USP) in the ad creative • specifically, Price vs. Quality USP, • Interactions between USPs and Rank. • Controlling for Competition Animesh Animesh, Siva Viswanathan, and Ritu Agarwal, University of Maryland
Data The Focal Firm… • Bids on a portfolio of keywords • The bids are updated frequently and lead to different ranks at which an ad is shown. • Vary the ad-creative (USP) for a given keyword. Data • Top 36 keywords – based on CTRs (e.g., loans, mortgages, home loans, etc.) • Daily data on Ad’s Rank, (Price and Quality) USP employed and corresponding CTR (~3 months in 2006)
High Low Top Bottom Rank Our Findings
The Sponsored Search Filter! Sequential Search from Top to Bottom
Simultaneous Model of Click-through, Conversion, & Bid-Price • Search Engine’s Decision? • Retailer vs. Brand Keywords; Keyword Length. • Different segments of consumers? • Different stages in the purchase process? • CTR and Conversion Rates • Higher CTR, higher conversion rate? Rank, negative conversion rate? • Emphasize Cross-Selling Results. • Differences across consumers? • Implications for Advertisers?