Holiday Season Approaching: Watch Out for Falling CPCs??

As the holidays approach there are many things we all look forward to –  holiday decorations, parties, and gifts (which hopefully means traffic to our retail websites) – but with it comes many things that we usually do not look forward to – long lines, traffic, air travel, and higher marketing CPC rates… or do we?

This year, in a departure from the norm, Shopping.com released their holiday rate card with lower rates for some traditional gift categories… lower rates?, that’s new! Don’t worry the sky is not falling and Shopping.com is not completely losing it, instead they are only lowering rates for a handful of categories (25 to be exact), keeping rates the same for over 160 categories, and raising rates (per usual) for the rest. Still this is not typical behavior for a Comparison Shopping Engine and thus begs the question – is something else at play? While I cannot speak for any engine, Shopping.com included, I do know that Shopping.com has a new CEO who is obviously looking to shake things up in the industry. He is a believer that lower CPC rates will help retailers increase their ROI on the site and, I presume, in turn may convince retailers to sell other products through Shopping.com… the breadcrumb trail always comes back. But is that it?

Sure, this adaptation could also signal that Shopping.com expects the current economy to impact their traditionally profitable Q4 and they are trying to add and keep retailers by using incentives. Or they could be reacting to a decline of retailers that sell in these 25 categories, either now or during past Q4s. Or some completely different reason beyond the understanding of anyone not within Shopping.com. Still, whatever the reason, Comparison Shopping Engines are an important holiday marketing tool and if the site serves a demographic you are interested in reaching and they are offering a discount to your rates, I would suggest you consider it strongly.

Shopping.com has played their [rate] card – will others follow suit?

Comments

[Tien]

It'll be really interesting to see how other CSE's react to this..

[twift1]

Even after it being a sale stunt, many of the online consumers still will get some thing interesting with this.

[charles]

smart move by shopping.com. They lower the rates in categories they need more stores in.

[Brian S]

CSEs seem way more flexible this year. We are having great success negotiating rates outside of rate card pricing for some of our merchants. This has been a big win for us. Press the CSEs. In certain categories (usually soft goods), they need you more than you need them.

[Gdogkim]

This is good strategy rooted in probability theory.

If you can raise variety on the site, ctr% will increase, however merchant ROI will decrease.

But, total probability of conversion increases at a multiplicative factor (as long as quality merchants are added), while average merchant cpcs decline linearly. A net revenue gain!

[Vick, Vancouver]

quote"It'll be really interesting to see how other CSE's react to this.."
Indeed it will be

[Vick, Vancouver]

quote"It'll be really interesting to see how other CSE's react to this.."
Indeed it will be

[e-retail]

where can i get the latest CPC rate details and its comparison for shopping comparison site ?