|Data Feeds Tested|
|Tuesday, 22 June 2004|
Topic: Data Feeds — How to Create and Effectively Use Data Feeds for Profitable Campaigns
What is a data feed? How can using them get you exposure on over 15 sources of highly qualified traffic, sources that will often convert at a higher rate than either Google or Overture?
The sources in question are comparison search engines. While we have tested a number of these in previous reports, we have yet to look at how to create and utilize feeds to optimize your comparison search engine campaigns. This research brief will do just that. (Our previous reports on comparison search engines can be found in the notes at the end of this brief.)
What are the typical requirements of a data feed? How do you update and maintain a data feed once it is created? And how can you optimize and effectively use data feeds to drive the most qualified traffic?
1. THE MARKETING POTENTIAL OF A DATA FEED
A data feed is simply a structured form of information about the products you carry. Data feeds are most commonly based on MS Excel, MS Access, or a text file with every value separated by a delimiter (commas, pipes, or tabs). A data feed forms the backbone from which comparison engines derive and display information about your products.
Comparison engines are a good source of qualified traffic because shoppers can compare products based on detailed descriptions, prices, and consumer reviews before clicking on your listing. These engines typically convert at a higher rate than standard PPC engines such as Google AdWords or Overture.
Data feeds are helpful in (at least) three ways:
KEY POINT: The key to a successful comparison engine campaign lies in using a well-structured and optimized data feed.
To understand the marketing potential of an optimized data feed, we will look at how our test site used a data feed to launch a profitable campaign on one of the major comparison engines.
On their first run, this company did what most merchants do: they included their entire product range in the data feed. The results for Campaign A are listed below:
What You Need To UNDERSTAND: The cost-per-click for this campaign was $0.50 and the order size for each product was $150. The total amount spent for this campaign was $1,138, net profit after click costs was $437, and the ROI achieved was 38.40%.
On analyzing the results of Campaign A, this company realized that while products 3, 8, and 9 received a large number of clicks, very few of these converted into orders. As a result, products 3, 8 and 9 exhibited negative ROI. Having caught this trend early in Campaign A, we decided to remove these products from the data feed.
What would happen to this campaign if we removed the unprofitable products and achieved the same results? Take a look at Campaign B, below:
What You Need To UNDERSTAND: By optimizing the products in the data feed, our test site would be able to boost ROI to a substantial 286.58%. Removing the low-converting SKUs resulted in an increase in net profit of $631 and a decrease in click costs of $765.50. Not only did the profits multiply, but the total campaign expense was just one-third of what it was in Campaign A.
We have made a "working" version of the spreadsheet we used to generate these tables available for download:
You can use this worksheet to analyze the profitability of your own comparison search engine campaigns. Change the number of clicks and orders for each product and make global changes to the CPC, order size, and profit by changing the numbers in the green row.
KEY POINT: If you are currently using comparison engines (especially Yahoo! Shopping), you need to take a hard look at the clicks and orders for each individual product.
Many campaigns that convert at 1-2% can be increased to 5%+ by just optimizing the data feed and listing products that are converting at a level that is profitable for the company. In fact, this principle applies to any advertising or marketing service that is based on click fees.
Now that we have shown you what a data feed can do for your marketing campaign, let's get down to the nitty-gritty of how to create, maintain, and optimize a data feed.
2. HOW DATA FEEDS WORK
What are the typical requirements of a data feed?
The comparison engines usually make the requirements quite simple. Once you sign up, they will provide a "sample" feed or the requirements for the feed that you need to generate. In general, the following information is required in most of the major comparison site data feeds:
Not every comparison engine requires the exact same information, and they often have different "naming schemes" for the data. Check directly with each comparison engine to find out what it requires.
How do you create a data feed with these requirements?
For large retailers with in-house developers, it is usually simple to satisfy these requirements by having your developer pull the required information from your current database of products.
For smaller retailers that have no development or database experience, satisfying these requirements will be more difficult. However, one or more of the following suggestions may be helpful:
KEY POINT: Before you use your data feed to load products on any of the major comparison engines, determine if that site carries your products by using a search engine.
Once you decide on a comparison site, contact them and ask to become a merchant. You should see your products listed on the comparison engine once you complete your setup and the engine has integrated your data feed.
How do you update and maintain data feeds?
There are three primary ways to get your products loaded and updated on comparison engines:
KEY POINT: Updating the data feed is an important step that determines if your listings remain fresh, accurate, competitive, and keep drawing in traffic. You should choose the method that best matches the frequency with which you need to update your product listings.
3. HOW TO OPTIMIZE YOUR DATA FEED
This is a crucial question that ultimately determines the success of a campaign. A common tendency of many merchants is to build a data feed and load their whole catalog of products on to the comparison site. After the first month these merchants look at the number of clicks and orders and figure out the ROI of the campaign. If the campaign proves profitable, they keep it up; if not, they take it down.
Take the example of Yahoo! Products Submit. Many merchants listed their products for a couple of weeks to a month and immediately took them down because Yahoo! Shopping was no longer profitable.
One of the main benefits of using data feeds is that "you have control." You can add or remove products from your data feeds at any time, which makes it an effective way to manage campaigns.
Most comparison engines will provide the number of clicks you received for each individual product. If you compare those statistics to the number of orders you have received for that particular product, you will be able to determine if selling the product was profitable. The non-converting products can then be taken off your data feed to improve campaign profitability. We have illustrated this above with our test site.
More recently, some comparison engines actually provide tracking codes that give you the number of clicks and orders you received on a per-product basis.
Data feeds make it very easy to implement "tracking URLs" for your products. By implementing tracking URLs, you will be able to see which products are performing well and which simply aren't converting. There are two ways to achieve this:
KEY POINT: In most cases you can optimize your feeds to make almost any campaign profitable. Many merchants look for the "most possible" traffic, but you must realize that your efforts should be focused on finding the "most profitable" traffic. It is important to manage the product listings in your data feeds in order to achieve the greatest profit.
4. GUIDELINES FOR CREATING SUCCESSFUL CAMPAIGNS
The following guidelines will help you create and optimize your data feeds to drive successful campaigns:
Using the techniques outlines above, you should be able to create profitable comparison search engine campaigns using data feeds. Below we have listed related reports and our literature review.
RELATED MEC REPORTS:
Comparison Search Engines Tested:
Yahoo! Store Changes:http://meclabs.com/cgi-bin/pl/pl.cgi?myc
As part of our research on this topic, we have prepared a review of the best Internet resources on this topic.
These sites were rated for usefulness and clarity, but alas, the rating is purely subjective.
* = Decent ** = Good *** = Excellent **** = Indispensable
Search Engine Watch ****
RTML Templates ***
Advanced Media Productions **
Elixir Systems **
It's Your Prerogative - Yahoo! Store Design & Development! **
NewGate Internet **
Solid Cactus **
Data Feeds – Forum ***
Feeding Frenzy, Part 1 ***
How to Create and Send a Froogle Data Feed ***
Paid Inclusion Confusion ***
Yahoo! Product Feed Specification ***
Shopping Search Engines New Opportunities **
SitePoint Forums **
The Froogle Data Feed Format **http://www.siteall.com/articles/Froogle_Datafeed_Format.asp