PM Digital Research

The online holiday shopping season so far brings glad tidings, with a strong kickoff in late November marked by solid year-over-year growth. Not surprisingly, growth was driven by several key days around Thanksgiving, including Cyber Monday and Black Friday, but there’s more to the story. Cyber Monday was the month’s top paid search sales day by volume, for yet another year, by a huge margin. Conversion rates on Cyber Monday, already strong, improved significantly vs. last year and drove that day’s revenue growth. However, growth metrics for revenue, order and clicks were actually the highest for the day before, on what might be called “Cyber Sunday.”

The November 2011 edition of PM Digital’s Rewind Index, which measures monthly U.S. paid search performance for online retail clients, showed an average 48% year-over-year revenue growth for the month. Clicks grew the same percentage, and PM Digital retail clients increased total search spend by nearly as much (47%). This was driven mainly by rising clicks, as CPCs were up only 2%. Average orders saw a 5% increase vs. last year.

November 2011 Top Sales Day: Mon 11/28 (Cyber Monday)

Other Key Sales Days (in descending order):

Fri 11/25 (Black Friday)
Sun 11/27
Tues 11/29
Wed 11/30
Sat 11/26

While Cyber Monday and Black Friday are definitely affecting buyer behavior on other nearby days, before and after Thanksgiving, these two dates remain unbeatable for single-day revenue and orders from paid search. Purchases in this channel spiked on Black Friday and remained high through the 30th—a trend we expect to see continue into December.

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Paid search growth trends continue to accelerate for online retailers.  As 2011 winds down and the crucial holiday season approaches, October saw even stronger year-over-year growth for revenue, orders, clicks and conversion than September, which itself had outpaced prior months.  PM Digital’s October 2011 Rewind Index, which measures monthly U.S. paid search performance for online retail clients, found 53% annual growth in revenue and 33% growth in clicks—the largest monthly increases in both metrics all year.  Average orders also saw a healthy 7% increase, an indication of a positive mood among online consumers.  PM Digital retail clients increased total spend by an average 40%, mainly due to a boost in clicks rather than CPCs.

Columbus Day was the peak online retail sales day for paid search campaigns, and its year-over-year metrics were also strong, with 67% revenue growth on that day outpacing the October average.

YoY Performance Metrics for October 2011

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Online retailers active in paid search had a strong August, with some of the best
year-over-year growth in that channel in months.  PM Digital’s August 2011
Rewind Index, which measures monthly U.S. paid search performance for online
retail clients, shows that August revenue from paid search campaigns was up 24%
year-over-year with a 17% increase in spend.  The top days for August were
Mon 8/15 through Wed 8/17, although Mon 8/22 and Wed 8/31 were also key.
Rising sales at the month’s end, especially mid-week, were a good sign heading
into fall and Labor Day promotions.  Paid search clicks for August
increased 11%, after several months of flat or slightly negative growth.
This points to pent-up demand in the back-to-school and fall sale season, and
also suggests consumers are researching purchases.  Conversion rates
improved strongly in August, up 23%, the eighth consecutive month of double-digit
year-over-year growth.  The combination of significant growth in both
conversion and clicks, on top of 6% growth in average orders, is a great sign
for end-of-year.

Sales were low during the weekend Hurricane Irene hit the east coast (Fri 8/26-Sat
8/27), but not dramatically lower than a typical weekend in August.  This
suggests that the unusual weather — truly devastating for some communities –
was limited in its impact on paid search campaigns and online sales overall
because of its weekend timing.  Of course, merchants had varying
experiences given their unique circumstances.

YoY Performance Metrics for August 2011

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Online retail in June continued to see healthy growth despite another consumer confidence dip and more mixed signals from brick-and-mortar retail (though gas prices did improve some).  PM Digital’s June 2011 Rewind Index, which measures monthly U.S. paid search performance for online retail clients, shows that June revenue from paid search campaigns was up 16% year-over-year on a comparatively modest 2% spend increase.  Conversion rates for paid search again saw double-digit growth, rising an impressive 24%, and this strong conversion was the biggest factor behind revenue growth in June, though increasing average orders (+5%) also helped. Rewind’s monthly paid search clicks index registered a -4% dip for June which, given the higher conversion rates, indicates that retailers on average saw their paid search ad dollars become more efficient during the past month with fewer non-converting clicks, though performance naturally varies by advertiser.

Revenue and orders were slightly higher in the first half of June, though all performance metrics adhered to a weekly rise-and-fall pattern, with regular peaks at the start of each week and dips on weekends.  The best overall day was Mon 6/13, partially driven by Father’s Day promotions but also summer sales making room for back-to-school and fall merchandise.

YoY Performance Metrics for June 2011

June 2011 Top Sales Day: Mon 6/13

Other Key Days (in descending order):

Orders: Wed 6/15, Thu 6/9
Revenue: Mon 6/6, Tues 6/7, Wed 6/15

Paid search revenue and order volume for June 2011 peaked on Mon 6/13, making it the top overall sales day for the month.  The second-best day for orders was Wed 6/15, while the next-best revenue day came on Mon 6/6.  All of the best days coming in the first half of the month suggests that Father’s Day, which fell on Sun 6/19 this year, drove at least some sales.

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Higher gas prices and a dip in consumer confidence in May were blamed for the mixed sales reports from brick-and-mortar retailers, but online retailers continue to buck the trend by outperforming the retail sector overall.  PM Digital’s May 2011 Rewind Index, which measures monthly U.S. paid search performance for online retail clients, shows that May revenue from paid search campaigns was up 21% year-over-year.  Conversion rates, which have been rising steadily for several months, improved by 27% in May and boosted paid search revenue despite the fact that clicks basically held their own, with only a modest 1% uptick.  This levelness in clicks also meant that an increase in May CPCs translated into a parallel increase in overall paid search spend–both metrics grew 14%.  May’s best day was Memorial Day, Mon 5/30, when sales were at their highest.  Smaller peaks occurred mid-month and in early May.

YoY Performance Metrics for May  2011

May 2011 Top Sales Days (Revenue & Orders):  Mon 5/30 (Memorial Day), Sun 5/15, Tues 5/17, Mon 5/16

Memorial Day, Mon 5/30, was the top sales day for May 2011.  Paid search revenue and order volume both peaked on this traditionally strong day for consumer offers and start-of-summer sales.  A second smaller peak in sales came mid-month, and a modest third one occurred over the first three days, possibly related to last-minute shopping for Mother’s Day.

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Paid search spend in April was up 27% year-over-year and generated revenue growth of 33% for this channel, according to PM Digital’s April 2011 Rewind Index, which measures monthly U.S. paid search performance for online retail clients.  Clicks were up 9%, and average conversion rate continues to be one of the strongest growth metrics with a 33% increase.  For the second consecutive month, average orders were 4% larger than a year ago.  April’s top days all came at the start of the month, continuing the momentum seen at the end of March.  Top days were also the same across the metrics of spend, clicks, orders and revenue.

YoY Performance Metrics for April 2011

April 2011 Top Sales Days (Revenue & Orders):  Sun 4/3, Mon 4/4

The best days in April for PM Digital retail clients came very early, with sales revenue and order volume both peaking equally high on Sun 4/3 and Mon 4/4.  This brisk early activity came on the heels of a strong finish for March, making for a sustained sales bump that is the highlight of the Spring season to date.  The only notable decline was Easter weekend (4/25-26).

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March continued to see growth in both paid search expenditures and revenue, which PM Digital has been tracking consistently since last spring.  PM Digital’s March 2011 Rewind Index, which measures monthly U.S. paid search performance for online retail clients, shows that revenue from this source was up 39%, on a spend increase of 30%.  Clicks were up a healthy 12% year-over-year, and for the second consecutive month, improvement in the average conversion rate outpaced the growth in all other metrics.  Average orders saw another modest increase vs. last March.  The end of the month produced all of the top sales days, a good sign as online retailers head into April.

YoY Performance Metrics for March 2011

March 2011 Top Sales Days (Revenue):  Thu 3/31, Tue 3/22, Tue 3/29, Sun 3/27
March 2011 Top Sales Days (Orders):  Tue 3/29, Sun 3/27, Thu 3/31, Tue 3/22

As mentioned, all of March’s top sales days for PM Digital retail clients came at the end of the month.  Furthermore, these top days were the same whether measured by order volume or revenue, though they varied slightly in ranking. Revenue peaked on Thu 3/31 and Tue 3/22, while orders peaked Tue 3/29 and Sun 3/27.  In general, the month did not see significant spikes in the data as in other months, which can be expected since March has few traditional retail holidays. The end-of-month uptick can be seen even more clearly when the data is rolled up by week (below).

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