How To

Portfolio Bidder Setup

ChannelAdvisor is thrilled to announce the release of the industry’s first portfolio bidder designed specifically for retailers. Using a proprietary algorithm to predict metrics such as CPC and revenue at various possible keyword ranks, our bidder then optimizes bids within the portfolio to maximize revenue. Ongoing bid combination experiments that improve over time through a consistent feedback loop help drive consistent performance improvements. The portfolio bidder has shown to drive up to 300% lift in conversion rates while keeping overall ERS in line with goals.

Click below to download our one-pager:

 

How the Portfolio Bidder Works


By predicting performance metrics for keywords at various ranks, and using like keywords’ data to estimate metrics for those keywords that don’t have enough history to allow for individual prediction, ChannelAdvisor’s portfolio bidder increases overall revenue while staying at high level ERS (or ROI) goals. By incorporating an element of ongoing bid testing and predictive analysis, while keeping the flexibility needed for retailers, we’ve developed a bidder that maximizes revenue per click.


(Click image to expand.)

 

Campaign Characteristics


Portfolio bidding has shown success in campaigns with the following characteristics:

  • Lower average click volume per keyword
  • Well-structured ad groups
  • New products/keywords
  • ERS outside desired range but with revenue opportunities (expensive KW on top selling products)

The portfolio bidder can also improve overall revenue coming from high volume keywords such as brand terms, but often these keywords have less room for improvement and therefore don’t show as dramatic a shift as others.

 

Tasks to Complete


Complete the following tasks:

  1. Setup the Portfolio Bidder
  2. Select the Strategy
  3. Assign Your Portfolio

 

Setup

To begin setting up the portfolio bidder:

  1. In ChannelAdvisor, navigate to Digital Marketing > Marketing Management > Automated Bidding .
  2. Select New Portfolio Optimization .
  3. Select your Provider . For the Portfolio Optimizer, you should select Google AdWords. Note that an ad group can only be assigned to a single portfolio.
  4. Name your rule.
  5. Select the Date Range: Tell us how much historical data you want us to use in the calculations. A longer date range will give more data but will be less responsive to changes in seasonality.

 

Strategy

Next, select the strategy for the bidder:

  1. Choose what you want the bidder to Maximize Revenue or Profit (if you are sending us product cost data).
  2. Specify the Constraints :
    1. Within this maximization you can limit the bidder by selecting either a Target ERS or Budget (per day).
    2. Enter either the Target ERS % or Budget dollar amount.
    3. Please be aware that limiting by budget does not stop ad serving on the providers at that daily spend but rather maximizes the revenue within the portfolio for that budget. When estimates are not 100% accurate, it will spend above or below your desired amount and can always over-spend unless you set daily budgets at the provider.

 

Assign Your Portfolio

Now, pick the Ad Groups that you would like grouped together as a portfolio. It is highly recommended that you pick ad groups with similar keyword types. You might want to lump all your category terms in a similar ad group, versus all the ad groups in a campaign. For example, if you sell shoes and have your campaigns broken out by vendor brands, it would make more sense to group your “nike running shoes” and “saucony running shoes” ad groups together in a portfolio, than to group “nike running shoes” with “nike womens apparel”, unless those ad groups exhibit similar behavior. Since we know how retail accounts are typically structured, we’ve built in this flexibility to work best in a retail world!

  1. From the Portfolio section, in the Ad Group selection box, use the filters to search for the ad groups you would like to add to the portfolio.
  2. When an ad group is found, check the box for the ad group and click Assign .
  3. Repeat for all ad groups as needed for the portfolio.

Keep in mind that when the portfolio bidder doesn’t have enough information to determine how to bid an individual keyword, it will look for clues from the performance of other keywords that you put in the same portfolio. You should also be sure to pick enough Ad Groups/Keywords so that there are enough inputs to give the bidder good data to work with.

All Done!

Now, click Save , and you’re all set up! Give it some time. The portfolio bidder needs several weeks before you will start to see measurable performance as the initial bid testing needs to feed performance back into the inputs before it can determine if those test bids were successful. It gets smarter over time, so be patient!

 

Success Stories


In identical campaigns, targeting different geographies with the same keywords, those managed by the portfolio bidder consistently out-performed those being managed manually or by rules based bidding. In fact, in several of our isolated test cases, ERS was cut by over half, revenue nearly tripled and conversion rates more than doubled! The identical campaign saw ERS increase, revenue decrease and conversion rates increase by less than 10%.

At the same time, an identical test was run on different campaigns, reversing the geographies, and in this second test, we again saw that the portfolio bidder out-performed rules-based bidding when optimizing for revenue within an ERS goal. In the second test, the portfolio bid campaign increased orders by over 90%, while staying below the ERS of the rules-based bid campaign.

In another test, the portfolio bidder powered a drop in ERS of over half, while increasing conversion rate by over 50%. The final result? Nearly identical revenue at at 57% reduction in cost.

In a test of portfolio bidder working on one provider account and rules-based bidding on the other, portfolio bidder tripled conversion rates when bid rules improved only 25% during the same time. At the same time, the account using portfolio bidder cut ERS in half and the bid rules account improved only marginally.

ChannelAdvisor is thrilled to announce the release of the industry’s first portfolio bidder designed specifically for retailers. Using a proprietary algorithm to predict metrics such as CPC and revenue at various possible keyword ranks, our bidder then optimizes bids within the portfolio to maximize revenue. Ongoing bid combination experiments that improve over time through a consistent feedback loop help drive consistent performance improvements. The portfolio bidder has shown to drive up to 300% lift in conversion rates while keeping overall ERS in line with goals.

Click below to download our one-pager:

 

How the Portfolio Bidder Works


By predicting performance metrics for keywords at various ranks, and using like keywords’ data to estimate metrics for those keywords that don’t have enough history to allow for individual prediction, ChannelAdvisor’s portfolio bidder increases overall revenue while staying at high level ERS (or ROI) goals. By incorporating an element of ongoing bid testing and predictive analysis, while keeping the flexibility needed for retailers, we’ve developed a bidder that maximizes revenue per click.


(Click image to expand.)

 

Campaign Characteristics


Portfolio bidding has shown success in campaigns with the following characteristics:

  • Lower average click volume per keyword
  • Well-structured ad groups
  • New products/keywords
  • ERS outside desired range but with revenue opportunities (expensive KW on top selling products)

The portfolio bidder can also improve overall revenue coming from high volume keywords such as brand terms, but often these keywords have less room for improvement and therefore don’t show as dramatic a shift as others.

 

Tasks to Complete


Complete the following tasks:

  1. Setup the Portfolio Bidder
  2. Select the Strategy
  3. Assign Your Portfolio

 

Setup

To begin setting up the portfolio bidder:

  1. In ChannelAdvisor, navigate to Digital Marketing > Marketing Management > Automated Bidding .
  2. Select New Portfolio Optimization .
  3. Select your Provider . For the Portfolio Optimizer, you should select Google AdWords. Note that an ad group can only be assigned to a single portfolio.
  4. Name your rule.
  5. Select the Date Range: Tell us how much historical data you want us to use in the calculations. A longer date range will give more data but will be less responsive to changes in seasonality.

 

Strategy

Next, select the strategy for the bidder:

  1. Choose what you want the bidder to Maximize Revenue or Profit (if you are sending us product cost data).
  2. Specify the Constraints :
    1. Within this maximization you can limit the bidder by selecting either a Target ERS or Budget (per day).
    2. Enter either the Target ERS % or Budget dollar amount.
    3. Please be aware that limiting by budget does not stop ad serving on the providers at that daily spend but rather maximizes the revenue within the portfolio for that budget. When estimates are not 100% accurate, it will spend above or below your desired amount and can always over-spend unless you set daily budgets at the provider.

 

Assign Your Portfolio

Now, pick the Ad Groups that you would like grouped together as a portfolio. It is highly recommended that you pick ad groups with similar keyword types. You might want to lump all your category terms in a similar ad group, versus all the ad groups in a campaign. For example, if you sell shoes and have your campaigns broken out by vendor brands, it would make more sense to group your “nike running shoes” and “saucony running shoes” ad groups together in a portfolio, than to group “nike running shoes” with “nike womens apparel”, unless those ad groups exhibit similar behavior. Since we know how retail accounts are typically structured, we’ve built in this flexibility to work best in a retail world!

  1. From the Portfolio section, in the Ad Group selection box, use the filters to search for the ad groups you would like to add to the portfolio.
  2. When an ad group is found, check the box for the ad group and click Assign .
  3. Repeat for all ad groups as needed for the portfolio.

Keep in mind that when the portfolio bidder doesn’t have enough information to determine how to bid an individual keyword, it will look for clues from the performance of other keywords that you put in the same portfolio. You should also be sure to pick enough Ad Groups/Keywords so that there are enough inputs to give the bidder good data to work with.

All Done!

Now, click Save , and you’re all set up! Give it some time. The portfolio bidder needs several weeks before you will start to see measurable performance as the initial bid testing needs to feed performance back into the inputs before it can determine if those test bids were successful. It gets smarter over time, so be patient!

 

Success Stories


In identical campaigns, targeting different geographies with the same keywords, those managed by the portfolio bidder consistently out-performed those being managed manually or by rules based bidding. In fact, in several of our isolated test cases, ERS was cut by over half, revenue nearly tripled and conversion rates more than doubled! The identical campaign saw ERS increase, revenue decrease and conversion rates increase by less than 10%.

At the same time, an identical test was run on different campaigns, reversing the geographies, and in this second test, we again saw that the portfolio bidder out-performed rules-based bidding when optimizing for revenue within an ERS goal. In the second test, the portfolio bid campaign increased orders by over 90%, while staying below the ERS of the rules-based bid campaign.

In another test, the portfolio bidder powered a drop in ERS of over half, while increasing conversion rate by over 50%. The final result? Nearly identical revenue at at 57% reduction in cost.

In a test of portfolio bidder working on one provider account and rules-based bidding on the other, portfolio bidder tripled conversion rates when bid rules improved only 25% during the same time. At the same time, the account using portfolio bidder cut ERS in half and the bid rules account improved only marginally.

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