Comparing PPC Metrics of Retail, Product Brand & Non-Branded Keywords in the Sporting Goods Category

With Spring springing outside, and my daydreams increasingly occupied by thoughts of outdoor fun and games, I recently completed an analysis of pay-per-click activity in the Sporting Goods shopping category (US only).
During the course of that analysis, I reviewed the Top 100 category keywords (in terms of estimated volume of AdWords queries in Q4 2011) and designated each of those keywords as Retail Brand, Product Brand or Non-Branded. Whether one or multiple words, if the keyword contained a recognizable brand name, I designated it as “Branded”. (The only exception to this was “Nordic track” which I judged to have become a generic term describing a specific type of exercise equipment.)

 Fully 62% of the most queried Sporting Goods terms in Q4 were Branded, with 13 of the Top 100 keywords belonging to Retail Brands, both online and offline, and 49 to Branded Products. The Retail Brands received a disproportionate share of searches, 28% versus 43% for the Branded Products. The 38 Non-Branded keywords in the Top 100 received only 29% of search volume during the quarter.

  • North Face and two spelling variants were actually the top three Branded Sporting Goods keywords and the top three most search keywords overall in the category. The next four Branded terms included Columbia, Dick’s Sporting Goods, Adidas and Academy (an e-tailer)
  • The top five Non-Branded keywords were golf, elliptical, treadmill, soccer and golf clubs

So, branding is alive and well in this category with high awareness and high interest.

Digging deeper into the performance metrics of the different categories of terms, we found that the 13 Retail Brand terms had the highest average click-through rate (10.1%) and the lowest average CPC ($0.71) within the Top 100 keywords. This relatively high CTR indicates that consumers are searching on Retail Brand names with the intention of visiting the Retailer’s site (and are using the Google search box rather than their browser address bar). However, almost 90% of those searchers are either not clicking through, or are visiting a different site, perhaps a competing Retailer.

Meanwhile, the 49 Product Brand keywords in the Top 100 had a lower average click-through rate (2.77%) and a higher average CPC ($1.00) than the 38 Non-Branded keywords (at 3.42% and $0.90, respectively). Note, these are all weighted averages based on the number of search impressions in the period.

SG CPC CTR graphic

The lower average CTR of Product Brand compared to Non-Branded terms suggests that the Brand name searchers may be less committed to their searches than those searching more generally. But the higher average CPC suggests that advertisers attach more value to Branded search visitors than to Non-Branded search visitors. I suspect that:

  • Searchers on Non-Branded Sporting Goods terms are higher (earlier) in the purchase funnel and are more likely to be exploring and seeking information about the sport or activity. Meanwhile, Branded term searchers are likely to be lower (later) in the purchase funnel, having picked a Brand to explore, and may only click through if they see new information (offers, styles, sources) displayed.
  • When the Branded term searchers click through, they are probably more likely to purchase than Non-Branded term searchers. This would explain the higher expected value, and thus the higher CPC, for the Branded term visitors.
  • I suspect that the specific “location intent” and/or store loyalty of searchers on Retail Brands makes them less valuable, on average, to competing SEMs than the average Product searcher, whether Branded or Non-Branded.

I recently published a white paper about Paid Search in the Sporting Goods retail category (available for download here) and in it I’ve fleshed out in more detail my thoughts about the expected value of searchers on different types of terms.