advertising.yahoo.com
866-924-6676
retail.search@yahoo-inc.com
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a Yahoo! Account Executive today to learn what Search and Display can do for your business.
advertising.yahoo.com
866-924-6676
retail.search@yahoo-inc.com
Conta
Ct
a Yahoo! Account Executive today to learn what Search and Display can do for your business.
Copyright © 2007 Yahoo! Inc. All rights reserved.
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The Internet has had a major impact on the consumer shopping experience. While consumers have the
option to purchase online, the majority of shoppers turn to the Internet to "pre-shop" for information
about products before they head into the store to make a purchase. They have begun the shopping
process without you or your sales team having even met them. And research demonstrates that these
"pre-shoppers" who are exposed to online advertising may be among the most valuable customers for
a retailer.
From April 2006 to January 2007, Yahoo! partnered with comScore to study the impact of search
marketing and display advertising on consumer shopping behavior and the in-store sales of
major retailers. The study involved more than 175,000 panelists and compared the behavior of
those exposed to online advertising versus those who were not exposed. The resulting in-store
purchases were observed at five major retail stores from diverse segments including major national
department stores, a major apparel retailer, and one of the world's largest sellers of office products.
The campaigns generated more than $10.5B in total revenue for our advertisers, of which $2.4B was
incremental revenue.
Following are the results of the study.
The JC Penney website is our shopping hub
for consumers whether they're planning to buy
online or in-store. Therefore, we are continually
focused on developing online marketing and
merchandising programs that help us understand
the relationship between our customers' online
engagement and our in-store sales.
"
"
Dave Abbot
Vice President of Marketing
JC Penney
Implications for Marketers
The results of this study indicate that the availability of product and retailer information online, as well
as exposure to online advertising, is fundamentally changing the way consumers shop. It's important for
retailers to understand the full impact their online presence—as well as their competitors' presence—may
have on consumer in-store behavior.
Retail marketers now have the tools needed to more accurately measure and compare online marketing
ROI to more traditional media ROI. By factoring the in-store sales impact, you account for the full value
of your online marketing program. This includes display's strength in reach and search's strength in lift.
Retailers should carefully evaluate their online marketing mix to ensure an optimal integration of both
search and display. Marketers should consider increased usage of behaviorally targeted online display ads
for maximum impact.
Our online marketing tools can provide a significant opportunity for your ads to get in front of the right
consumer at the right time with the right product. As these research heavy consumers engage with your
products online, you can influence their eventual in-store purchase. In order to maximize the opportunity
for consumers to "pre-shop" your products, retailers need to think beyond e-commerce when designing
their websites and advertising landing pages—they should consider the needs of consumers for "pre-
shopping destinations"—engaging and informative websites that offer in-depth product information,
consumer reviews, a variety of visuals, product comparison tools, opportunities to check local in-store
inventories online, and other interactive tools that provide consumers ways to engage at a deeper level
with your brand and your products.
Research online, Buy offline:
The Impact of Online Pre-Shopping on Consumer Shopping Behavior
Copyright © 2007 Yahoo! Inc. All rights reserved.
search marketing plus display
advertising can drive higher return.
This study examined the individual impact of
search marketing, the individual impact of display
advertising and the synergistic impact of an
integration of search and display.
Search marketing has a greater impact on in-store
sales lift, three times that of display advertising.
When consumers in the study were exposed to
search only, on average they spent $16 in the
store for every $1 they spent online. However, the
number of consumers reached via search is much
smaller than display, creating a relatively small pool
of pre-shoppers with a relatively high propensity
to purchase in-store.
Display advertising has a greater impact on total
in-store sales volume, with three times the reach as
search marketing. Consumers exposed to display
advertising spent an average of $6 in the store for
every $1 they spent online. In other words, display
advertising drives three times the in-store sales
volume while search drives three times the in-store
sales lift.
While both search marketing and online display
advertising can demonstrate significant value
in driving sales, our study showed that the sales
impact of an integrated search and display
campaign is significantly stronger than either
channel used in isolation. This study demonstrates
that exposing consumers to both search and
display can result in significantly higher lifts in site
engagement, in-store purchasers, their average
order size, and subsequently the total in-store
sales revenue.
continued
In-store sales start online.
Years ago, shopping was an in-store event. Today many people are going online to research products and
pre-shop before they even step foot in a store. In fact, according to BIG Research, 89% of consumers making
in-store purchases in key retail categories have
conducted online research prior to purchase.2
This pre-shopping behavior, while relatively
new, has become a common activity prior to
a variety of purchases—both large and small.
According to the study, when pre-shopping
consumers are exposed to online advertising
(search listings or display ads or both) they
engage at a deeper level with your web site,
viewing an average of 6 more pages than those
not exposed, a 53% increase.
In the study, these more highly engaged, online
advertising exposed consumers demonstrated
a much stronger propensity to make a purchase,
resulting in a 43% lift in total revenue, of which
88% of the sales revenue generated from the
online advertising budget was from consumers
that purchased in the physical store.
Additionally, this online advertising exposed
consumer may be your most valuable consumer, as a Forrester Research study noted that 45% of consumers
who research online buy additional products in-store when they buy the product they researched online.3
The results of this study demonstrate that those exposed to online advertising spend an average of 29% more
on their in-store purchase than those who are not exposed.
online advertising drives in-store sales at a 6:1 ratio to online sales.
Most retailers know that online advertising drives online sales. According to this study, online advertising
drives in-store sales at a much higher rate than online sales, indicating the value of online advertising is
perhaps many times greater than currently recognized.
When factoring in only online revenue, the cost as a percent of revenue for online advertising averaged
approximately 11%. When you factor in the full impact of online advertising on in-store purchase behavior, the
cost as a percent of revenue for online advertising is more accurately calculated at 0.5%.4
$1
search &
Display
Search Display
Lift in In-Store
Purchasers
43%
26%
6%
Lift in Pages Viewed
68%
46%
37%
Lift in $ Per Purchaser:
In-Store
83%
26%
11%
Lift in Incremental
In-Store Dollars
90%
43%
15%
search plus display drives significantly
higher sales and online engagement 1
Traditional
Search CPR
Online Ad Spend
Incremental Online
Revenue
Holistic
Search CPR
Online Ad Spend
(Incremental Online
+ Offline Revenue)
0.5%
online advertising drives in-store sales
FIG 2
FIG 3
FIG 4
online advertising can be a highly cost
effective way to drive in-store sales
C
ost
P
er
R
evenue
fig 2
fig 3
fig 4
1
1 & 4
$6
In-Store
Revenue
Online
Revenue
6 to 1
11%
1
68%
Lift vs. Control Group
1 From Clicks to Bricks: The Impact of Online Pre-Shopping on Consumer Shopping Behavior,
Yahoo! and comScore, 2007
2 BIG Research, 2007
3 Forrester State of Retailing Online, 2007
4 Cost assumptions made based on YSM pricing for top retail search terms.