Attribution strategies and return on keyword investment in paid search advertising

摘要

Purpose: To examine how the firm's attribution strategies impact the return on investment of a paid search campaign. Summary: In search engine marketing, spending is on paid or sponsored search results for which the firm pays the search engine. Search engines assist potential customers in finding useful information online by using customer specified search keywords. The search keywords and the sequence in which customers use the specific keywords as they progress in their purchase funnel could significantly differ across the population of potential customers. Similarly, retailers can differ in the mix of keywords they bid for and the amount they bid for each keyword. A wrong or unbalanced mix and/or wrong bid levels may cause the retailer to lose large segments of potential customers. The research work proposes that the attribution strategy a firm uses directly impacts the mix of keywords it bids on and their bid levels under budget constraints and, therefore, impacts the efficiency of customer acquisition and impact the return on investment (ROI) of a paid search campaign. An empirical study is presented to show that the use of single touch attribution strategies such as first-click attribution (assigning all of the conversion credit to the first clicked keyword) or last-click attribution (assigning all of the conversion credit to the last clicked keyword) is likely to lead to inefficient keyword investments and lower ROIs. The model also identifies better attribution strategies that can lead to significantly higher revenues. (21 refs.)