Does The $0.01 CPC Shopping Strategy Work In A Post-COVID World?
For Music Go Round stores starting around March of this year we saw the weekly click volume generated by a $0.01 CPC Shopping strategy plummet going from over 1k clicks a week to around 400. Since then, traffic has continued bottom out going from 200 a week in June to less than 100 a week today.
September 2020 - September 2021. CPC remained at $0.01 yet Clicks dropped from 6000/month to less than 200!
The immediate question is WHY. Why after years of driving thousands of clicks a week at a penny a click are we lucky to get 100 all month long? One word – competition.
The Google Shopping ads space is an auction. The more bidders in the space the higher the price per click required to win the auction and show your ad. Thanks to the pandemic 10 years of Ecommerce adoption was squeezed into less than a year. Retailers, unsurprisingly followed suit, driving up competition and in turn CPCs. While the penny bid strategy worked well in 2020 it gets squashed by the highly competitive landscape of 2030 Ecommerce we’re living in today
The natural follow up question would be “if COVID increased online competition why did we not start seeing the impact until March 2021 – a full year after the virus started?”. Based on our competitive research it seems that around that time Guitar Center and Reverb began dumping huge ad budgets into the musical instrument Shopping space. Their aggressive CPCs quickly outbid our $0.01 bids leading them to win the majority of the available auctions and led our traffic to disappear.
How can you fight back? Increase those bids! Intelligently.
Focus on your high price point items - Guitars, Drums, Band Instruments
Remember CPC “value” is relative to the item you’re advertising. Paying $0.25 to sell a guitar for $500 is still an incredible return on investment. Don’t be afraid to bid higher on popular categories.
Negative keyword match searches that aren’t relevant to your inventory to keep budget from being spent on auctions that don’t match your inventory.
Thanks to the massive adoption of Ecommerce forced by COVID we’re most likely never going to see as light of a competitive environment as we saw leading up to 2020. You can’t keep hoping things will return to “normal” - they won’t. Instead evolve your advertising strategies to reflect the reality of this new post-COVID Ecommerce landscape.
