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How Amazon is clobbering Walmart in mobile paid search

paid search

Amazon has the advantage over Walmart in mobile paid search

New data from AdGooroo shows that Amazon.com generated 82.6 million paid search impressions in mobile during January, compared to 6.6 million for Walmart.com, pointing to how bricks-and-mortar retailers remain hesitant to spend on mobile advertising.

While Walmart.com is the second biggest paid search advertiser on desktop, its ranking drops down to 20 on mobile. Bestbuy.com follows Amazon.com as the second biggest paid search advertiser on mobile, but the electronics retailer's 21.7 million impressions in January is still significantly lower than Amazon's total.

“Amazon is getting a substantial portion of impressions based on branded keywords searches, i.e., terms with the brand name Amazon in them,” said Richard Stokes, CEO of AdGooroo, Chicago. “Walmart, by comparison, is getting relatively few.

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“Amazon is doing a better job than Walmart of targeting popular products on mobile search,” he said.

“For some popular products and terms, in fact, Walmart is not even sponsoring keywords, including sodastream, games, Windows 8, Dyson vacuum, iphone 5 cases and Kindle.”

Mobile opportunity
In terms of branded keyword searches, Amazon’s advantage may stem from showrooming, with consumers shopping in a physical store and using their mobile phones to compare prices for the same items on an online retailer such as Amazon.com, per AdGooroo.

The data from AdGooroo points to several interesting trends in mobile paid search.

One of these trends is that some bricks-and-mortar retailers are lagging in mobile search.

Similar to Walmart.com, JCPenney.com ranks number five in desktop search, but comes in 29th place in mobile search.

Additionally, there are a number of marketers who are clearly putting a bigger focus on mobile search marketing compared to desktop/tablet search. This could be because whereas desktop search is already a crowded, competitive space, they see an opportunity to differentiate themselves from their competitors in the mobile space.

For example, itunes.apple.com is in fourth place in mobile search but drops down to 217 in desktop search.

Additionally, PizzaHut.com is in 18th place in mobile search but 193 in desktop.

Directv.com, WellsFargo.com and Chase.com also all rank significantly higher in mobile search than desktop search. For these marketers, the results suggest they are doing a good job of catering to the tendency toward location-oriented searches on mobile.

Learning curve
Amazon needs to advertise aggressively to mobile searchers, who now generate between one-quarter and one-third of all search queries because its revenue depends on following online behavioral trends, per Matt Grebow, group director of paid search at The Search Agency, Los Angeles, CA.

While Amazon does not report mobile revenue, industry estimates place mobile commerce at about 10 percent of total sales, well below the percentage of traffic from mobile devices.

“Amazon’s search strategy has always been predicated on attracting the most number of potential consumers to its site, whether or not they actually buy what they’re looking for,” Mr. Grebow said. “Amazon has positioned its brand as a ubiquitous online marketplace, and in some sense, it needs to spend money on advertising to maintain this image.

“Amazon has also invested heavily in its predictive purchasing tools and is betting visitors will find similar products they’re interested in buying,” he said.

In comparison, Walmart and other bricks-and-mortar retailers are still trying to figure out how mobile searchers are interacting with their Web sites. For example, if mobile searchers are mostly on the go and looking for a nearby store location or store hours, then retailers should focus on accommodating these needs.

Still, it is a risk for any marketer to hold back on reaching mobile searchers giving how quickly their numbers are growing.

“Walmart and other brick-and-mortar retailers, may be hesitant to spend money on mobile advertising too far ahead of their actual mobile revenue,” Mr. Grebow. “The most sophisticated of these companies are, indeed, investing in mobile search, but are also working to understand how their customers interact with their brands across different media on their mobile and desktop sites, as well as in their physical stores.

“Depending on their broader marketing goals, Walmart and its peers may not need to flood mobile searchers with ads,” he said.

“In the end, no online advertiser should ignore mobile devices. The search trends toward mobile are blatantly clear, and companies who ignore the mobile habits of their customers do so at their own peril.”

Final Take
Chantal Tode is associate editor on Mobile Marketer, New York

Associate Editor Chantal Tode covers advertising, messaging, legal/privacy and database/CRM. Reach her at chantal@mobilemarketer.com.

 
Related content: Search, Walmart, Amazon, AdGooroo, paid search, mobile search, Richard Stokes, The Search Agency, Matt Grebow, mobile marketing, mobile

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Comments on "How Amazon is clobbering Walmart in mobile paid search"

  1. Matt Baglia says:

    February 26, 2014 at 10:27am

    It's clear that a mobile paid ad strategy is a must for online retailers. With the worldwide adoption of smartphones, we all are comparing prices against what we perceive to be the cheaper outlet. That outlet being the online. This is a great way for companies like Amazon to sink their teeth into brick and mortar profits.
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