Investigating the effect of results ranking in sponsored search

Zhe Liu, Bernard J. Jansen, Zach Simon

Research output: Contribution to journalArticle

Abstract

The objective of this research was to evaluate the effect of ad rank on the performance of sponsored search advertising campaigns. In this study, we analyzed a large log file comprised of almost 7,000,000 records spanning 33 consecutive months of a search engine marketing campaign of a major US retailer. The theoretical foundation of this research is serial position effect, including both primacy and recency effects. One way ANOVA and Tamhane's T2 tests are used in this study as our analytical methods. We examined the effect of ad rank on the critical keyword advertising metrics of clicks and conversions, which translate well to the aspect of relevance in information processing theory. Findings from our research indicate that ad rank does have significant effect on both of these online advertising metrics, although it has less direct effect on conversion rates. Primacy effect was found on clicks, indicating a general compelling performance of ads listed on top positions of the first search engine results page. Meanwhile, conversion rates across all sixteen ad positions we investigated follow a relatively stable distribution, with the exception of the first two ads. Ads in these two positions generated extremely high conversion values. However, examining both clicks and conversion rates combined into a single metric of conversion potential, it is apparent that ad rank has a significant effect on the performance of keyword advertising campaigns. Ad appears at the top of the results listing have a much greater conversion potential. The research results reported in this paper are beneficial to companies using search engine marketing as they strive to design more effective advertising campaigns. Implications from this study could lead to more targeted bidding strategies and thus reduce ineffective bidding in keyword auctions.

Original languageEnglish
JournalProceedings of the ASIST Annual Meeting
Volume48
DOIs
Publication statusPublished - 2011
Externally publishedYes

Fingerprint

Marketing
ranking
advertising campaign
Search engines
search engine
marketing
performance
Analysis of variance (ANOVA)
auction
information processing
research results
campaign
Industry
Values

Keywords

  • Keyword advertising
  • Paid search advertising
  • Pay-per-click
  • PPC
  • Search engine marketing

ASJC Scopus subject areas

  • Information Systems
  • Library and Information Sciences

Cite this

Investigating the effect of results ranking in sponsored search. / Liu, Zhe; Jansen, Bernard J.; Simon, Zach.

In: Proceedings of the ASIST Annual Meeting, Vol. 48, 2011.

Research output: Contribution to journalArticle

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