Fresh Ideas... to Turbo Charge Your Keyword Search Advertising Program This Holiday Season

Message from our CEO:

On behalf of the entire NetElixir team, thank you for taking the time to go through this workbook. We hope the “fresh ideas” presented herein will help you run a more efficient keyword search advertising campaign during the 2009 Holiday season.

This is not meant to be a theoretical handbook but rather a practical workbook. We strongly encourage you to use the charts and performance indicators, applying your actual data, in order to derive maximum performance gains.

Do feel free to write to me at udayan@netelixir.com to let me know if you found this workbook interesting and useful.

Happy Reading and Happy Selling!

Regards,

Udayan BoseCEONetElixir,Inc.

Why Do You Need a Search Advertising Workbook?

• Successful keyword search advertising is “75% execution and 25% strategy.”

• We have tested the concepts presented here on more than 200 retailer campaigns.

• While this is not an exhaustive list, it will be a solid base for getting you off to a good start.

• The beauty of the concepts lies in the fact that they can be used on an “as is” basis.

• The ability to conduct smart, objectives-focused tests is key for optimal search advertising.

• Some control sheets presented here need to be filled out by you on a weekly basis. You will thus be able to capture essential trends.

• We place a lot of emphasis on regular data analysis and extracting usable insights. This workbook is meant to serve that purpose for you.

- 1 -

- 2 -

The holiday shopping season spans nearly three months, from early October to end of December.

Source: Google Trends Data

Why Do You Need “Fresh SEM Ideas” for Holiday Season 2009?

• All economic indicators point to one of the toughest holiday seasons ever.

• Revenue realized per dollar spent on SEM has come down over the past year.

• Despite the difficult economy, SEM remains a time tested customer acquisition channel.

• Online shopping behavior is likely to be different this holiday season.

• An advertiser can unlock enormous customer acquisition efficiencies by following some or all of the ideas presented here.

- 3 -

- 4 -

10 Practical Tips to Propel Your Keyword Search

Advertising Results

Build Your Objectives-Investment ScorecardWhy is this important?You will have an overview of investment vs. return on a single sheet. Remember that what you can’t measure, you can’t control.

Reality check: • What is the average CPC ($)? • What is your website’s click to conversion rate (%)? • Are the objectives achievable given the level of investment? • What are the industry benchmarks?

Build Your Objectives-Investment Scorecard

Why is this important?You will have an overview of investment vs. return on a singlesheet. Remember that what you can’t measure, you can’tcontrol.

Objectives Investment

X units of sale Holiday SEM budget, $

Y cost per sale SEM technology, $

Z revenue per sale In-house manpower, $

SEM agency fee, $

Reality check:• What is the average CPC ($)?• What is my website’s click to conversion rate (%) ?• Are the objectives achievable given the level of investment?• What are the industry benchmarks?

- 6 -

Strategic Keyword Bidding during the HolidaysWhy is this important?During the holiday season, the average cost per keyword click (CPC) jumps by 50-80% for categories like flowers and gifts, apparel, and consumer electronics.

5 essential things to remember in keyword bidding• The bidding strategy should be product category-specific (know the categories on which not to

aggressively bid).• Day-parting tactics help in better utilization of advertising budget.• The days of “vanity bidding” (aiming for the top listing position at any cost) are over.• Value per click is the ultimate measure of bidding efficiency.• A conversion is an outcome of multiple clicks on (often) multiple keywords (it is too simplistic to attribute

a conversion to the last keyword click).

Notes:• Since bidding is a real-time process, manual bid management is often not sufficiently expedient, especially for campaigns with

5,000+ keywords. Bid optimization technologies, such as LXRRetail, use complex algorithms to optimally execute this process.

• The bidding strategy should be influenced by both short term as well as long term SEM objectives. The strategy adopted during the holiday season may not apply during other months.

-7 -

Sample Promo-SEM Campaign Calendar

SEM Campaign: Variable Control Chart

Notes:• Analyze outcome against SEM objectives.• Aggregate learning and use for future promotions.

Sample Promo-SEM Campaign Calendar

Nov. 26 – Dec. 2,2009

Dec. 5 – Dec. 9,2009

Dec.18 – Dec. 22,2009

Description ofPromotion & TargetProduct/CustomerSegment

SEM Budget ($)

SEM Objectives

SEM Campaign: Variable Control Chart

Variable Plan Measurable Outcome

Unique Campaigns

Targeted Keywords

Targeted Ad Creatives

Targeted Landing Pages

Notes:• Analyze Outcome against SEM Objectives• Aggregate learning and use for future promotions

Sample Promo-SEM Campaign Calendar

Nov. 26 – Dec. 2,2009

Dec. 5 – Dec. 9,2009

Dec.18 – Dec. 22,2009

Description ofPromotion & TargetProduct/CustomerSegment

SEM Budget ($)

SEM Objectives

SEM Campaign: Variable Control Chart

Variable Plan Measurable Outcome

Unique Campaigns

Targeted Keywords

Targeted Ad Creatives

Targeted Landing Pages

Notes:• Analyze Outcome against SEM Objectives• Aggregate learning and use for future promotions

- 8 -

Sync Your SEM Campaigns with Your Holiday Marketing Promotion CalendarWhy is this important?Tailored, targeted keyword search advertising campaigns deliver superior results.

• Thanksgiving Day: November 26• Black Friday: November 27• Cyber Monday: November 30• Heaviest Online Shopping Day: December 8

Key Shopping Dates 2009

- 9 -

Sync your SEM Campaigns with your Holiday MarketingPromotion Calendar

Why is this important?Tailored, targeted keyword search advertising campaigns deliver superior results.

Online Non-Travel (Retail) Holiday Consumer SpendingExcludes Auctions and Large Corporate PurchasesTotal U.S. – Home/Work/University LocationsSource: comScore, Inc.

Millions ($)

2007 2008 % of Nov 1- Dec 23, 2008

November 1 –December 23

$26,332 $25,537 100%

November 27(ThanksgivingDay)

$273 $288 1.12%

November 28(Black Friday)

$531 $534 2.10%

December 1(Cyber Monday)

$733 $846 3.31%

Heaviest OnlineShopping Day

$881(Dec. 10)

$887(Dec. 9)

3.47%

Key Shopping Dates2009

• Thanksgiving Day: November 26

• Black Friday: November 27

• Cyber Monday: November 30

• Heaviest Online Shopping Day: December 8

Source: comScore, Inc. (NASDAQ: SCOR) is a global leader in measuring the digital world and preferred source of digital marketing intelligence.

Why is this important?You are not advertising in a “vacuum.” The “searcher” always likes to compare before making a purchase.

Know Thy CompetitorsKnow thy CompetitorsWhy is this important?

You are not advertising in a “vacuum.” The “searcher” always likes to compare before making a purchase.

You Competitor 1 Competitor 2

Product

Price

Promotions

Brand strength

Estimated SEM spend

Number of keywords

Unique selling points (adcopy and landing page)

Average ad listingposition

Specific SEM tacticsemployed (e.g., day-parting)

- 1 0 -

5 KPI’s Every Search Advertiser NeedsWhy is this important?A portfolio of key performance indicators (KPI’s) is needed to measure SEM driven customer acquisition performance in a holistic manner.

KPI Checklist1. Profit per click 2. Revenue per new customer (through SEM)/Revenue per customer (overall)3. Average Order Value per new customer4. Cost Per Conversion (Search)/Cost Per Conversion (All Channels)5. Percentage of (converting keywords/all keywords)

Notes:• Set KPI benchmarks before starting your campaign.• Track above KPI’s on a weekly basis.• Understand the campaign variables you need to control.

- 1 1 -

Creating Your Targeted Holiday Keyword ListWhy is this important?A targeted keyword list helps you gain appropriate reach coupled with high conversion probability.

The 5 Stage Optimal Keyword List Building Process (Continuous Cycle)

Creating your Targeted Holiday Keyword ListWhy is this important?A targeted keyword list helps you gain appropriate reach coupled with highconversion probability.

The 5 stage optimal keyword list building process (continuous cycle)

Stage Notes

Research Listening platforms suchas Twitter are valuablereal-time keyword sources

Select and Group Each keyword you selecthas to contribute towardscampaign objective(s)

Test Allocate 3-5% of yourSEM budget to testingkeywords for 60 – 90 days

Analyze Assess how well akeyword fits in an adgroup

Refine Classify keywords intofour performance groups –STARS, ASPIRANTS,LAGGARDS, andQUESTION MARKS

- 1 2 -

Differentiate Through Targeted Ad CopyWhy is this important?Relevant ad copy helps you stand out from the clutter. You can thus differentiate yourself, pre-qualify visitors, and build brand credibility.

5 questions your ad copy writer needs to answer1. At whom is your ad copy targeted?2. Does your ad copy convey your uniqueness?3. What will compel the searcher to click on your ad (and not your competitor’s)?4. Where does the searcher expect to land on your website post clicking?5. Is your ad copy relevant to the keyword search query?

Notes:• We recommend the creation of dedicated ad groups with tailored ad copy sets.• Ad copy performance needs to be monitored on a weekly basis.• Ten percent of low performing ad copy (that has been live for at least 90 days) across the entire account should be replaced

with a fresh set of ad copy.• Allocate a percentage of your ad budget to test new ad copy every month.

- 1 3 -

Use Twitter to Create “Immediate” CampaignsWhy is this important?Campaigns built around keywords extracted from “tweets” are more immediate and relevant and therefore hold greater monetization potential.

Targeted Campaign Creation Process Using Twitter 5 Benefits of Using Twitter for SEM

Use Twitter to Create “Immediate” Campaigns

Why is this important?Campaigns built around keywords extracted from “tweets” are more immediate and relevantand therefore hold greater monetization potential.

Targeted Campaign Creation Process Using Twitter

5 Benefits of using Twitter forSEM

1. Monetization potential ofrecent conversations

2. Edge over competitors3. Higher relevancy to

customers4. Significantly lower cost per

click5. Brand reputation

enhancement

1. Monetization potential of recent conversations

2. Edge over competitors 3. Higher relevancy to customers 4. Significantly lower cost per click 5. Brand reputation enhancement

- 1 4 -

Make Transactional Landing Pages Relevant Why is this important?A relevant landing page builds trust, demonstrates consistency of message, and guides the visitor along a logical conversion path.

5 things to keep in mind when building transactional landing pages1. Maintain consistency of message and deliver what you promise, i.e., search query => ad copy => landing

page.2. Segment visitors and guide them along the appropriate conversion paths.3. Keep the page simple – visitors should easily know “what to do next.”4. Establish landing page specific KPI’s that link to overall campaign KPI’s (e.g., dropout rate at landing page

mapped to final conversion rate).5. Test – Test – Test.

Notes:• Landing pages convey the core values of a website.• The landing page, along with ad copy, is responsible for building brand credibility more than any other “contact element.”.• Online shoppers “love” simple, linear conversion paths.

- 1 5 -

SEM Performance Forecasts, Holidays 2009 (Nov. 1 – Dec. 23)Select Categories Forecasts, Holidays 2009 (Nov. 1 – Dec. 23)

Category Clicks, y/ygrowth

CPC, y/ygrowth

CTR, y/ygrowth

Flowers & Gifts

Apparel

ConsumerElectronics

Food & Drugs

HomeFurnishings

Pet Supplies

HomeImprovement

For the above categories, on an aggregate level, we expect the total clicks to go up by 2-3%, CPC to go down by 3-5%, and CTR to go up by 6-8%.

- 1 6 -

For the above categories, on an aggregate level, we expect the total clicks to go up by 2-3%, CPC to go down by 3-5%, and CTR to go up by 6-8%.

The Importance of Trademark/Brand Name KeywordsWhy is this important?Trademark or brand name terms are more likely to be the “last clicked keywords” for a conversion. Their contribution to total account conversions has increased by 5-8% over the last 12 months. Shoppers feel more “secure” buying from “known name” firms.

5 things to consider when buying trademark terms1. Evaluate the performance of brand terms separately from non-brand terms.2. Anticipate more advertisers to bid for your trademark terms (due to Google’s new trademark bidding

policy) and prepare accordingly.3. Ad copy that conveys the brand values clearly will do better.4. It is not uncommon for your affiliates to use your URL as display URL in their ad copy. This may result in

your ad not showing at times; ensure this is avoided.5. Research proves that advertising on sponsored listings for trademark terms, even if you appear prominently

in organic listings, adds to performance.

- 1 7 -

• Ad Copy: A commercial message targeted to an advertiser‘s customer or prospect.

• Campaign: Defines the daily budget, language, geographic scope and the networks where ads are displayed.

• Clicks: Metric which measures the reaction of a user to an Internet ad.

• Conversion: A conversion occurs when an ad click leads directly to some valuable user action such as a purchase, sign-up, registration, lead.

• Cost per conversion: The advertiser’s cost to generate one sales/ conversion transaction.

• CPC: The amount an advertiser pays to the search engine every time a user clicks on his ad listing.

• CTR: Ratio of ad clicks to ad impressions.

• Impression: A measurement of responses from a Web server to a page request from the user browser, which is filtered from robotic activity and error codes, and is recorded at a point as close as possible to opportunity to see the page by the user.

• Keyword advertising: A type of advertising that uses keywords to trigger ads. Typically, advertisers select a set of keywords related to the product or service they wish to advertise. The ads are then displayed in relevant places based on those keywords.

• Landing pages: The actual URL of the page that an ad links to.

• Organic listing: Organic search results in search engine result pages that appear because of their relevance to search terms, as opposed to their being advertisements.

• PPC: The pricing structure used by some online channels to charge an advertiser each time a user clicks on the advertiser’s ad listing. The amount is usually set by the advertiser, not by the channel. Also called cost-per-click (CPC).

• SEM: A form of Internet Marketing that seeks to promote websites by increasing their visibility in the Search Engine result pages.

• Tweets: Tweet is a post or status update on Twitter.

• URL: A URL (which stands for Uniform Resource Locator) is the location of a webpage or file on the Internet.

Glossary

- 18 -

NetElixir, Inc., is a Princeton, NJ, based online customer acquisition management firm with offices in New York, London, India, Germany, and Denmark.

The company advises clients worldwide on online customer acquisition strategies and, using its proprietary technology - the LXR core platform, helps them achieve online advertising performance maximization.

Website: www.NetElixir.comEmail: info@netelixir.comBlog: http://netelixir.typepad.comTwitter : http://twitter.com/udayanboseTwitter : http://twitter.com/netelixir

About NetElixir

- 19 -

- 20 -

NetElixir Global OfficesGlobal Headquarters 475 Wall StreetPrinceton, NJ 08540USAPhone: +1-609-356-5112Email: info@netelixir.com US Offices 77 Great Road, Suite 204Acton, MA 01720USAPhone: +1-978-314-8484Email: sales@netelixir.com

80 Maiden LaneNew York, NY 10038USAPhone:+1-646-831-8670Email: sales@netelixir.com

Europe Offices Schwarzwaldstrasse 34079117 Freiburg, GermanyPhone: +49-172-620-4921Email: sales@netelixir.de Nitivej 102000 FrederiksbergCopenhagen, DenmarkPhone: +45-6128-9880Email: sales@netelixir.dk New Broad Street House35, New Broad StreetLondon EC2M INHPhone: +44 -203-393-6937sales@performancesearch.co.uk

Asia Pacific Office #001 & 002,Jyothi Bhopal Chambers,#7-1-19/5, Begumpet,Hyderabad 500016AP, India Phone: +91-40-4003-8996

- 21 -

www.netelixir.com