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Retail recipe for success this holiday season

This holiday season looks a little different. Search behavior is more fluid than ever and life during a pandemic hasn’t gotten any easier. But the opportunities for success this holiday season for retailers are all still there, so how can we help you keep up? How can you react when things are uncertain and optimise when you don’t have as much time for manual updates? How can we help you do more with less?

We started by looking at the holiday trends from Microsoft Advertising Insights. Now, let’s connect that to some of our favourite product “ingredients” that make up the retail recipes for success and the must-have staples to help you achieve more during trying times this holiday season.

Two of our favourite “recipes” for success: Dynamic Discovery and Volume Precision

Recipe #1: Dynamic Discovery (Ingredients: Dynamic search ads, automated bidding and audience targeting)
When you think about adapting to changing situations, the first product “ingredient” that comes to mind should be dynamic search ads. They take content from your website and match it to all the relevant queries people are searching for, perfect when search trends are constantly in flux. It’s such a powerful tool for capturing search behavior: on average, about 90% of DSA impressions for a given DSA advertiser are from queries that were only found by DSA.

But how can it work even better for you? Recent internal data has shown that DSA creates great synergy when paired with automated bidding and/or audience targeting, a “recipe” we’re calling Dynamic Discovery

As an example, when DSA advertisers leverage Target CPA as a bid strategy, they got 32% more conversions per dollar spent on average compared to those with manual bidding, as well as 24% lower CPAs. In the case of audience targeting, layering in targets such as in-market audiences and remarketing provided an average increase in conversion rate as high as 41% compared to DSA campaigns using no audiences.  

Note: given that one of the key benefits of dynamic search ads is discovering new keyword opportunities and searchers, you may be limiting your reach by leveraging audience targeting with your DSA campaigns. You can make adjustments depending on your goals for the holiday season. 

Learn more about what’s new with audience targeting from our announcement earlier this month
  Product view of table comparing search strategies.
Our suite of automated bidding strategies. Target ROAS will be coming to all advertisers very soon!

Recipe #2: Volume Precision (Ingredients: Search partners and automated bidding)
Microsoft Advertising’s search partners are also a great source of additional quality volume for when your holiday race begins. But how can you manage that new volume to make sure it’s working well for you when there’s less time for manual optimisation?

This is where our second favourite recipe comes in: Volume Precision. By combining search partners with our automated bidding strategies, Microsoft Advertising’s algorithms gain access to performance data across multiple sites and apps. It then uses it to prioritise the best publishers and deprioritise low-converting partners. 

As a result, on average, we’ve found that CPA for search partner volume is 20% better for advertisers that are fully running on enhanced CPC. And in the case of a large US advertiser, they had a 58% drop in CPA with enhanced CPC compared to their previous performance. But this technology (and thus, the potential success) applies to any of our six automated bidding tactics (see above), so choose which tactic works for you and let Microsoft Advertising help with those micro-optimisations so you can save time. 

We hope these “recipes” are a great start for driving success, but let’s end with some of the must-have staples all retailers should have for their holiday season. 

Must-have staple #1: Microsoft Audience Ads
Microsoft Audience Ads provide new ad types and surface areas to reach your customers. We see much higher increases in searches and clicks for retail after user exposure on the Audience Network. Retail advertisers saw a 61% lift in impressions and an 80% lift in clicks post exposure. These numbers show how important reaching the right audience and targeting your shoppers throughout their customer journey.

Must-have staple #2: Microsoft Shopping Campaigns
Microsoft Shopping Campaigns are really a “super” ingredient as there are so many features within Shopping Campaigns to set you up for success this holiday season. 
  • If you have brick and mortar stores, set up Local Inventory Ads (LIA). We’re seeing increases in traffic and retail sales happening online, but the bulk of retail purchases are still happening in stores. Promote your in-store inventory and drive traffic to your stores with LIA.
Product view of Microsoft Shopping Campaigns.
  • With the increases in buy online and pickup in store (BOPIS) searches, we’ve added the Curbside pickup badge to alert your shoppers of this convenient option. You can include this badge for your LIA campaigns and the Store Pickup badge is an automatic extension for your text ad campaigns. For the text ads extension, buy online or curbside pickup must be mentioned in your ad copy or sitelink text.
Product view of a curbside pickup badge displaying in an ad.
  • Merchant Promotions highlight all your best offers and can be product specific or sitewide. You can create promotions through Merchant Center or they can be uploaded via a feed. And these can be scheduled in advance to save you time when the busy season is in full swing.
Product view of a Merchant Promotion displaying in an ad.    
  • Flyers is a Microsoft-exclusive experience that allows you to promote your top deals and hottest products. Flyers can be displayed as a text ad extension or appear in our Flyer carousel experiences. These can also be scheduled in advance.
Product view of a flyer ad extension displaying in an ad.    
  • We recently launched Product Listings, which are free placements that appear on the Shopping Tab, providing a rich selection of inventory and stores to shoppers. All Shopping Campaign advertisers are automatically opted in for these free placements. If you haven't created Shopping Campaigns yet, you can create a store in Merchant Center and upload your feed to begin receiving free traffic to your products.
    Product view of displaying paid product ads and free product listings ads.


  • Smart Shopping Campaigns are in open beta and accepting hand raisers. This is another way to do more with less time — you send your feed, set your budget, and your bidding target, without the overhead of creating or optimising campaigns. These campaigns have a learning period of 1-2 weeks, so we recommend setting these up now to ensure you’re set up for success once holiday traffic increases.
  • Did you know that 92% of first-time site visitors don’t convert? We have an excellent way to bring those shoppers back to your site and turn them into buyers, with Dynamic Remarketing. Dynamic Remarketing reminds your shoppers of the exact item(s) they previously viewed on your site. This is a great way to reengage with your shoppers and increase your conversions. Advertisers have seen great results with Dynamic Remarketing — during last year’s holiday season retail clients saw 30% higher CTRs, 38% lower CPA, and 72% higher conversion rates.
This holiday race is more uncertain than ever, so we hope these recipes and staples are instrumental in driving success for you this year. If you’d like to learn more, listen to our Retail Unwrapped webcast on demand or visit our new Retail Hub to see all the latest retail industry insights and resources. Make sure to start preparation early and, as with any holiday season, optimise your bids, budgets and keywords to stay competitive. Happy holidays!