The search for offline sales

Search has value across the cosumer decision journey. It can help shoppers learn about new products, compare options and find nearby stores.

With paid search in your marketing mix, you can help drive revenue - both online and offline - and deliver the right message to consumers as they're searching for your products or brand.

Executive summary

Search influences decisions at every stage of the consumer’s decision journey. When consumers go from inspiration to purchase, they depend on search engines to find and buy a product. But how does paid search affect purchases – in particular, brick-and-mortar purchases?

In late 2016, Microsoft worked with a nationwide department store chain in the US to understand how paid search campaigns impacted sales, both online and offline. Based on both the retailer’s in-store purchase data and their Bing Ads account data, the study examines how Bing Ads campaigns can drive in-store revenue and have a positive effect on offline return on ad spend (ROAS), especially during the holiday season.

This insight will help advertisers understand how consumers utilize search from initial consideration to purchase, and how to adjust the timing of search engine marketing (SEM) to maximize both offline and online revenue.

Key takeaways:

1. Bing Ads influence both online and offline purchases.
2. Non-brand ads and Bing Shopping Campaigns (BSC) have a larger impact on offline sales during the holidays.
3. Bing Ads have a higher offline return on ad spend (ROAS) during the holidays, for every ad type.
4. Offline conversion cycles are lengthier than online conversion cycles.

Non-brand ads and BSC have a larger impact on offline sales during the holidays.

In this study, we analyzed different Bing Ads ad types to understand their impact on online and offline revenue.

Brand campaigns often get the lion’s share of credit when measuring revenue impact, because last-click attribution models show branded keywords as the last-touch point prior to purchase. This leads advertisers to neglect their non-brand and shopping campaigns in favor of brand campaigns.

While Bing Ads brand campaigns may drive the most online and offline revenue, don’t discount the impact of category and shopping campaigns – especially during the holidays.

During the non-holiday time period, this retailer’s offline revenue contribution was 69% brand campaigns, 14% non-brand, and 17% Bing Shopping Campaigns (BSC), while online revenue contribution was weighted even more toward brand campaigns, with 79% brand, 10% non-brand, and 11% BSC.

For the holiday period, we see a shift in revenue drivers in favor of non-brand and BSC. This retailer now sees 54% brand, 26% non-brand, and 20% BSC for offline revenue contribution, and 68% brand, 19% non-brand, and 13% Bing Shopping Campaigns  for online revenue contribution.

In conclusion, while non-brand and Bing Shopping Campaigns are always an important component to paid search campaigns, their impact rises 48% for offline and 52% for online revenue during the holidays.

Offline and online revenue contribution by ad type

Bing Ads have a higher offline ROAS during the holidays, for every ad type.

Offline return on ad spend during the holidays compared to before the holiday season.

Offline ROAS improved during the holidays, especially for shopping and non-brand campaigns. During the holidays, offline ROAS improved by 2% for brand campaigns, 38% for non-brand campaigns, and 34% for Bing Shopping Campaigns compared to pre-holiday levels.

Advertisers can expect a revenue boost in their holiday paid search campaigns with Bing Ads, as their customers journey from the search engine results page (SERP) to their physical stores more often during the holidays than they did earlier in the year.

Offline conversion cycles are lengthier than online conversion cycles.

The majority of online sales occur within the first week of the click. But offline sales follow  a longer process. In mapping purchases against their last Bing Ads interaction, we see that 66% of offline purchases happen 2-4 weeks after the click.

For advertisers, this means that in order to make the most of the holiday season, paid search campaigns need to be live in October, at least 4 weeks ahead of key dates like Black Friday and Cyber Monday. But they shouldn’t expect an immediate return on ad spend.

For the 34% of in-store customers who purchase within the first week of a click, it’s important to keep paid search campaigns running up past last final shipping deadlines, especially as we see that in-store purchases begin to overtake online purchases as early as the first week of December and grow steadily until Christmas.

Significantly, the study shows that Bing Ads has a considerable impact on offline post-Christmas purchases, relative to online.