Preprint
How Search Engine Advertising Affects Sales over Time: An Empirical Investigation
ArXiv.org
08/15/2020
DOI: 10.48550/arxiv.2008.06809
Abstract
As a mainstream marketing channel on the Internet, Search Engine Advertising
(SEA) has a huge business impact and attracts a plethora of attention from both
academia and industry. One important goal of advertising is to increase sales.
Nevertheless, while previous research has studied multiple factors that are
potentially related to the outcome of SEA campaigns, effects of these factors
on actual sales generated by SEA remain understudied. It is also unclear
whether and how such effects change over time in highly dynamic SEA campaigns.
As the first empirical investigation of the dynamic advertisement-sales
relationship in SEA, this study builds an advertising response model within a
time-varying coefficient (TVC) modeling framework, and estimates the model
using a unique dataset from a large E-Commerce retailer in the United States.
Results reveal the effects of the advertising expenditure, consumer behaviors
and advertisement characteristics on realized sales, and demonstrate that such
effects on sales do change over time in non-linear ways. More importantly, we
find that carryover has a stronger effect in generating sales than direct
response does, conversion rate is much more important than click-through rate,
and ad position does not have significant effects on sales. These findings have
direct implications for advertisers to launch more effective SEA campaigns.
Details
- Title: Subtitle
- How Search Engine Advertising Affects Sales over Time: An Empirical Investigation
- Creators
- Yanwu YangKang ZhaoDaniel ZengBernard Jim Jansen
- Resource Type
- Preprint
- Publication Details
- ArXiv.org
- DOI
- 10.48550/arxiv.2008.06809
- ISSN
- 2331-8422
- Language
- English
- Date posted
- 08/15/2020
- Academic Unit
- Business Analytics
- Record Identifier
- 9984380728302771
Metrics
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