Paid search is one of the most competitive and tightly managed digital marketplaces that exists today. Yet in this world where daily micro-management of tens of thousands of keywords has become the norm, one of the simplest and most powerful strategies is often overlooked or underutilized. As we previously observed in a study for display media1, online conversion rates differ greatly by time of day, and choosing to advertise at certain hours over others can greatly improve performance and reduce cost-per-acquisition and waste. Sponsored search is an ideal channel for advertisers to take advantage of fluctuating conversion rates throughout the day. In this Digital Insight report, we present aggregated industry conversion rates by hour for sponsored search listings, along with a more detailed look at some of the web’s top industry categories.
Sponsored search marketers can realize performance gains by managing their keyword bids by daypart. By reducing their bids at poorly performing hours and reallocating those funds to hours with better conversion rates, advertisers can expect to see greater conversion volumes and better returns on advertising spend. You should be willing to bid higher to gain volumes at these hours, but generally if the cost is 30 percent or more than what you would normally bid, the cost will outweigh the benefit and result in a net loss in performance.
Daypart performance can vary greatly by advertiser and vertical. Additionally, the trends shown in this study may vary by day of week and could show different patterns for weekends versus weekdays. Any marketer making a significant investment in sponsored search should analyze the daypart behavior of their campaigns to best take advantage of this strategic optimization opportunity. By leveraging bid management tools that enable custom bidding rules throughout the day, these insights become actionable and represent some of the lowest hanging fruit in a highly competitive market.
Microsoft Advertising Institute publishes Digital Marketing Insights (DMIs), a series of publications by digital marketing experts that help our customers improve their digital marketing effectiveness. Many of these findings are also made available to the digital marketing industry at large. Each DMI is designed to help marketers more successfully build value with their customers, throughout the customer lifecycle: from awareness to acquisition and from retention to growth. Microsoft Advertising Institute also provides education in digital marketing to Microsoft customers. Learn more about Microsoft Advertising Institute.
Download the complete Digital Marketing Insight report to learn more about research findings and key takeaways.
