CSE Holiday Rates

So in looking forward to Q4, the first thought that comes to mind circulates around holiday rate increases.

As usual for the 2008 holiday season, expect comparison shopping engines to temporarily raise CPC rates to make sure merchants share the wealth. Expect this to happen starting November 1st and lasting until December 31st. The key to the process is adjusting.

First, make sure you are ready to adjust any product or category level bids. Remember if you are bidding just a few pennies above minimums, and then minimums go up 20% in cost, then your bids will no longer be valid. Instead, you will be scrapping the bottom of product relevancy like merchants who never saw a bidding interface.

After adjusting bids, then make sure to monitor performance. Long before rate increases go into effect, traffic will begin to rise steadily. I suggest carefully monitoring items on a product by product basis to make sure costs are not scaling too far ahead of traffic and sales.

Next, relax. That’s right, relax! Too many merchants get too caught up in the ramp up to busy season, that they loose focus and act like they have had way too many coffees. The problem with that approach, besides alienating fellow co-workers and partners, is that you will miss the details. That’s right – you will be so wrapped up in revving your engine, you will not have the coherency to examine patterns in the right state of mind, so you can see the new opportunities as they emerge.

Lastly, plan for  Q1 2009. Remember this is an economy going through pain (see Lehman Brothers). Make sure you are accurately anticipating what the results will be at the end of 2008. If you had inflated figures compared to recent trends, then don’t be afraid to take that into account and set expectations now. Ecommerce is still growing, but not at a 25% clip anymore.

In planning for Q1, also remember to turn bids back to normal minimums in January. Many merchants don’t revert their bids back, and end up paying inflated seasonal costs because their CPC rates are still set at Q4 levels (no, most CSEs will not revert this back for you).

With that said, enjoy the next 2 weeks of relative sanity, ponder what Microsoft is going to do with the Ciao.com purchase (now that Jellyfish aka Cashback is getting it’s act together), and please do tell me what has happened to Google Product in the last few weeks. Geez…

September 14th, 2008