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Nov 20, 2006
Blog Post

EBay's VP Search Marketing Reveals Bidding Strategies & Top Concerns

SUMMARY: No summary available.
By Anne Holland, President

Last week while I was in San Francisco for our B-to-B Summit, I also grabbed the chance to talk with Matt Ackley, eBay's VP of Net Marketing. I met Matt at a NorCal BMA luncheon. He's funny, honest and smart -- especially about search marketing.

Here are highlights of what I learned from him:

o Why eBay buys the keyword 'eBay'

"We actually buy the word 'eBay,' which is very, very unintuitive. We've done numerous, numerous tests on this, because every time I go and say, 'We buy the keyword, eBay', people come back and say, 'You're an idiot. Why are you buying the keyword eBay? Everybody knows eBay. You don't need to buy the keyword eBay.'

"We have proven this through analytics ... over and over again that it is actually incremental to buy the keyword eBay.

"The reason we believe it is such that there are different types of users ... [who] use search in different ways. ... There's probably users who essentially, we say, 'Put their faith in Google. In Google we trust, and I'm just going to click on the organic search results because I trust the Google algorithm.' Then, there's the group of users who say, 'You know what? If somebody's willing to pay for something, they've probably got something of quality to sell."

"So, we've seen that by buying keyword eBay, we actually get incremental traffic. Now, of course, we cannibalize the natural search or the organic search results. We're paying for traffic that supposedly we would have gotten for free, and that's always the question internally, 'Why are you doing this?' But, we've run the data over and over again."

o Google's One-Box presents new challenges

Matt agreed that, as Sherpa's Search Benchmark Guide 2007 revealed, the fairly new Google One-Box (bulleted links often presented in the first organic search display) is presenting a considerable SEM challenge.

"Our site name is the same as our [stock] ticker symbol -- so when you do a search on eBay, actually, the ticker symbol and quote comes up at the top of the natural search listings, which effectively drops our first organic result down to what would be like the third position. ... I went to the CEO at one point and said, 'You know we could probably save a ton of money if you changed the ticker symbol.' That didn't go over too well."

o Why eBay buys weird terms (a.k.a. 'eBads')

Ackley noted there are several independent Web sites and blogs dedicated to tracking so-called 'eBads' -- Google ads bought by eBay under terms no one would reasonably think could sell a darn thing. Terms such as 'hole in the head' and 'dung' for example.

He explained his team has a database of 250 million possible keyterms to runs ads under -- and generally they're running campaigns for five to 15 million of these. To make this possible, everything is automated and analyzed like crazy.

"We evaluate whether we think that keyword is going to make us any money or not, and then we go out and we buy it on Google at the minimum CPC, which is often a penny."

Also, Google themselves sometimes complains about some of the terms -- so eBay has to prove they're relevant. In the case of "dung," it turns out there's quite a bit of dinosaur dung being bid on at the moment.

o Improving search conversions

You can't convert high-end products on seller reputation alone. eBay finds the more expertise (factoids, content, reviews, detailed product guides, etc.) a listing has, the better the conversion rate.

o Biggest conversion ever

eBay sells more than $5 billion in B-to-B each year. Biggest item sold was a corporate jet for about $4.9 million. The buyers used PayPal because, as many B-to-B online buyers prefer, it allowed credit terms.

o SEO improvement Ackley would like to see for 2007

He wishes the internal PR department would get SEO religion and more rigorously optimize releases for more search traffic. Plus, more releases for the purposes of SEO would be great too.

Note: You can download an MP3 of my entire interview with Matt and our fellow panel members Dean DeBiase of Fathom Online and Jack Jia of Baynote over at NorCal BMA's site at:
http://www.norcalbma.org/programs/November-2006-meeting
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Comments about this Blog Entry

Feb 17, 2007 - online auctions of University of Miami says:
I am surprised that Ackley mentions that they test and retest everything many times, but he does not say that they were actually able to prove any of their hypothesis. I've been using reverse auction site http://www.oltiby.com for some time and I got items cheaper then what they would cost me at eBay.



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