ACM SIGIR Forum
Bayesian Statistics and Marketing
Marketing Science
Modeling the Clickstream: Implications for Web-Based Advertising Efforts
Marketing Science
Dynamic Conversion Behavior at E-Commerce Sites
Management Science
INFORMS Journal on Computing
An empirical analysis of sponsored search performance in search engine advertising
WSDM '08 Proceedings of the 2008 International Conference on Web Search and Data Mining
Comparing performance metrics in organic search with sponsored search advertising
Proceedings of the 2nd International Workshop on Data Mining and Audience Intelligence for Advertising
Smart marketing or bait & switch: competitors' brands as keywords in online advertising
Proceedings of the 4th workshop on Information credibility
The Brand Effect of Key Phrases and Advertisements in Sponsored Search
International Journal of Electronic Commerce
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The phenomenon of sponsored search advertising is gaining ground as the largest source of revenues for search engines. Firms across different industries have are beginning to adopt this as the primary form of online advertising. This process works on an auction mechanism in which advertisers bid for different keywords, and final rank for a given keyword is allocated by the search engine. But how different are firm's actual bids from their optimal bids? Moreover, what are other ways in which firms can potentially benefit from sponsored search advertising? Based on the model and estimates from prior work [10], we conduct a number of policy simulations in order to investigate to what extent an advertiser can benefit from bidding optimally for its keywords. Further, we build a Hierarchical Bayesian modeling framework to explore the potential for cross-selling or spillovers effects from a given keyword advertisement across multiple product categories, and estimate the model using Markov Chain Monte Carlo (MCMC) methods. Our analysis suggests that advertisers are not bidding optimally with respect to maximizing profits. We conduct a detailed analysis with product level variables to explore the extent of cross-selling opportunities across different categories from a given keyword advertisement. We find that there exists significant potential for cross-selling through search keyword advertisements in that consumers often end up buying products from other categories in addition to the product they were searching for. Latency (the time it takes for consumer to place a purchase order after clicking on the advertisement) and the presence of a brand name in the keyword are associated with consumer spending on product categories that are different from the one they were originally searching for on the Internet.