Current research on paid search highlights its ability to enhance online as well as offline conversions. Yet, research investigating the impact of placing paid search ads on less prominent positions on subsequent consumer behavior is limited to the online environment. This paper presents a controlled field experiment which investigates whether the targeting of a less prominent ad position can be beneficial for bricks-and-mortar retailers who sell their products via local stores. Preliminary Results indicate that paid search advertising budgets could be allocated more efficiently by targeting less prominent ad positions, thus allowing a bricks-and-mortar retailer with a limited marketing budget to increase the reach of their marketing campaign, attract more consumers to its website and achieve an overall in-crease in conversions. These findings illustrate that search theory continues to apply in the realm of paid search and that different consumer types are likely to click on differently positioned ads. Advertisers could leverage this behavior to reach preferred types of customers by targeting specific ad positions. Bricks-and-mortar retailers could consider targeting less prominent ad positions when seeking to reduce advertising costs while simultaneously extending their reach to customers and achieve an increase in conversions.
Schlangenotto, Darius and Kundisch, Dennis, (2017). "ACHIEVING MORE BY PAYING LESS? HOW RETAILERS CAN BENEFIT BY BIDDING LESS AGGRESSIVELY IN PAID SEARCH AUCTIONS". In Proceedings of the 25th European Conference on Information Systems (ECIS), Guimarães, Portugal, June 5-10, 2017 (pp. 2689-2698). ISBN 978-0-9915567-0-0 Research-in-Progress Papers.