Integrating Keyword Segmentation and Budget Allocation Decisions in Sponsored Search Advertising

Budget constrained sponsored search advertisers must decide how to allocate their advertisement budget across ad campaigns and individual keywords. In this paper, a simulation model that integrates the complex issues involved in keyword segmentation and campaign organization is used to evaluate performance of various budget allocation strategies. Using the buying funnel model as the basis for keyword segmentation and campaign organization, we analyze Volume-based, Cost-based, and Clicks-based budget allocation strategies and evaluate their performance implications for different firms. The simulation model is empirically evaluated using four Fortune 500 companies and their keyword data obtained from a leading provider of keyword research technology. The results and statistical analyses show significant improvements in budget utilization using the proposed allocation strategies over a Baseline commonly used in practice. The study offers useful insights into the budget allocation problem by leveraging a theoretical framework for keyword segmentation and campaign management.

Frontiers: Moment Marketing: Measuring Dynamics in Cross-Channel Ad Effectiveness

This paper provides the first empirical evidence on whether and why TV-moment-based search advertising could be effective for optimizing sponsored search advertising for both TV-advertised brands and their competitors.

The Effects of Search Advertising on Competitors: An Experiment Before a Merger

We report the results of an experiment in which a company, Firm Vary, temporarily suspended its sponsored search advertising campaign on Google in randomly selected advertising markets in the United States. By shutting off its ads, Firm Vary lost customers, but only 63% as many as a nonexperimental estimate would have suggested. Following the experiment, Firm Vary merged with its closest competitor, Firm Fixed. Using combined data from both companies, the experiment revealed that spillover effects of Firm Vary’s search advertising on Firm Fixed’s business and its marketing campaigns were surprisingly small, even in the market for Firm Vary’s brand name as a keyword search term, where the two firms were effectively duopsonists. This paper was accepted by Eric Anderson, marketing.