John Lewis spends nearly £1m on search ads to keep Argos and Amazon at bay

by Jennifer Faull, The Drum

John Lewis has invested heavily in edging ahead of its rivals when it comes to the competitive home décor sector, spending just shy of £1m on non-branded search terms last year – more than Amazon, Argos, and M&S.

Some £45.5m was spent by 4,892 advertisers on 500 non-branded home décor keywords in 2015, according to Kantar Media company AdGooroo. But it was John Lewis’ £920,000 spend that gave rise to it being named the biggest UK paid search advertiser in the sector.

The top five keywords were ‘fitted wardrobes’, ‘blinds’, ‘kitchens’, ‘sofas’ and ‘beds’, with the top two each attracting more than £1m of spend.

After John Lewis, Argos (£884,000), online giant Amazon (£867,000), window blind retailer Hillarys (£829,000) and US furniture retailer Wayfair (£804,000) invested most in paid search advertising on the keyword group. M&S – which has struggled with growing its non-food sales – spent just £656,000.

But although John Lewis spent the most on the keywords, the AdGooroo data revealed that Amazon attracted the most clicks. Its campaign drove more than two million clicks during the year, compared with John Lewis’ 1.99 million.

“Our findings demonstrate that retailers need to have a strong understanding of the competitive landscape in paid search,” said Richard Stokes, chief executive, AdGooroo.

"The home décor sector is especially competitive; on average, we found there were 93 advertisers actively sponsoring each of the top 20 keywords during the period. Our study also highlights the importance of keyword selection.

"For example, advertisers who sponsored the term ‘built in wardrobes’ but not the very similar term ‘fitted wardrobes’ may have missed out; ’fitted wardrobes‘ topped the list with £1m paid search spend and 460,000 clicks, while ‘built in wardrobes’ ranked all the way down at 19th, attracting only £399 in spend and 199,000 clicks.”

For John Lewis, the seven-figure spend seems to be paying off; its online sales continue to grow while click-and-collect orders grew by 11 per cent last year to now account for more than half of online orders. Meanwhile, sales in its Home department were up by over four per cent for 2015.

Overall, paid for search still accounts for the majority of all digital spend growing 15.3 per cent during the period to hit £4.36bn. The Drum recently revealed the short-list for its Search Awards, with Starcom Mediavest Group and Mediacom leading the nominations.

View the original article from The Drum

View the full U.K. Home Décor analysis from AdGooroo


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