Background

DustBunny Vacuums markets their products in a number of ways. One of the most important of these, particularly since DBVac is a direct-to-consumer company, is online keyword advertising. Before completing this part of the assignment, familiarize yourself with the details given below. Youll need to refer back to this background content to respond to requirements given in this part of the assignment.

Have you ever noticed when you conduct a Google search that the top results are advertisements? These ads are keyword ads, the specific ads that appear were triggered by the search terms (keywords) you used for your search. Heres a (simplified) view of a Google search results page, diagrammed to show what the different elements are:

Since they show up as the first results and are typically well-suited to what the user is searching for, these keyword advertisements can be very effective at driving traffic (and, hopefully, sales) to the advertisers website. The advertiser then pays Google whenever a user clicks on the advertisers ad.

When an advertiser such as DBVac wants to place a keyword advertisement, they need to provide Google three basic things: (1) the search term (or set of search terms) for which they want their advertisement to show up; (2) the advertisement that should be shown when a user searches for those terms; and (3) the maximum that the advertiser is willing to pay for a click the advertisements ranking (i.e., whether it shows up at the very top of the page or is instead showed in one of the lower positions) is determined, in part, by this maximum amount.

In addition, the advertiser can submit several different advertisements, called ad creatives, that Google will then show in some sort of rotation such that each of these submitted creatives gets used. Many advertisers, including DBVac, use this function to test several different ad creatives for a short period to see which one is most effective before then using the best of those creatives for a longer period. In other words, the advertiser might test 10 different creatives for a week, look at how each of the 10 performed, then use the one with the best performance for the next three months of the advertising campaign.

Within Google AdWords, creatives consist of the following:

Headline 1 (H1) A 30-character headline that is included as part of the link to the destination website.

Headline 2 (H2) Another 30-character headline, also included as part of the link to the destination website. Within a Google search results page, the content of Headline 1 and Headline 2 is usually separated with a | (pipe character).

Description (D) A 90-character description.

When testing advertising creatives, companies create different ads by varying the content of these three components (H1, H2, D).

Further, to assess the performance of different ad creatives, advertisers look at a variety of different performance metrics. For DBVac, the metrics that they consider when doing these evaluations include:

Impressions (Imps) This term refers to the number of times that a given ad was shown by Google (i.e., the number of times the ad came up as a result of someone conducting a search).

Clicks The number of times that a user clicked on the advertisement (and, thus, was taken to DBVacs website).

Click-Thru-Rate (CTR) The number of clicks divided by the number of impressions, indicates the rate at which users clicked DBVacs ad.

Cost The total cost incurred by DBVac (because users clicked on the ad).

Cost-per-Click (CPC) The average cost for each time the user clicked on one of DBVacs ads; equal to the Cost divided by Clicks.

Conversions (Conv.) The number of times that a user who clicked on an ad made a purchase during the ensuing visit.

Conversion Rate (CRate) The rate of conversion (conversion = purchase) among those who clicked on the ad; equal to the Conversions divided by Clicks.

Revenue (Rev) The total revenue generated during the ensuing visits of those users.

Average Cart Value (ACV) The average sale value among those sales generated by users who clicked on the ad; equals Revenue divided by Conversions.

Revenue per Dollar Spent (Rev/$) How much revenue was generated per dollar spent on clicks; equals Revenue divided by Cost.

When testing a number of ad creatives, then, DBVac will collect these data points for the period of the test for each of the ad creatives, then compare the data generated by each creative to make their determination as to which performed the best and should therefore be used for the full campaign.

One more important note: keyword advertisements can be geographically targeted. The advertiser can choose for one ad to be used for a certain geography (e.g., a given state, county, or set of zip codes) and another for a different geography.

Recently, DustBunny Vacuums conducted a week-long test using Google AdWords. During the test, they used the following eight ad creatives to determine which was most effective at driving revenue through the companys website. For each of the eight (labeled Ad A through Ad H), H1, H2, and D are shown.

Ad A

H1: DustBunny Vacuums

H2: Shop now and save money!

D: We only sell our vacuums direct that means you get a better product for less money.

Ad B

H1: Your life is a dirt pile. We can help.

H2: Buy direct from DBVac and save!

D: Overwhelmed by housework? Give yourself a break and put our robo-vac to work!

Ad C

H1: Clean less, family more

H2: DustBunny robots clean it all

D: Overwhelmed by housework? Create more family time by putting our robo-vac to work!

Ad D

H1: Cats love riding robo-vacuums!

H2: Check out our cat & dog videos

D: DustBunnys robo-vacuums are great for pet owners they clean while they entertain!

Ad E

H1: Clean less, mellow out more

H2: DustBunny robots clean it all

D: Overwhelmed by housework? Give yourself a break and put our robo-vac to work!

Ad F

H1: DustBunny vacuums save the day

H2: Let our robots do all the work

D: Our vacuums never take a day off, never ask for a raise, and probably wont unionize soon!

Ad G

H1: Award-winning robot vacuums

H2: Buy direct from DBVac and save!

D: See our lineup of dazzling robot vacuums low emissions, high efficiency, easy-to-use!

Ad H

H1: Cleaner house in less time

H2: Our robots never go berserk

D: DBVac robots never take days off, never ask for a raise, and probably wont unionize soon!

At the end of the week, the test had generated the following results:

Use the background provided as well as the table of test results to respond to the following. When making calculations, feel free to use the Keyword Test Results.xls document and complete these using Excel (or other spreadsheet software).

Calculate descriptive statistics for clicks.(15 points total). Specifically, calculate: a. The count of creatives.

b. The mean number of clicks (to the nearest tenth) for the different creatives.

c. The median number of clicks for the different creatives.

d. The minimum number of clicks for the different creatives.

e. The maximum number of clicks for the different creatives.

f. The standard deviation of clicks for a creative.

AutoSave OFF Keyword Test Results-1 Insert Draw Page Layout Formulas Data Home - Review View Developer Share Comments X Calibri (Body) v 12 VA A a Wraa Text General 2 Insert Delete Format Pastc B 1 CA - - A Merge & Center S. % Cell Styles Conditional Format Formatting es Teble Sort X Filter Find & Select Ideas Sensitivity Check for Updates Office Update To keep up-to-date with security updates, fixes, and improvements, choose Check for Updates. B18 + fx A B D E F G H 1 J K Conv. 1 Ad 2 Ad A 3 Ad B 4 Ad C 5 Ad D 6 Ad E 7 Ad F 8 Ad G 9 Ad H 10 11 12 13 14 Imps Clicks CTR Cost 16120 130 0.81% $199.50 16525 242 1.46% $ 355.22 15593 149 0.96% $ 226.81 21028 681 3.24% $ 702.19 16088 114 0.71% $ 193.80 14110 120 0.85% $ 188.19 14825 144 0.97% $ 218.09 15327 158 1.03% $ 224.83 CPC $1.53 $1.47 $1.52 $1.03 $1.70 $1.57 $1.51 $1.42 CRate Rev ACV Rev/$ 4 3.1% $ 1,425 $ 356 $ 7.14 9 3.7% $ 2,440 $ 271 $ 6.87 7 4.7% $ 1,425 $ 204 $ 6.28 2 0.3% $ 379 $ 190 $ 0.54 3 2.6% $ 935 $ 312 $ 4.82 4 3.3% $ 1,195 $ 299 $ 6.35 4 2.8% $ 928 $ 232 $ 4.26 7 4.4% $ 1,980 $ 283 $ 8.81 15 16 Sheet1 2384