As the holiday season approaches, search remains one of the few places retailers can compete for attention with Amazon. Two out of three consumers start product search on a specific e-tailer site, and half of Big Box retailers’ site traffic comes from search.

However, while many retailers outperform Amazon in organic search visibility, the e-commerce giant’s paid search supremacy creates a major challenge. L2’s Insight Report: Big Box Black Friday finds that Amazon dominated three of the four top holiday categories in paid search visibility over Thanksgiving weekend, surpassing the most popular retailers in those categories.

For example, Toys “R” Us dominated the Toys & Baby category in organic visibility. But in paid search, the brand fell to fourth place; Amazon held the top spot, followed by fellow giants Target and Walmart. Similarly, category specialist buybuy BABY held fifth place in organic visibility but tumbled to thirteenth in paid search.

Frequency of First-Page Google Search Ads on Toys & Baby Category Terms, by Retailer

This decline in visibility resulted from category specialists being outmaneuvered by larger players like Amazon and Walmart. On Cyber Monday, Amazon ads appeared on 46.9% of 113 relevant keywords (i.e. “Kids toys”), while Toys “R” Us ads appeared on only 13.3%. To compete with Amazon, retailers need to rethink their paid search budgets.

This requires both vigilance and flexibility: brands need to rigorously monitor and respond to changes in paid search performance, especially during competitive holiday shopping periods when top visibility can disappear overnight. At the same time, brands should prepare for volatility by building flexibility into their search cost-per-click parameters and overall budgets in advance.


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