Welcome to Nerd Alert, a series of special episodes bridging the gap between marketing academia and practitioners. We’re breaking down highly involved, complex research into plain language and takeaways any marketer can use.

In this episode, Elena and Rob explore a large-scale eBay experiment that challenges common assumptions about paid search advertising effectiveness. They discover that brand-keyword ads often reach customers who would have found the site anyway, and even non-branded keywords generate negative ROI.

Topics covered:

• [01:00] "Consumer Heterogeneity and Paid Search Effectiveness: A Large Scale Field Experiment"
• [02:35] Why marketers avoid clicking paid search ads
• [03:45] eBay's massive experiment design
• [06:00] The surprising impact on frequent buyers
• [07:10] Shocking ROI results
• [08:30] What this means for established brands 

 





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Resources: 
Blake, T., Nosko, C., & Tadelis, S. (2014). Consumer Heterogeneity and Paid Search Effectiveness: A Large-Scale Field Experiment. Econometrica.  


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