Kevin Stecko is the founder and president of  He's been operating the business since December of 1999.

Know Your Competition's Motivation

Google PLAs (Product Listing Ads) for my industry seem to be a playground for people who either make bad decisions unknowingly or make bad decisions intentionally.  The unintentional bad decisions are easy to explain because much of the bidding is automated and bundled up inside a larger campaign.  Lots of merchants aren't doing smart filtering of their data feed, either. It's easy for a company to end up bidding $1 on a product that is on clearance for $5.  There is literally no way to make money at those levels unless your conversion rate is 100% and the transactional fees and COGS stay under $4.00.  Not bloody likely.

I was surprised to see that Kohl's was recently showing up for a $4.99 t-shirt on a fairly broad keyword that probably sets them back at least $1 if someone bids on it.  My first instinct was that this was probably an unintentional bad decision.  But as I thought about it more I'm not so sure.  There is a desperation around ecommerce for traditional retailers.  They sat idly by as Amazon used an incredibly high stock price to fund decisions that could only be labeled as short term profit killers but long term customer habit builders.  Amazon now accounts for 55% of all ecommerce searches according to some statistic that I don't feel like finding to cite.  

So it's possible, and I am convinced now even likely, that Kohl's is intentional about this bidding strategy.  I've seen similar aggressive bidding from Wal-Mart, and the acquisition proves they are desperate not to cede ecommerce to Amazon.  So now that I know this what strategic direction should I take?  I can tell you that my spend on google is super conservative.  We are essentially bottom feeders that only show up when Google can't find ways to charge these desperate bidders way more than I'm willing to pay.  

The VERY STRONG Case For Lower Volume and Higher Prices

Gross Margin Can Be VERY Misleading