Google (NASDAQ: GOOG) is testing a pilot program to help retailers understand if their online ads are driving in-store sales.
The online giant reportedly has six advertisers working with the pilot and is using data from Acxiom, DataLogix, LiveRamp and Epsilon, reports the Wall Street Journal.
The program is a Google AdWords feature called In-Store Attribution Transaction Reporting. When a customer makes a purchase in a retail store, Google can link the purchase back to cookies on that user's computer or mobile device, which are matched to anonymous Google click ID's. From there, Google can identify which online ads generated in-store sales and how much they generated. Information from loyalty cards and other marketing programs is also used to match ad consumption with brick-and-mortar purchases.
"We are running a number of tests to help clients use their own sales data to measure how their search campaigns impact sales," said a Google spokesman, reports the Journal.
Arts and crafts retailer Michaels was named as one of the six retailers participating in the pilot.
The data companies that have partnered with Google for the In-Store Attribution Transaction Reporting have been doing similar work with other online brands. Acxiom, for example, has worked with Yahoo (NASDAQ: YHOO), Microsoft (NASDAQ: MSFT) and AOL (NYSE: AOL) on tracking programs, reports the Journal. In March, Acxiom released the results of a study it conducted of banner-ad campaigns by more than 50 companies over roughly two years. The survey found, on average, online ads drove $9 of sales for every dollar spent primarily in physical stores.
The program could be a groundbreaking turning point in how retailers measure the effectiveness of online advertising. Merchants have historically spent more on television and other traditional media because they have not determined how to measure the impact of how digital ads influence consumers to shop, reported Google execs.
Google has been actively stepping up its involvement in the retail industry. Last month, Google announced that it would partner with the Luxottica Group, owner of the Sunglass Hut, Ray-Ban and Oakley sunglass brands and retail stores, to design and distribute a new kind of eyewear for Google Glass. The internet giant is also planning to open up its first-ever retail store in Manhattan's SoHo neighborhood.
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