• by Laurie Sullivan  @lauriesullivan, January 5, 2011

Online sales driven only by paid-search ads got a boost in December. Revenue rose 47% for PM Digital online retailers, compared with the year-ago month, according to the PM Digital Rewind Index, which measures monthly paid-search performance.

comScore Wednesday reported that retail ecommerce spending for the November-December 2010 holiday season reached $32.6 billion, up 12% compared with last year.

Cyber Monday, in aggregate, did not materialize as the most profitable online sales day for PM Digital clients, although some did experience higher growth. For apparel clients, the average order value grew 5%. Green Monday was the top overall day for both revenue and order volume in December, but sales slowed shortly after as Christmas neared and shipping deadlines passed.

Paid-search spend rose 81% for the month compared with the prior year, partly as a result of rising costs reflected in the 22% increase in cost per clicks (CPCs).

The number of clicks for the month rose 42% and same-day conversion rose 7%, compared with the same month in the prior year. And while the CPC rose, in many cases higher costs accompanied better average order values (AOV). Some PM Digital clients saw AOV increase by 5%, but the average uptick in aggregate for retailers participating in the study was 2%.

Monday, Dec. 6 not only turned into a top day for clicks, but also year-on-year growth that came in notably better than the month's average. The biggest growth story for December clicks, however, is about Christmas and the following day. Both days saw clicks more than double the monthly average. With consumers now being trained to look for previews and sneak peeks of after Christmas sales, marketers can expect to see a continuing trend.

Suzy Sandberg, PM Digital CEO, says the one optimization strategy -- Google product ads -- that the company hoped would generate higher returns did not. Google talked up the tool as having the ability to produce similar results to Site Link, but the strategy turned out to be "a dud." Google still has work to do before the product ads can start generating significant revenue, she says.

Google launched them too late in the year and some clients got a lot of volume, while others experienced little, Sandberg says.

While the product ads didn't measure up, geotargeting did. "It turned out to be the biggest optimization strategy we did this year that we didn't do in prior years," Sandberg says. "It worked out very well."

PM Digital took underperforming keywords and ran them in areas that were predominantly strong for specific clients. Search marketers at the company also ran a list of historic top-shopping days building client-specific indexes. This enabled marketers to capture as many impressions available and better compete against others bidding on the same keyword.

"Since the 2009 and 2010 calendar year days fell on the same days, we artificially inflated the bids or took them down based on how orders came in during 2009," Sandberg explains.