July 2007 - Online Strategies

Staying Ahead of the Search Curve

By Aaron Kahlow

As we all know, search engine marketing provides the highest return on investment for the marketing dollar-when properly executed. Search might entail optimizing your site for top “natural” listings in the major search engines or building a detailed paid search campaign to have your company found in the paid listings of MSN, Yahoo, Google, etc. So, for those “in the know,” know that it’s no longer a question of whether you should seriously invest in both organic and paid search, it’s more a matter of how to outpace your competition in what is now a hyper-competitive space.

To stay ahead of your competition, you need better information, which requires analyzing the trends that will set the pace for the next three years, not just the next three months, because you need to be in the game for the long term and not merely the quick hit.

For many of us marketers, it’s easier to consider paid search as a campaign we’ve added to our budgets and organic search as something that our IT team or webmaster handles. It just makes our lives easier. But the major flaw in such an approach is that organic and paid search are integrally intertwined. Moreover, search has a major impact on all your marketing efforts.

Whether you’re a marketer or an agency, when you run a paid search campaign, you’re typically looking for click-throughs, lead generation and sales. Campaigns are tweaked based on click-through rates, lead generation per key word phrases (KWPs) and actual dollars coming from that search. Then, on the organic side, we ask our IT folks and search agencies to tweak the website to yield top rankings. And success is measured, more or less, on obtaining those rankings. So, two different sets of success criteria-or key performance indicators (KPIs), as we like to call them-and two different mindsets evolve, neither of which truly gives a marketer the full picture.

The more forward-thinking marketers are looking beyond these basic KPIs to get a true sense of how their search efforts are affecting their business. They are looking at the buying life cycle, engagement rates, brand equity and offline integration-determining how search affects their entire marketing strategy, and not merely as it exists as a campaign. So, let’s look at the top 3 KPIs that drive success.

When we look at the research on how customers purchase online (and off), there are a few glaring areas that stand out from the rest.

The more specific the KWP, the more serious the intent to purchase. For example, if I type “Plasma TV” into Google, I am most likely in the research phase of my buying cycle. Now, if I entered “52-inch Sony Plasma LCD,” I am much further along in the sales process. Finally, if I type in “best price on Sony Plasma LCDs,” I am assuredly looking to find a good deal. This is no different than our traditional buying cycle where any salesperson will tell you that someone who knows what they want and asks about price is the most likely to buy. It’s the “looky-loos” that drive us all crazy-and there are plenty of those online.

Looking back to our KPIs, if we evaluated “Plasma TV” in our paid search campaign and saw we had 10,000 click-throughs last quarter and then looked back at our “Sony Plasma LCD” KWP success and saw only 1,400, we might believe that Plasma TV is more effective. If we had a little more patience, we’d look at how the campaign led to actual inquiries or sales, and likely find that the click-to-sale rate is much higher with the more descriptive KWP.

So, which campaign is more successful? Many on the sales side would point to the 1,400 with a higher conversion rate. Brand marketers would prefer “Plasma TV” because of the awareness and brand leadership it drives. And in the end, both are right. So what it comes down to is how well these campaigns are aligned with your overall marketing objectives. Are you looking for greater marketplace awareness and being known for a certain product or are you more concerned about sales? For most, it’s a combination of both, which necessitates an analysis of long-term metrics; we might find that “Plasma TVs” drives more sales if we look beyond the initial intent to purchase.

KPI’s like engagement rate help us understand how well the site/landing page engaged the potential customer at that point in the buying cycle. A customer’s lifetime value can reveal how often a customer returns for other similar purchases even if a sale did not happen at that particular point in the search. Lastly, we have brand awareness. Is your brand associated as a leader in a particular category? Being atop major search engines organically has been proven to establish a much higher association-Google essentially validates your leadership status.

Traditional marketing mindsets still plague the online space. Marketers are not to be blamed-so many of us have been educated or have come up through the ranks with the traditional fundamentals. For example, more than 70 percent of our search budgets are spent on paid search, but less than 28 percent of our customers use paid search over organic listings. Why? Well, paid search is easier to quantify, easier to understand and easier to measure; it’s very much like our paid placements in, say, a magazine where if we spend $10,000, we know we’ll get 100,000 people looking at our ad, based on readership. Instead, we need to start thinking about our budgets as it relates to customer preference and not what our agencies feel more comfortable with.

Start by planning your search campaigns in relation to your overarching marketing strategy and not as a one-off “silo” strategy. Spend the time to look at your customers’ buying behavior and the cycle within, and partition your search efforts into how you want to affect each stage. Finally, take a hard look at how you are managing your search efforts. A fresh look or new perspective cannot hurt-even if it just confirms that you are on the right track.

Aaron Kahlow is managing partner of BusinessOnLine, a complete website optimization company, and chair of the Online Marketing Summit (OMS) conference. For information on the OMS summer tour, please visit regional.onlinemarketingsummit.com. Kahlow can be reached via e-mail at [email protected].


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