Is Your Paid Search Campaign Cannibalizing Your Organic Clicks?

According to Google, 89% of Traffic from Ads Not Replaced by Organic

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Is Your Paid Search Campaign Cannibalizing Your Organic Clicks?
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In case you’re wondering if your paid campaigns are cannibalizing clicks from your organic search results, the answer is: not so much. That is If you take Google’s word for it anyway.

Google says its statisticians have run over 400 studies on accounts with paused paid search campaigns to gain some insight into how paid search affects organic clicks for websites.

“In what we call ‘Search Ads Pause Studies’, our group of researchers observed organic click volume in the absence of search ads,” Google’s Quantitative Management team said in a post on the Google Research Blog. “Then they built a statistical model to predict the click volume for given levels of ad spend using spend and organic impression volume as predictors. These models generated estimates for the incremental clicks attributable to search ads (IAC), or in other words, the percentage of paid clicks that are not made up for by organic clicks when search ads are paused.”

“The results were surprising,” the team added. “On average, the incremental ad clicks percentage across verticals is 89%. This means that a full 89% of the traffic generated by search ads is not replaced by organic clicks when ads are paused. This number was consistently high across verticals.”

Hmm. Sounds like you should really be spending money paying for Google ads…at least according to Google.

David X. Chan, Yuan Yuan, Jim Koehler, and Deepak Kumar explain in the report:

In order to determine the incremental clicks related to search advertising, we quantify the impact pausing search ad spend has on total clicks. Indirect navigation to the advertiser site is not considered. Each study produces an estimate of the incremental clicks attributed to search advertising for an advertiser. To make comparison across multiple studies easier, we express the incremental clicks as a percentage of the change in paid clicks. This metric is labeled \Incremental Ad Clicks”, or \IAC” for short.

IAC represents the percentage of paid clicks that are not made up for by organic clicks when ads are paused. Conversely, when the campaign is restarted, the IAC represents the fraction of paid clicks that are incremental. Since we do not assume a positive interaction between paid and organic search in our analysis, the IAC estimate is bounded at 100%.

The team does acknowledge that it has not conducted enough studies to determine the impact of seasonality on the results.

The full report can be read here (pdf).

Is Your Paid Search Campaign Cannibalizing Your Organic Clicks?
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  • http://www.morehairextensions.com Jay

    It’s a little too convenient for Google to say that PPC ads are not cannibalizing clicks that a site would have otherwise gotten organically, when the only “data’ they use is from customers who already have their ads paused anyways, likely for different reasons. Especially in situations where brands have to pay for PPC ads on their own brand names, even when they rank first organically, and nearly half of the searchers for that brand click on the paid instead of “free” result, it’s hard to believe that only 11% of the clicks were different in Google’s “paused ad” tests.

  • http://www.firstaidglobal.com firstaidglobal

    I’m a bit confused by the details. Does this article indicate that the act of pausing google ads hurts my company’s search returns compared to what i could expect before using google ads?

  • http://mishemorroides.blogspot.com Jos

    I think that Google does not tell the truth because if so they will lose money…

  • http://www.slideshare.net/selecto1/campanas-para-cocina Jos

    Yep, i´m also a bit confused, but Indirect navigation to the advertiser site is not considered.

  • http://www.ingroundsafetyshelter.com BenFranklin

    I wouldn’t have expected google to come out and say running google ads hurt your organic results… but I still say organic results get better sales!

  • http://www.searchtechnologies.nl Niels

    What happened to make you all so cynical :-). We did a similar test a few weeks ago with similar findings. In one case we had been advertising on the premium position 1 for months. Then out of nowhere (sort of) we got the organic number 1 position. We also had data for the amount of traffic the organic number 1 spot got in the past.

    What we found is that ad-traffic hardly decreased but also that organic traffic levels remained in line with the historical data. In this case with there was hardly any canibalization.
    Now we have paused the ad and we’ll see if organic traffic grows…

  • Chris G

    They say organic rank is not in the calculations. Well, duh, you’ll get more traffic if you place an ad for search terms where you are not already in the organic results. This is news?

    It would be nice to see somebody address the incrementals of paid search when you’re already #1 organically. That is NOT what this study is about, folks.

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