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SEM for Those You Know and Those You Don’t

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Avinash Kaushik has a thought-provoking post on how to optimize your search marketing budget. He is right on in his assertion that most search marketing programs are far too heavily skewed to popular brand keywords—the words people who already know you use.

Avinash contends that if you analyze the return on your investment, you’ll find that the lesser-used terms (the "tail" keywords in Chris Anderson-speak) are bringing back far more money than the popular keywords. And he’s right.

Most search marketers can drive more sales with the same budget they expend now by focusing on the less-popular terms. Avinash outlines a radical proposal to split the purposes of organic and paid search marketing—to use organic search campaigns for the popular terms and the paid search budget for the long tail.

I think there are some exceptions to Avinash’s advice because sometimes highly-specific phrases sometimes convert highly and have been discovered by several businesses. (Think about very specific local search terms such as "Kalamazoo plumber"—it may not be that heavily searched, but if several of that city’s plumbers have found that the term converts, it might end up being more expensive than the average tail term.)

But despite exceptions in pathological cases, I believe that Avinash’s advice is worth exploring for any business. Too often, businesses buy terms without analyzing whether changing their mix could raise their return on investment. But I think if search marketers analyze their results by the numbers that they might not end up with as radical a strategy as Avinash suggests.

Paid search can be analyzed for return on investment using profits or lifetime value, as I have suggested in the past. But you also need to account for the synergy between organic and paid search. I frankly admit that I don’t know how to do that mathematically, but many have reported that traffic is far higher when a company controls a high ranking in both organic and paid search for the same term. Outrider’s Chris Copeland has reported research that shows a 92% click rate in such situations and has theorized that it is based on people developing a trust in anything found by both types of search. Regardless of the reason, I think we need to account for this synergy when we plan our campaigns.

In addition, I think that organic search marketing has far more value for the tail terms than Avinash gives it credit for. Most companies, in my experience, focus almost exclusively on product-oriented, catalog-type content that brings in the popular terms. They fail to offer the problem-oriented content that attracts people that don’t know what they want to buy yet.

For example, many potential customers are searching for "credit card fraud" that do not know they need a "data mining" system. If you focus your content only on explaining your solution to the problem, you may be surprised how little you use the term "credit card fraud"—you won’t use it in the title, for example.

If instead, you focus on writing several stories about the problem of credit card fraud—what it costs, what its causes are, how you can detect it, what kinds of solutions there are, etc.—then you’ll attract all those problem solvers out there who don’t yet know they need data mining software. And you can subtly explain that to them and maybe sell something.

So, I generally agree with Avinash’s points in that he challenges search marketers to examine more carefully the behaviors they’ve fallen into. You can’t focus most of your paid search budget on popular terms and expect to have the best return on investment possible. Trying Avinash’s advice is a good way to kickstart your thinking with something new.

But my suspicion is that most businesses will find that they still want to use paid search for some popular terms because of that click rate synergy that Chris Copeland studied. And I also suspect that marketers that carefully craft low-cost organic content aimed at early sales cycle customers will find that organic search works very well for the long tail.

These are mere quibbles with an excellent post by Avinash, however. If his thought-provoking ideas cause you to take a fresh look at your search marketing program, then it has done its job. I think that if you try his ideas and keep experimenting, you’re likely to end up with a somewhat less radical approach than he suggests. But Avinash would be the first one to agree that you always end up optimizing based on real numbers.

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