SEM is on The Verge of a Paradigm Shift

    February 27, 2007

There’s been a lot of soul-searching that’s been going on in the world of SEM lately and it’s good for everybody. Some of this introspection has doubtless been stimulated by the comments of my boss, Dave Pasternack, when he noted that "SEO is Not Rocket Science," but as pointed out by others, including Danny Sullivan and Gord Hotchkiss, both the SEO and Paid Search components of what we call SEM are on the cusp of a paradigm change.

This paradigm change is being driven by the economics of the search engines, which are engaged in a battle for market supremacy. To date, Google has been best at squeezing every possible penny from its clicks, but Yahoo and MSN are not far behind. Every possible weapon will be used in this battle, and one of the greatest, least utilized weapons possessed by each engine lies in its terabytes of data relating to user search behavior profiles.

Search profiles, assembled using the click-behavior of millions of users give the engines a a way to match searchers and advertisers that is light years beyond the capability offered by keywords. Engines can essentially offer marketers a way to pre-qualify customers that creates less waste and more value. Marketers will be able to bid more aggressively to reach potential customers whose historical behavior indicates a high chance of being in-market for a given product or service. Users, whose SERPs will present results, both organic and paid, which reflect one’s profile-indicated preferences, will have a better user experience.

So everybody wins, except, perhaps for SEM practitioners whose traditional definition of success, both in the paid and organic arenas, remains on selling services based on SERP position. These practitioners will no longer able to charge on the basis of position alone, but must begin to think about what they are actually offering their clients in terms of reaching each’s target audience. This is, in my view, a very healthy trend: even today, we see marketers obsessed with achieving top ranks, without considering the question which personalized SERPS impose: top rank for which audience group?

Some SEO’s seem to regard the advent of personalized SERPs as an apocalyptic event, because it so complicates their position-focused sales pitch. Those SEO’s whose service offering essentially consists of tactics meant to "add relevancy" for clients who really have no business achieving high (albeit irrelevant) rankings on SERPS certainly do have something to fear, because the search engines, armed with billions in cash, are going to use personalization as an additional filter to weed out irrelevant results.

But there is no reason why the advent of personalized search should trouble ethical SEO practitioners, because the thrust of personalized results is increased, not decreased relevancy. Marketers who have practiced the ethos of relevance in terms of designing information-rich, engaging websites will have nothing to fear from the rise of personalized search: in fact, they should welcome it, because it further separates the "signal" from the "noise" in the search channel. The same is true for marketers using PPC, because personalization provides a better shield against wasteful, non-converting clicks.

Someday, we may all look back on the era of today, in which search engines served up "one SERP fits all"-style pages and laugh at how clumsy and irrelevant such results were, and how imprecise today’s targeting tools are. If the recent moves of Google, Yahoo, and MSN are any indication, that day might occur sooner than many anticipate.


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