The Battle of PPC vs. SEM: Part 1 of 3
by Scott Gardner
Before you began using pay-per-click (PPC) advertising to drive
Search Engine traffic to your website, how often did you click
on the Paid or Sponsored Listings? Put yourself in the buyer's
shoes; clicking on the Sponsored Listings occurs probably 10-20%
of the time. More often than not, your targeted buyer will go
straight to the "true" search engine matches, where they can
find the most relevant websites out of thousands of millions
of page matches. Take an inter-office poll; ask your co-workers
to perform a search for an unrelated topic/product/service and
watch their click-thru trends. The majority of the time, they
will skip right over the paid results. On the other hand, YOU
will notice the Paid/Sponsored Listings because you know about
them and you spent a lot of company resources to put your
website there. The buyers who have no interest or stake in a
PPC campaign, just simply overlook these paid listings and are
conditioned, much like Pavlov's dogs, to go straight to the main
results.
Now time for the most important question of all: Where is your
site positioned in the main Search Engine results of Google,
Yahoo!, MSN, AOL and the other primary search engines that
receive 90% of all Search Engine traffic?
If your company is allocating a substantial portion of its
online marketing budget & efforts to the main PPC models, then
you seriously need to look into getting your website highly
positioned in the true search engine matches. There are only a
handful of established, reputable Search Engine Marketing (SEM)
companies that can deliver the results you need to dominate your
industry; which can yield greater profits than your PPC
campaigns. If you are tapping your monthly budgets and not
experiencing the ROI that you need from PPC, then it is time to
get your site firmly positioned in the main results of the
world's leading search engines and reach the majority of your
target audience, not the minority.
PPC models are excellent for short-term marketing campaigns. You
can adjust your bids and consequent Sponsored Listing positions
in real-time. I have clients who do both types of search engine
marketing. But when you compare apples to apples and oranges to
oranges, the problems that have slowly evolved with PPC are:
- Your top competitors determine the bids, forcing you to either
pay even more for each visitor or completely bail out of the
top 3 bids. If you do the latter, then your traffic is
significantly diminished; now what's your plan?.
- Paid Listings capture only a small percentage of total
Search Engine traffic as noted above. Wouldn't it make more
sense to target the majority?
- Many studies have shown that sales conversion rates are lower
in the PPC models; averaging about a 1% sales conversion rate
for the traffic received from these bid listings.
- It's a very time consuming process to constantly monitor your
bids, positions, and traffic. With Yahoo!'s acquisition of
Overture, a likely scenario is that the big 4 search engines
will have their own PPC models. If this happens, you'll have
4 campaigns to manage!
With true search engine listings from SEO efforts, the benefits
consistently out-weigh those of the PPC model:
- Relevance is king when it comes to a user's decision to click
on your website. A site appears to be much more relevant and
reliable when it is found in the first 10 results of millions
of page matches. Google, Yahoo!, MSN, AOL, etc. have deemed
your site to be "The One" that best meets their needs.
- Highly effective SEM campaigns should yield acquisition costs
of ~$0.07 - $0.15 per visitor (Significantly less than PPC
bids).
- Sales conversion rates can be as high as 10%, but are
typically an average of 2% - 4% (2 - 4 times that of standard
PPC models)
- Your site will receive the majority of the searching traffic;
search engine users are conditioned & prefer to access those
listings most recommended by the search engines.
- Once your site is ranked, you can stay there without your
competitor manipulating a bid every 30 minutes throughout the
day. The literal cost & aggravation of dedicating an employee
to monitor your "Max Bid" for many keywords is difficult to
swallow.
Put everything into perspective. The Internet is obviously a
rapidly growing marketplace. As this "child" continues to mature
and as thousands of new Internet users get plugged in every
single day, there is a growing audience looking for your
products or services. Are you willing to use PPC models, which
have tripled & quadrupled in average bids over the past two
years, for the next year(s) to come? Longevity, ROI, and making
the right decisions are key to your company's success.
A great analogy for SEO vs. PPC is a piece of cake. The main
Search Engine results should be your foundation & bulk of
traffic, much like the cake itself. PPC models, email marketing,
and other traffic-building vehicles should complement your SEM,
much like the icing on the cake.
Use true Search Engine results as your primary source for
website traffic just as more than 1,000 active clients currently
do with my company. When you crunch the numbers from your PPC
campaign, Search Engine Optimization makes more sense.
Stay tuned for Parts 2 & 3 of this series which will break down
visitor numbers and the value of each visitor to your company
from both PPC & SEM.
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Scott Gardner is the Director of Sales for WebSourced, Inc
(parent company of www.KeywordRanking.com and www.ProRanking.com),
leaders in Search Engine Marketing.
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