Tuesday, May 15, 2007

And Another Thing Regarding SEA…

I recently reread Niki’s blog about SEM being more than just paid search and would like to chime in from a different perspective. While I agree that mega-agencies gravitate to SEA as an easier and more profitable solution for less-informed clients, the search engines themselves are also aiding and abetting the blurring of the lines between SEO and SEA. Do you really think the name Yahoo Search Marketing for their SEA program is coincidental? And why wouldn’t the search engines be so inclined given their financial success is dependent on SEA revenues?

Which brings me to the other thing regarding SEA – the fog about how many searchers click on paid ads vs. natural listings. I’ve seen reports showing a range of 10% to 40% (the latter conducted by SEA-oriented agencies and not based on real-life results) for clicks generated by paid listings.

Okay, first thing to note is that regardless of the range, the clear conclusion is that SEO delivers more clicks than SEA. Period.

Second, the range is generated in aggregate terms; i.e. the total is for clicks on all the paid listings, not on an individual basis. I mean, who has ever gotten a 40% click-through rate for their paid search ads?! Even 10% looks great when Marketing Sherpa reports the highest average click-through rate for 2006 was 3.5% for the specific segment of B-to-C ecommerce products over $200.

Finally, if the three major search engines were actually getting high volumes/revenues from paid clicks, why have they all recently changed their bidding structure to actually reward clients for boosting higher click-through rates?

Please don’t misunderstand – SEA can have a legitimate place as part of your integrated approach to SEM. Just don’t have unrealistic expectations based on propaganda that supports revenue models different from yours.

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