June 26, 2003, 12:00 AM

Paid vs. natural search results: a new way to measure the difference

New functionality added to NetIQ’s WebTrends analytics sheds light on when to buy keywords vs. when to optimize.

NetIQ Corp.’s WebTrends reporting series has added new functionality to the analytics tools that it says will allow online marketers for the first time to distinguish results from paid search versus natural, or algorithm-based, search campaigns. The enhancements, launching this month, separate results from the two types of campaigns beyond click-through all the way to conversions and lifetime value, the company says.

The new functionality aims to answer questions on search engine marketing that are now top of mind among online marketers, according to NetIQ Corp. It will enable markets to determine, by search engine, whether paid or natural search listings are generating a higher return and guide decisions on which keywords are critical to purchase versus those that aren’t, the company says.

That’s important as marketers seek to squeeze the most value out of what they spend on search, says Brent Hieggelke, director of WebTrends Marketing at NetIQ. “We’re still in a bit of a gold rush, with people buying thousands of keywords because they just don’t know. But people will become very selective about what keywords they pay for,” he says. “Once they start measuring results rationally with tools like the ones we provide, they’ll realize that there are certain words they need to pay for and others for which they should just cut bait and move on.”

Pay for performance programs represent an increasingly large share of what marketers are spending on online search marketing efforts. According to a recent report from U.S. Bancorp Piper Jaffray, spending on paid search rose to $1.3 billion from $500 million over the past year.

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