September 1, 2005, 12:00 AM

Making Paid Search Pay Off

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Lamberti also says comScore sees some suggestion of different consumer intent at different engines. At the portals--AOL, MSN, and Yahoo-- comScore sees less challenging search activity and the use of simpler search terms. By contrast, Google brings in more complex search queries. He adds, "What that suggests to us is that when consumers have a more challenging research task, they may be thinking about Google as a way to get that done."

Data and anecdotal information from search engine marketing companies point up other subtle differences among engines. With a few exceptions, "We see better conversion rates for our b2b clients in Google`s PPC search ads," says iProspect.com Inc. CEO Frederick Marckini. By contrast, he estimates two-thirds of his company`s b2c retail clients perform better in Yahoo. However, iProspect`s data, gathered from analytics attached to its automated bid management agent, iSEBA, show that the difference in conversion rates is slight, perhaps half a percent. A spread of that size is meaningful or not depending on the marketer`s going conversion rate. "If your conversion rate is half a percent, it means a lot to double it," says Ben Perry, manager of paid search at iProspect.

More than one way to measure

And even where differences in direct conversion are identified among engines, they`re not the only way to measure ROI, Lamberti points out. The more specific the search term, the more likely it will result in a direct conversion. But many consumers use only broad terms to start their research online, eventually taking their search offline and buying in a store or from a catalog. And whether the purchase eventually is transacted online or off, it may be weeks or months after the initial click occurred, representing a latent ROI attached to the earlier, broader search term that first introduced the buyer to the product or brand. "In search, a lot of ROI is left on the table," says Lamberti.

It`s a dynamic that`s equally true for search marketing campaigns across all engines. That highlights the view, shared by many search marketing professionals, that from a marketing value perspective, what the top-tier engines have in common-- a platform that reaches millions of potential customers who declare their interest by what they choose to click on--is more important than any differences. It`s what strategy and not which engine that wins or loses, they say.

"You always want to spread your money and find the best pieces of both engines," says Kevin Lee, CEO of search engine marketing firm Did-It.com LLC and chairman of the recently-formed Search Engine Marketing Professional Organization. How to find where those pieces are? Trying out and measuring what produces clicks and sales and what doesn`t, across keywords, landing pages, and ad creative, are the best ways to gain an understanding of the potential of a keyword on a particular engine, say the experts.

For example, Google`s paid listings format doesn`t have a lot of space for copy, and users must click on the ad to read the full text after seeing a few initial words. By contrast, Yahoo`s format allows room for more copy, giving marketers the opportunity to add words that could entice a click, such as "free shipping," for instance. That`s one way that what`s in a listing, rather than audience demographic or psychographic attributes of the engine it runs on, makes the difference.

Core keywords

Lee advises clients to start a paid search program by determining a core set of keywords, then figuring out the metric to be used to measure campaign success, such as cost per order, ROI, or venue per dollar spent. Then, set a benchmark that represents the tipping point at which the keyword campaign works or doesn`t work. Next, marketers should consider what creative their customers want to see. One Did-It client, Haband, makes men`s trousers that customers think of and search for as "slacks" rather than "pants." That shows that knowing how to write the creative that customers associate with the brand or product makes a difference between campaign success and failure.

Developing a testing strategy is core to search campaign management, on any engine, Lee says. "Until you go live and create a feedback loop that tells you what is working and what is not, you won`t know whether `red cashmere sweater` is worth more on Google or Yahoo," says Lee. "Put campaign analytics in place and you will see that for every thousand visitors that came off `red cashmere sweater` in Google and every thousand that came off Yahoo the conversion rates were different."

Handling paid search across two major engines is already a handful, but the logistical demands of handling paid search campaigns across the marketplace are about to change, because the PPC marketplace itself is changing. MSN.com is expected to launch its own paid search product, eventually replacing its paid search feed from Yahoo. Though MSN.com declined an interview request, most industry observers believe that will occur within the next few months. Some believe it could be in time for the peak of the holiday shopping season.

Ask Jeeves, the fourth largest search engine according to June figures from comScore Networks, announced in August it will launch its own paid advertising network, using a keyword auction model similar to Google`s and Yahoo`s. Ask Jeeves will run its own paid listings alongside those it currently gets from Google under a revenue sharing contract with Google that runs through 2007. Eventually, most industry observers believe, Ask Jeeves` paid search offering will stand alone.

The management headache

In addition to listings on Google.com itself, Google has another big distribution partner for paid search in AOL.com. Given what`s poised to happen at MSN.com and what`s already happening at Ask Jeeves, will AOL at some point go in the same direction and split off a paid search offering of its own? That`s speculative, but "It would make sense that most of the major publishers will start selling their own search ads because they don`t want to give someone else a piece of the pie," says Brooks.

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