November 7, 2008, 12:00 AM

Retailers fare poorly in natural search results, Conductor study shows

In many cases retailers did not show up on the first 10 pages of results when testers entered keywords that the retailers bid on for paid search placement. Most Fortune 500 companies did not do much better, a new study finds.

 

Retailers, and large companies in general, are not doing a very good job of optimizing their sites so that they show up near the top of natural search results, according to a study by Conductor Inc., which specializes in search engine optimization.

72% of the Fortune 500 companies barely showed up at all in the first 100 search results on terms that those companies bid on for paid search placement, Conductor says. That means a web user searching for a term such as “laptop” could click through 10 or more pages of natural search results and not find a company that bid heavily on the term “laptop” for paid ad positions.

The two dozen retailers in the study collectively finished ninth among the 15 categories of companies. Accommodation and food service companies had the top score and mining and oil exploration companies the lowest score.

The study, which Conductor carried out in conjunction with Internet advertising research firm SpyFu, determined 10 keywords that each company bid on frequently for paid search placement, then examined where the company placed in natural searches on those terms. In most cases, a retailer would show up fairly well on two or three terms, and have practically no visibility on the rest, says Seth Dotterer, chief marketing officer at Conductor.

For the Fortune 500 as a whole, only 2.87% of the domains controlled by those large companies had a significant number of terms show up high in natural search results, which the study defined as in the top 30 results. Only 8% showed a mid-level to strong presence.

Since 90% of clicks are on the first page of search results, and about 5% on the second page, anything past those two pages means there is little chance that a listing will generate a click, Dotterer says. Why do big companies far so poorly in natural search results? Natural search is more complicated than paid search, and it takes longer to show a return on investment, Dotterer says.

Among the retailers, Gap Inc., No. 24 in the Internet Retailer Top 500 Guide, scored the highest in natural search results followed closely by Office Depot Inc., No. 3. Dotterer notes that Gap focuses its paid search campaign fairly narrowly on about 3,000 terms, while Office Depot bids on about 33,000 terms.

In general, the retailers in the study bid on far more paid search keywords than other companies-an average of 24,700 for the retailers versus 5,100 for all companies in the study. A few online-only retail companies, notably Amazon Inc. and eBay Inc., bid regularly on 250,000 to 750,000 terms. Overall, the two dozen retailers in the survey accounted for 67% of the terms that the entire Fortune 500 bids on for paid search positions.

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