Managing search more challenging—and rewarding—than ever
General best practices have emerged around search engine marketing, but for online retailers working with an outside search engine marketing provider, specificity is one of the most important keys to success as the provider must understand the retailer’s business. Tom Tweedie, director of consumer direct marketing at Day-Timers Inc., shared that insight from Day-Timers’ experience in a presentation on pay-per-click advertising and search engine marketing at the Internet Retailer 2007 Conference & Exhibition.
With an increasing volume of business coming in online—currently 40% of direct sales and 60% of new customers—Day-Timers is moving more of its advertising spend online, and it wanted to ensure the best return for that investment, Tweedie said. Day-Timers is No. 462 in the Internet Retailer Top 500 Guide. Deciding to pursue optimization initially rather than pay-per-click advertising, it selected vendor iProspect after talking to other retailers, reading industry reports and meeting with several firms.
Two important factors in choosing a search engine optimization vendor are the vendor’s longevity in the industry and the dollar volume of accounts it manages, Tweedie said. “You need to see where you are going to fit in,” Tweedie told attendees. “Are you going to be a major account for them or a smaller player?”
Because Day-Timer’s paper-based time planners represent a narrow assortment and because its business is highly seasonal, some of the standard practices of search engine optimization weren’t a fit for its business, Tweedie said. “We usually get one order per customer per year,” he added.
That means the metrics most important to Day-Timers are new customers and the ability to maintain the same customers for that order over several years; metrics that are different from some measures of success at other online marketers, he added. To justify a spend of $25,000 per month on optimization, Day-Timers came up with a target of 1,000 customers it could tie to optimization efforts, based on a gross profit per order of $25 or 50% of product sale price.
But tracking showed only 80% of customers coming on were actually new customers, so Day-Timers adjusted the target to 1,200 customers to make its 1,000 new-customer goal, Tweedie explained.
He added Day-Timers is achieving success through its search engine optimization program as measured by the new customers acquired as well as by metrics such as increases in overall visibility online, organic search referrals and the number of pages indexed by search engines.
During the same session, Corey Nielsen, Internet marketing manager at musical instrument retailer The Woodwind and Brasswind, told retailers to adjust their expectations of search engine marketing. “It’s a myth that what a good search engine marketer will do is drive targeted traffic to your web site at a profitable cost,” Nielsen said. “The reality is that a good search engine marketer will spend most of his time trying to control the chaos.”
Among challenges to search engine marketing, he listed technical issues, poor site merchandising, competitor impact, increasing costs per click and others.
To bring order out of the potential chaos of search engine marketing, Nielsen advocates a system that starts with defining the customer, defining their goals, defining the retailer’s goals, defining the sales process and tracking that process.
“Best practice is to define your customer groups and their goals before you do anything else, like jump into keyword selection,” he said. Some ways to classify customers into groups is according to their reason for a purchase, their state in the buying cycle or their personality type, he said.
Nielsen added that the most critical factor in search engine marketing is to set up a tracking and reporting system. Nielsen manages his campaigns not to the metric of conversion but to gross profit return on ad spend. “A lot of vendors can track that for you now as long as you have the back end to do it,” he told attendees.
Also during the session, presenter Ramón Coupe, CEO of SEM vendor Your Amigo, focused his remarks on the concept of the long tail in search engine marketing. The concept is that because the online channel isn’t constrained by the shelf space limits of a bricks-and-mortar store, online retailers can carry more of the products that are less frequently purchased. Thousands of such niche products—the tail—sold in ones and twos add up to significant sales and growth opportunity, Coupe told attendees. “But consumers need to find the tail—search is critical,” he added.
The key to the long tail is to create additional new web pages optimized for long-tail searches. Those pages should be assembled by considering all possible relevant search queries and then building additional new pages—essentially, subcategory pages—rich in those keywords. “More content equals more keywords, which equals more potential traffic,” he said.
Caveats to pursuing optimization for the long tail include the demands on resources and expertise, the requirement of managing the thousands of extra web pages typically involved, and the challenge of ever-changing search engine algorithms. But because long-tail searches typically have a higher conversion rate, “the long tail of unique search phrases can, if optimized correctly, account for a majority of traffic and conversions,” Coupe concluded.
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