February 28, 2006, 12:00 AM

Are these guys making too much money?

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Best Buy, for instance, may pay more for generic keywords like “digital cameras” so that Best Buy appears high up in the initial queries. But it pays less for brand and model names that consumers search on when they are ready to buy. “We don’t always have to be in the top spot and pay a lot of money,” Taylor says. “We manage our portfolio so that we show up in search where we want to be.”

Another question is: If a search campaign isn’t producing the desired online traffic and sales, could some of the intended traffic be arriving at call centers or stores? “The Holy Grail is determining the multi-channel impact of search engine marketing,” Larkins says, adding that some marketers conduct point-of-purchase surveys to determine what motivated customers to shop, or place unique 800 telephone numbers or landing page addresses in search ads. Others use tools like Ingenio Inc.’s Pay Per Call, which runs on AOL and other advertising networks’ search ads and provides a toll-free number to the retailer’s call center. Advertisers’ Pay Per Call search rankings are based on the amount they are willing to pay for each call.

It’s also important for marketers to understand how certain keywords are more or less effective during particular seasons-and to be ready ahead of time with effective ad creative when it’s time to bid up a hot keyword. “A lot of retailers miss out on opportunities by not having creative ready,” says Dave Williams, chief strategist for search marketing firm 360i. “So late in the game they’re bidding up keywords.”

One of the biggest goals of many search marketers is to figure out how to get the best rankings in Google, the leading search engine. Google ranks paid-search results on both the keyword price and the relevancy of the web sites linked to keywords. Relevancy, of course, is also the basis for ranking in natural search. But Google has never said publicly exactly how it determines relevancy, though most marketers believe it’s a combination of domain names, links to and from a site connected to content pertinent to a keyword, metatags or codes that indicate a web page’s content, and, more recently, an indication that a site’s visitors engage in online communications about searched-for content.

“Now Google wants a site that conversationally uses that content,” says Jack Reynolds, co-founder of QuikDrop International, a chain of eBay drop-off stores that participates in new Google programs as soon as they become available, including its new Google Analytics, which enables marketers to track the cost of Google campaigns and compare that to conversions on individual pages.

No more gibberish

At the same time, he adds, Google is making it more difficult for web site operators to display redundant content in order to artificially boost their search rankings. “It’s getting harder to put up gibberish, because Google can tell if you’re using content in the proper context,” Reynolds says.

Still, getting better results can take several attempts-and force retailers to rethink what they do online.

When Batteries.com launched a new site in 2004, it inadvertently hurt its natural search rankings in Google by keeping many of its old pages active so as to avoid dead links, says Batteries.com president Dale Petruzzi. But that caused search engine crawlers to pick up an extensive amount of redundant content on the old as well as the new pages, causing a drop in natural search rankings. “The search engines saw us as trying to duplicate our content,” Petruzzi says. “That flagged them that we were trying to do something sneaky.”

Working with search engine marketing firm iCrossing Inc., Batteries has since revised its site for better search engine optimization, including the elimination of the redundant pages. Within four months, its number of pages indexed by Google grew from 320 to 61,000.

Batteries.com now typically appears high up on the first page of Google and Yahoo search results on battery-related search terms. But to further improve its appearance in natural search rankings, the retailer recently launched the first five of about 30 special content microsites carrying information about particular product categories, such as alkaline batteries or laptop batteries.

The microsites offer information about battery products and provide links to Batteries.com for making online purchases. Petruzzi figures that the extra content tied to Batteries.com will further lift its presence in natural search rankings while providing the retailer with additional listings within the rankings. “We almost fell off the search map, but we found a great formula to get back on it,” he says.

Ice.com had a similar experience with weblogs that it created as an information service for consumers (Internet Retailer, January, p. 10). “Through our blogs we’ve seen our keyword rankings go up,” executive vice president of marketing Pinny Gniwisch says. “That was not part of our plan for the blogs-we wanted them as a service to customers-but it happened.”

As retailers figure out new techniques to improve their search marketing ROI, the search engines say they’re also doing their part to make search more effective. Both Google and Yahoo offer programs for submitting content to help their crawlers catch the right information, and they continue to introduce products that marketers are invited to join as beta testers. And while Google and Yahoo are the established major search engines, others keep striving to offer something different. Kanoodle, for instance, offers an advertising network that lets marketers bid for contextual ads on major media sites such as MSNBC.com, where an ad for, say, women’s apparel, might appear in an editorial section about the latest fashions.

MSN, meanwhile, is hoping to gain ground on its larger competitors Google and Yahoo by offering something they don’t offer-at least not yet. MSN’s AdCenter provides marketers with data on search recipients’ age, sex and city. By offering various ways to analyze that data, AdCenter makes it possible for marketers to continuously modify their search campaigns to demographic groups with particular keywords, says Jed Nahum, director of product management for MSN AdCenter.

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