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Do Big Brands Spell Trouble For Search Marketers? 
By: Mr. Frog 2006-08-02 Keyword prices fluctuate predictably throughout the year, as demand for them ebbs and flows. The peak season is, naturally, during the Holiday shopping period, which begins well before Thanksgiving and extends through New Years.
Right now, keyword prices are moderate; in fact some studies indicate that for some high volume keywords prices have fallen a bit over the same period in prior years. According to figures recently published by Fathom Online, the average keyword price was $1.27 in Q2 2006, down almost 9 percent from Q2s $1.39, which was down about 11 percent below Q4 2005s $1.43. Its a safe bet that prices will begin moving upward again in September, as people in the U.S. finish their vacations and business again prepares for the big holiday rush. Still, there are worrying signs that this shopping season may see a steeper rise in prices than weve seen in past years. As recently noted by Chris Sherman at Search Summit, there are new reasons to be concerned about keyword inflation. Sherman points to a phenomenon that may not be obvious to many search marketers: the fact that more major brand advertisers are beginning to show interest in the Paid Search marketplace. So far, the amount of money these big advertisers have been throwing at search has been a tiny sliver of their overall spend. But as word trickles through corporate boardrooms about the power of Search, this spending will increase. As Sherman notes, big brands have barely started to play." Add to this phenomenon the fact that the search engines are selling more and more contextual inventory and the overall spend increases are more dramatic. Were talking a lot of money here " the global spend on advertising is about $500 billion, and spending on Search is just 1 percent of this right now. Suppose the big brands collectively decided to increase their Search spend to 2 percent? Unless the engines were able to magically increase their inventory of results pages overnight, the result would certainly be massive keyword inflation. Sherman recommends that the best way to insure oneself against keyword inflation is to invest in SEO, given that organic rankings are immune to price fluctuations. While I agree with Chris that good organic rankings are essential, I think that youve got to do more, because the best, most profitable SEM campaigns have both an organic and a paid component. Our own studies at Did-it have concluded that without a paid presence on SERPs, ones conversion rates can drop as much as 60 percent. Unless you have both great organic rankings and great paid positions, youre going to be leaving money on the table. Fortunately, there are there steps you can take now to cushion the impact of higher prices on your Search campaigns. They include: 1. Expand Your Keyword Discovery. Take a look at all of the permutations and combinations of keywords associated with your campaign. New research has shown that the average number of terms used in a search query is 2.57 words. 20 percent of searchers use query terms of 4 words or more. Searchers are clearly becoming more accustomed to using multiple terms in query strings; the good news for you is that these long tail combinations are much less subject to keyword inflation. 2. Focus on Precision, Not Reach. Chances are you wont be able to outbid your deep-pocketed competitors in a head-to-head battle for certain keywords in national or regional campaigns. But you might be able to reach positional parity or even superiority on SERPs if you employ one of the many segmentation technologies which the engines now employ. These include demographic targeting, dayparting, geo-targeting, and will likely soon include some flavor of behavioral targeting. Although its possible to accomplish these tasks without an automated campaign management technology platform, its much easier if you employ technology as your ally. Managing large numbers of long tail keywords is difficult enough; when you begin to play with all the permutations permitted by segmentation technologies, the complexity can become overwhelming. Make sure your in-house team or SEM agency can provide a sophisticated technology platform, plus the analytical smarts to make sure that youre getting the most from your PPC campaigns. Because in a marketplace in which big brand spenders are waiting in the wings, you cant afford any waste or lost opportunities. Tag: keywords, branding, SEM Add to  Del.icio.us |  Digg |  Yahoo! My Web |  Furl
Have a bookmark! -  About the Author: Mr. Frog is a leading Search industry visionary. Mr. Frog is a member of the Did-it Search Marketing team which accompanies him to most major marketing conferences. |
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