So we’re officially in a recession now (according to official government figures via the BBC) with no sign of things getting better anytime soon. Marketing budgets are being slashed by many and redundancies are spreading like wildfire. So, if you want to either make the most of your marketing budget, or if you’re in marketing and you want to hold onto your job, where should you be putting your money in online?
It’s pretty simple to be honest, just keep spending but make sure it’s working for you!
Something I’ve been doing for many years is capping all my online marketing spend through the use of a CPA (cost per acquisition) limit. Work out what you can afford to spend per sale/referral/lead and still make a profit, optimise your use of the various marketing channels available to keep your cost per acquisition under the limit, and then keep spending!
Hard to justify in the current climate? Just build a business model to show your boss (or yourself) which demonstrates the returns available by keeping spend tied to a CPA.
This is one of my bugbears, especially with regards to PPC (paid search). If it’s working for you, your campaigns are optimised continuously, and you’re coming in under your CPA, then why not throw more money at the campaign? Yes, you have to be diligent to ensure that your CPA limits are adhered to, but once you have it embedded as a process in your organisation it’s not that difficult to grow your spend and as a result your return.
So where should the marketing spend go (in online)? Well, into channels which are measurable and where you can track the returns. Paid search, affiliate marketing, banners (yes, you can work to a CPA if you use the right tools), social media campaigns, viral and of course natural search (search engine optimisation). Of course SEO deserves a different CPA to other channels as it’s naturally cheaper to do as long as you stick to the principles and don’t get sold by an agency looking to charge you the earth for something that costs nothing but common sense.
February 26, 2008
Interesting take on the role of search marketing in travel here from Elisabeth Osmeloski of Search Engine Watch.
Not completely sure I agree that seasonality will disappear, there will surely always be a place for targeting specific seasonal activities and travel times with certain keywords. Yes you may run the campaign full time but it’s usually a good idea to ramp it up in the appropriate seasons.
February 26, 2008
ComScore have released some data showing that clicks on ads on Google were down 7% in January compared to December and flat year-on-year (actually down 12% qtr-on-qtr).
This is pretty astounding news after the growth Google has seen in ad clicks over the last few years. The thought is that this isn’t anything fundamentally to do with Google or any competitor taking market share away, rather analysts seem to think this is a sign of the economic uncertainty we are currently seeing. Times are hard so people click less on ads….
What would be interesting is to see the search volume data alongside this click data to see whether searches have declined or stayed the same.
Needless to say Google’s shares have taken a bit of a battering today because of this.
February 16, 2008
Now I’ve just been proved totally wrong. I wrote a while ago that paid search budgets may actually start decreasing (slightly) or stagnating by the end of 2007 in travel as marketers got their heads around affiliates, other new behavioral ways of marketing online and moved back to seeing the huge value in SEO. Also a backlash against paying per click has been expected for some time as marketers try to get everything measurable on a CPA basis.
Seems that’s not the case though. Robin Goad of Hitwise has a post which talks about some paid and organic search trends in travel and shopping sites through 2007. One really interesting chart shows that the Hitwise Shopping & Classifieds categories paid search activity actually decreased in 2007 compared to 2006. Travel on the other hand grew by 15-20% during the final three months of the year.
Also, there a great chart showing the trend for paid search traffic to the two categories from late 2006 to the end of 2007.Interesting dip around July 2007 there. Anyone hazard a guess at what that may be? I know it’s not the busiest month of the year but that’s a hefty drop in paid search spend.
February 7, 2008
Click Forensics has reported on the 4th quarter of 2007’s click fraud volumes. They’ve seen an increase of 2.4% year on year with the latest quarter registering a massive 16.6% fraudulent clicks. That’s the overall figure for the industry average according to their index. The figure for content networks such as Google Adsense sits at 28.3% which is huge!
This is really worrying for anyone with a large paid search campaign. I would have expected these figures to drop due to technological advances from the search engines platforms, instead they seem to be climbing.
January 31, 2008
A report (here via Marketing Charts) shows that ROI on search marketing has improved in the past year.
What is really interesting is the figures showing ROI improvements by search engine. Google has improved ROI by 7.5% (and it’s taken a whopping 76% of the total spend). Yahoo showed a 39% improvement in ROI returned to advertisers since the launch of Panama which is great news for them although coming at a difficult time. MSN interestingly shows the highest clickthrough rate and ROI, it’s ROI was 27% greater than the average across other engines.
Just shows why the money is still all in search at the moment. While returns like this are to be had it’s going to be tough for anyone to convince me that it’s worth moving money out of search into other areas.
January 26, 2008
Google has announced the launch of demographic targeting for Adwords. This will enable you to show your paid search adverts to more targeted customers and thus drive better qualified traffic to your site. Very useful!
This involves site owners sending Google anonymised user data so that Google can then track these people and serve targeted ads. Surely this has to raise questions for data protection? That said, it is immensely useful to any retailer with data on their visitors!
January 14, 2008
Paid search (according to Marketing Charts) contributed 57.1% of the total spend on online marketing in the UK. The spend was up 44% year on year for the first six months of 2007 compared with 2006.
This just shows how effective it is and where your marketing pounds should be aimed.
Classifieds has shown good growth as well but this is not as targeted so it’s obviously not going to get the same amount of interest as search for the moment.
Reasons for using search are cited to be lead generation, driving direct sales and traffic generation. Great to see sales being the equal top reason for using search. For too long it’s been seen as a way to drive traffic and acquire leads, when actually it is the most effective way to drive a direct sale available to online marketers.