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Recent conversations in the search engine marketing community point to a developing trend that is disturbing: the promotion of the idea that paid search is more valuable than search engine optimization, and visa-versa. Although there are many legitimate arguments on both sides of the discussion, some claims made by highly visible parties are darkening the waters of search. This could not be happening at a worse time, as more and more brand managers are looking towards search as an important part of the marketing mix.
In 2006, numerous research studies showed that paid and organic search, as well as the use of shopping feeds and paid inclusion programs, were highly rated by marketers employing them. Lee Oden compiled an excellent list of resources at his Top Rank Blog last September (found at www.toprankblog.com/2006/09/organic-versus-paid-search-results). A major takeaway from the research in this variety of reports is that both paid and organic search efforts lead to marketing satisfaction.
Analyzing conversion rates from both paid and organic efforts is something that sophisticated search marketers have adopted as standard operating procedure over the past couple of years. When analytics systems are properly configured, the granular nature of the metrics derived from search marketing is difficult to match. An eMarketer report released in April of 2006 (Search Marketing I: Spending and Metrics) shows many instances of both paid and organic search being at the top of the online marketing mix.
One report from the SEMPO State of the Market Survey conducted in late 2005 shows that 83% of respondents were using paid placement initiatives versus only 11% using SEO. Based on other reports that show the value of SEO rising as sophistication increases, one can hypothesize that this disparity will likely be less when the 2006/2007 report is released in March of 2007. eMarketer cites Marketing Sherpa’s 2005 report showing SEO conversion rates overtook paid search rates at 4.2% to 3.6%, respectively. In 2004, the number skewed heavily towards paid search, with an advantage of 6.6% to 6.1%. The drop in overall conversion rates does pose additional questions.
How trusting are marketers of paid and organic search efforts? eMarketer cites a Direct Marketing Association report from late 2005 which ranks paid search and organic search equally (6%) in the list of an “online marketing strategy that produces the best ROI, according to U.S. retailers,” behind only “having a website” (38%) and using “email marketing” (33%). In the near future, search as a whole should close the gap here. A similar question posed to advertising agencies in the SEMPO survey showed that paid search and SEO greatly outdistanced other online marketing methods, including email marketing. Naturally, it would be nice to see more consistency in these types of reports; however, the main trend to notice is that both paid and organic search are consistently coming up on top.
More research is due to be released shortly after this issue is published, and will hopefully corroborate the above predictions of an increase in the perceived and measured value of paid and organic search methods during 2006.
One final prediction I’ll make is that large agencies that focus on providing search holistically in 2007 (such as SendTec, iCrossing, iProspect, and Avenue A | Razorfish), as well as some smaller effective firms (such as Range Online Media and SEOmoz) will be able to serve their clients better under one umbrella. This is not to say that firms who specialize in either paid or organic search can’t do as thorough of a job in each discipline, but rather to suggest that some organizations that rely on multiple vendors may miss out on a holistic overview of the search landscape.