80/20 Principle Squanders Paid Search

4 comments

I might be out-of-line with my thinking but as I was reviewing some of my clients’ paid search campaigns I noticed an alarming pattern.

What I noticed was that about 80% of my available impressions (if not actually higher) come through only 20% of the paid search engines I use to target and attract qualified visitors. I primarily use four paid search engines (Google AdWords, Yahoo, MSN, and LookSmart) and will expand to others depending on the client’s market, product or service (including geographic service considerations). This is alarming because the decline between my top PPSE (Google AdWords) is significant compared to my second best PPSE (Yahoo Search) and the gap only broadens when you compare to the others.

So why is this alarming? First, it shows how powerful Google’s properties are among searchers. The last statistics I saw from SearchEngineWatch.com (April 2007; reported The ClickZ Network, Jun 19, 2007) showed Google commanding 55.2% market share compared to Yahoo with just 21.9%! After these two – it only gets uglier with MSN at 9.0%, AOL at 5.4% and Ask with a mere 1.8%. Google has the widest distribution and with it the swarms of pay-per-click marketing competitors gunning for the same big payoff.

Second, since it seems that only a few search engines are required to support the search population, it’s tough for Yahoo and others to partner with new, wide distribution search engines that offer an opportunity to close the gap with Google. I spoke to MSN today about the low impressions for my campaigns, where certain keywords in Google are receiving 70 to 100 times the impressions they are getting in MSN. I asked about MSN’s distribution since they serve only MSN properties and the response was that MSN is growing their content network. Unfortunately, unless content advertising becomes more effective (conversions are typically much lower on content than search) I don’t see content being an exciting alternative to search – just a “no-where-else-to-go-alternative.”

So the point is to invest in maximizing your Google AdWords’ campaigns (which holds the greatest distribution opportunity) because looking to expand your distribution across other paid search engines is limited. A higher click-through and conversion rate for a Google AdWords campaign will probably double your sales compared to even an optimized campaign in MSN just because of the available impressions.

Agree – Disagree? Let me know!

About the Author

Kevin Gold is Director of Internet Marketing at iNET Interactive, a social media company operating prominent online communities for technology professionals and technology enthusiasts. Kevin is a frequent contributing author to multiple publications including Search Marketing Standard, Practical eCommerce, DIRECT, Entrepreneur.com, ConversionChronicles.com, About.com, and On Target (Yahoo! Search Marketing newsletter).

Add Your Comments

  • (will not be published)

4 Comments

  1. I agree wholeheartedly. I use GGL, YHO, MSN and ASK, and 99% of my conversions come from GGL. It is interesting that MSN just scored Digg's business. Truthfully, I could cut out the other three and not hurt my lead stream. I maintain them because of the overall web visibility it brings.

  2. Brent

    I would agree but add that in my experience the results can be tilted towards the other SE's depending on what you are trying to promote via PPC. I have seen certain trends that I can only attribute to certain SE's have different audiences and sometimes this shows through in the results of a PPC campaign.

  3. Great comments! Brent I would agree with you although I am not seeing as large of a difference as I once had especially between Google and Yahoo Search. I actually wrote an article for HighRankings.com's newsletter in October 2004 (High Rankings® Advisor Issue 118: Using Demographics To Increase Conversions ) about accessing different demographics via the SEs. Although demographics and psychographic differences certainly still exist I am seeing a pattern where Google's sheer search volume attributes to a greater opportunity to close more leads or sales. At the same time though, home-based business and franchise opportunity search volume does appear to be greater from Yahoo Search than Google indicating potential demographic and psychographic differences playing out. Either way - thanks for the comments. I recommend that every web business at least tests and measures the results from the top three PPCSEs (Google AdWords, Yahoo Search and MSN AdCenter) as well as some of the vertical search engines. It’s the only accurate way to see what works most effectively.

  4. Great topic. Kevin, you're absolutely right based on volume. I also couldn't agree with you more on your comment about testing the different engines. We see very different results based on the particular client and industry in terms of conversions. We always start off budgeting more for Google, and more for Yahoo! than MSN, usually based on current market share. And save for entertainment, we always get more conversions by volume from Google. Return on Ad Spend (ROAS) varies, though, seemingly with every client. Sometimes sheer volume outweighs ROAS as a determining factor because of time and effort, but many times it does not.