Go to Blog

You’re Probably Wasting Half of Your SEM Budget

Jay DeDapper
You’re Probably Wasting Half of Your SEM Budget

Yeah. Thought that might get your attention. And how about this: Organic is far more powerful than you think. Let’s talk.

For the last couple of holiday seasons almost all our attention has been on new types of SEM like Google PLAs (AKA “Shopping Ads”) and to the power of social media. Organic? Yeah, that’s great for dinner veggies but not so much for my search strategy. Wrong.

Organic is more powerful than ever — especially when blended with smarter SEM and Social.

Let’s start with some statistics: A new report from BrightEdge looks at what drives traffic to B2B and B2C sites. Turns out 51 percent of all traffic comes via organic while just 10 percent comes from paid and a mere 5 percent is driven from social media. Maybe even more surprising is which one drives the most revenue. Again, organic delivers more revenue than paid and social combined. BrightEdge’s conclusion: “All non-organic search channels combined — paid search, social, display, email and referred — don’t stack up to the impact that organic search alone.”

There is a lot of other research to support this conclusion. State of Digital dug deep into Google's own research and found that 93 percent of all search clicks on the internet are organic — that means a lot of dollars are chasing just 7 percent of the clicks that are off SEM. Ouch!

Then there's GroupOn's experiment. For six hours it de-indexed its site from Google making it invisible to search results. Traffic crashed big time and not only Organic as would be expected. Direct traffic fell by 60 percent as well.

Part of the problem with paid is that it’s broken. Product Search Marketing was built for the era of Google search — the time when internet users turned on a PC, opened a browser and entered a search term in Google. The era of sweating keywords, navigating SEO and buying Google search ads. An era that is ending fast.

The Rise of Mobile

Brands and retailers spent more than $18B last year on SEM in the U.S. — mostly on Product Listing Ads and CPC text ads — trying to get front and center when shoppers search for information. But what if all that money is going to reach only half the addressable market of internet shoppers?

New stats from comScore demonstrate the extent of the move we’ve all made to mobile devices as our primary internet access points. As of June, 60 percent of our internet time is now spent on tablets and smartphones — interesting but aren’t e-commerce marketers shifting their ad spend to mobile search, Facebook and Pinterest in order to adjust? Yes and no.

Go one step further and look at the incredible differences in how mobile users spend their internet time on mobile versus PCs. Remember for almost 20 years shoppers have used browsers to search for product info. Not any longer. On mobile devices only one in eight minutes is spent in browsers — and many younger users essentially never use browsers on mobile. Meaning all of those SEM dollars you spend on PLAs and text ads are chasing no more than half the shoppers interested in your product.

So if more than half of all available e-commerce shoppers aren’t on PCs and aren’t using browsers even on mobile devices how do you reach them? Follow the leaders.

The top players in mobile understand that mobile shoppers not only access but use the internet in a fundamentally different way — visually. The mobile web is the visual web. And that makes sense if you think about it: the screen is small so big blocks of text are harder to read and scroll through; the keyboard is virtual so typing gets minimized (why do you think text apps are the rage?); and the device is personally immersive so we demand lifelike interactions — sound and images.

Look at your Facebook timeline — text-only entries have virtually disappeared. Facebook has continually tweaked its algorithms to deliver more and more posts with video or pictures. Why? It might have something to do with that fact that 81 percent of all Facebook traffic is now from mobile devices on which users engage more deeply with visually-stimulating material.

Or look at the top four mobile apps. What do Facebook, Pandora, YouTube and Instagram have in common? They are all entirely or largely non-text. Even on desktops the visual web is ascendant. YouTube is just barely behind Google now as the world’s number one website.

Video Ads

At Buzztala we have been creating Product Summary Video ad units to take advantage of these trends and to give brand marketers and e-commerce companies a viable visual and mobile alternative to PLAs and text ads. We’ve been running them with a limited number of clients for the last six months and have now begun expanding to big brands like Sears and eBay. And I want to share some of what we’ve learned.

We produce product review summary videos in which we condense the mass of text-based consumer reviews for any given product into a 30-second visual summary. At the end shoppers have the opportunity to click through to a product page to see more.

What we’ve found is that these visual PSVs dramatically outperform even PLAs — and let me be clear — the click-throughs come only after someone has watched a video and proactively clicked to learn more.

Because Google’s organic search algorithms heavily favor visual results we’ve found our PSVs show up high in search. Working with online auto warranty seller ForeverCar.com we deployed videos for 100 car models this summer. After the first 45 days we saw CTRs at 11.95 percent — that compares with a Google PLA average at 2.8 percent and Google text ads at 1.9 percent. Furthermore ForeverCar saw a 128 percent increase in SEO over the same period — completely attributable to the Buzztala PRVs because they purposely made no other changes to their SEO during the period. So even for something that seems as UN-visual as extended auto warranties — these visual PSVs dramatically outperformed the standard ad types currently in use.

The bottom line is if you’re not adjusting your search marketing spend to a much heavier mobile mix you are likely wasting money. Put another way, remember roughly 60 percent of our internet time is spent using mobile devices but only 31 percent of the digital ad spend will be on mobile. That represents a 29 percent mismatch between where potential buyers spend their time and where SEM dollars are being spent.

In the same way on average 46 percent of traffic is coming from SEO yet only 21 percent of the average search marketing budget is on SEO — that’s a 25 percent mismatch.

So what else can brands and retailers do?

Four Things that Can Make a Difference

Quality Matters

Search engines — particularly Panda-powered Google — are looking for quality and trustworthy content. Sites must have an online presence that is recognized by Google as improving the user experience. The latest changes seem to reward sites with richer, deeper content that combines visuals and text across all pages. Not coincidentally that kind content will generally increase page views and session durations — both additional signals to the Big G that the site is "quality."

Videos and Images Rock

At this point it almost goes without saying the visual content is a primary key to search success. Now that 60 percent of our internet time is spent on mobile marketing and content have to be repositioned to be appealing and useful on mobile devices. Remember text is largely irrelevant to most mobile users — the top four apps are Facebook, Pandora, Instagram and YouTube. With Facebook fast deprecating text-only posts these apps all share one critical attribute: they are non-textual. Visual content is critical for a ton of reasons but here's one from the BrightEdge report that you may not have heard: Websites featuring heavy use of video and images see a 13 percent higher CTR than those with written content alone. That's some ROI to take to your CFO.

Make it Mobile

See above. Mobile isn't a trend or a fad. It is not the "second screen." Mobile is the primary way people access the internet. So along with all the stuff above about visuals think also about how a site behaves on mobile devices. Does is load slowly? Is it a pale "mobile optimized" imitation version of your main site? Is it an afterthought? Just to put it plainly: 60 percent of your customers' internet time is spent on a mobile device. Is 60 percent of your budget and effort spent on mobile?

Blend Paid and Organic

Do both. Well. Companies have to invest in both paid and organic with equal vigor, attention and passion. While paid search has a better revenue to traffic ratio, Organic drives far more traffic so ends up being far less expensive on a per action basis.

The bottom line here is pretty simple: The decades-old SEM model is broken, mobile isn’t ascendant — it’s already won — and organic matters a lot more than you probably think it does.

Image credit: Wikipedia & Canva

Like this post? Follow us on RSS and read more interesting posts:

Jay DeDapper is the Co-Founder and Chief Executive Officer of Buzztala, the Organic Video Ad Network for brands and retailers. Previously, he co-founded digital video pioneer Zazoom Media Group where as COO he guided the design, development, launch and operation of the innovative Buzz60 brand and Zazoom’s custom video CDN. Once upon a time Jay was an award-winning TV journalist in New York and Phoenix.
Share this post


2000 symbols remain
Great Article!