23 Musings

This image from eMarketer shows just how sewn up the online ad world is by the big four...

When Google drops the branded terms rules on 5th May I reckon their revenue and share will leap as the cost of those terms in PPC rises!

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.

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.

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.

Marketing Sherpa has quizzed 420 top digital marketing experts about what they feel are the most effective methods for advertising online and which give the best ROI.

Search engine optimisation came top, this is not surprising as the ROI is incredible. Some changes take such little effort and can return such amazing gains that SEO will always be the top in a survey like this.

Second came behavioural targeting for adverts, slightly more surprising this one as I wasn't aware the technology was quite there yet to get a better ROI than other ways of advertising such as paid search.

Paid search (or PPC) showed quite a drop in confidence in delivering ROI, however marketers said that the biggest increase in budgets would be in the paid search arena.

And the biggest trend in measurement for this year was voted to be the integration of search and email analytics with your standard onsite analytics thus completing the tracking of the customer journey. Integrating offline and online campaign tracking came second here, now that's a holy grail and I don't believe will be truly possible for a year or so longer.

Interesting study; more available here.

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.

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!

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.

We all know how notoriously difficult paid search is to get right in a highly competitive marketplace. Take car rental, loads of players, very high bid prices and some really proficient PPC campaigns. Need a what to stand out from the crowd? Take the lead from Sixt of Germany then, they've done something very clever with ascii art to make their adverts stand out from the crowd.

This is genius, and they experienced a 40% plus increase in clicks on the campaign! Something that could be applied to many industries!


This campaign has just won an award, more details here.

Tripadvisor have released their figures from a survey called their Traveller Trends Survey. Out of the survey comes some predicitions for 2008 trends that we should all expect to see.

One of the aspects of this (the link above has much more detail) is the TripAdvisor TravelCast. It's a barometer of what’s hot in travel destinations. TripAdvisor engineers have developed a proprietary algorithm that looks at several criteria, including changes in search activity and postings throughout the TripAdvisor site. The TravelCast then predicts the rising stars in travel.

The destinations that are showing as increasing in popularity and expected to be the biggest next year are:

TripAdvisor TravelCast Top Ten World Destinations for 2008
1. Jerba, Tunisia
2. Makandi Bay, Egypt
3. Phangnga, Thailand
4. Kovalam, India
5. Sabaudia, Italy
6. Asilah, Morocco
7. Ko Phangan, Thailand
8. La Plagne, France
9. Yangshuo, China
10. Kotor, Montenegro

TripAdvisor TravelCast Top Ten U.S. Destinations for 2008
1. Sunny Isles Beach, Florida
2. Kitty Hawk (Outer Banks), North Carolina
3. Seward, Alaska
4. Kailua, Hawaii
5. Blue Ridge, Georgia
6. Mount Pocono, Pennsylvania
7. San Marcos, Texas
8. Paso Robles, California
9. Rockport, Texas
10. Copper Mountain, Colorado

Now, this is great insight for online (and offline) travel providers who bid on keywords on search engines. If you are active in pay per click and these destinations match some of your offerings then you should seriously consider looking at the data (clickthroughs, bid positions, bid amounts etc) to see if you can do anything else to get more clicks on these terms. If they are going to be so hot next year it may be worth diverting some of your paid search budget into these destinations over those that don't perform for you currently. Insight like this is highly valuable, especially when it comes from such a big community as TripAdvisor.

Click fraud, the bane of every marketer who deals with paid search, is currently sitting at around 16% of the clicks you may be receiving. The average rate is 16.2% and can be significantly higher on content networks.

The average rate was 13.8% a year ago and 15.8% last quarter so it is rising quite fast:

The average rate of click fraud on content networks such as Google Adsense or Yahoo Publisher Network has risen more sharply:

The graphic below shows a threat map for where click fraud can be generated:

So why this continuing rise? Well as it's coming from content networks I can only guess that it may be being generated by rogue publishers and bloggers who are auto-generating extra clicks on their sites in order to raise their income. This kind of practice could really be affecting your bottom line and giving you a falsely inflated CPA (cost per acquisition) on your paid search campaigns.

Well worth keeping an eye on! And if, like me, you have a large campaign under your remit then contact your agency asap to check that you are receiving any rebates the search engines such as Google provide.

Thanks to Marketing Vox.

Interesting analyst opinion from Bear Stearns on Yahoo here. The analyst who prepared the report put Yahoo as one of their top picks, citing such factors as signs that advertising pressure may be decreasing and initial concerns about Panama (the new Yahoo paid search platform) may have been unfounded.

Most interestingly he cites Yahoo as ripe for acquisition, mentioning Microsoft as a possible suitor. he believes that Microsoft have been actively investigating the possibility of acquiring Yahoo for some time. He also said that he could see any buyout price being at approximately double the current Yahoo share price. Now that has to be tempting for Yahoo!

If this ever happened (which I'm not yet convinced of) it would turn Microsoft into a major player in the online world, instantly buying them a serious amount of advertising real estate and with the potential to compete with Google Adwords in the paid search arena.

Now American Airlines has sued Google for allowing other advertisers to use it's trademarks as keywords in pay per click advertising. The airline accuses Google of selling the right to use American Airlines' trademarks and service marks or "words, phrases, or terms confusingly similar to those marks" to competitors who then direct searchers to their own web sites.

This isn't the first time Google has faced such a lawsuit. Geico sued Google for the same reasons some time ago and lost, and apparently other cases are on the backburner.

This confuses me a little... We use Google extensively for PPC advertising and our highest converting keywords are our brand terms (as you'd expect). Every so often we find a rogue affiliate or competitor bidding on our brand name and we always report this to Google and they remove the offending adverts for us. To enable this kind of response we had to register our brand terms with Google. They don't really police it actively but they do take down offending ads when asked.

So if the above is possible, why don't American Airlines just ask for them to be taken down? I'm guessing that they expect Google to do this automatically and to not even allow the ads to appear in the first place. To enable that would be a hugely complex and time consuming development for Google and a fundamental change to the Adwords system. I'm guessing Google would rather not have to do that. But if American Airlines lose (like Geico) then surely Google should not be taking down our competitors ads (as it's not been deemed illegal)?

Who knows! What I do know is that brand keyword advertising is very lucrative, it returns excellent ROI and is any search marketers meat and drink. Any threat to the way brand term advertising works could have a massive impact on Googles Adwords revenue. If lawsuits like this keep cropping up it is possible Google could ban advertising on trademarked terms for all to stem the tide of subpoenas, that would make PPC a much less attractive proposition!

Yahoo Search Marketing have published some tips for creating good landing pages that convert here on their blog.

Here's the lowdown, and very useful they are two (although maybe a little basic for some):

1. Connect the search experience to the landing page experience
   Wherever possible, use the same language on your landing pages as you do in your ads. It’s a real disconnect when you click on an ad that reads, “Online Conversion Rate Counter” only to land on a page selling a “Conversion Calculating Service.”
   
   
2. Integrate your landing page into your site
   Some advertisers make the mistake of building stand-alone landing pages for certain keywords that are more-or-less “divorced” from the rest of their sites. This can make your business seem sketchy to potential customers, who you want to be able to trust you with their credit card info. A consistent experience across all of your pages and product offerings can help create a more convincing experience. (More on this below.)
   
   
3. Gain their trust
   Use trusted, third-party security providers and make sure their badges and icons are clearly visible.
   
   
4. Offer tips and suggestions
   How can potential customers best use the product? If you’re selling steaks, offer a steak au poivre recipe. There’s a potential for up- and cross-sell here, as well. Perhaps monsieur would enjoy a nice bottle of cabernet sauvignon with his tender, juicy filet mignon, oui? Just don’t go crazy with it, mon ami. (See 5 and 6, below.)
   
   
5. Stay on target
   If your ad specifies John Deere tractors, make sure all of your tractors for sale on that page are John Deere tractors. In other words, if I had been looking for Caterpillar bulldozers I’d have clicked on an ad for them instead
   
   
6. Cut the clutter
   Your landing page should not be too generic and cluttered. This ties in with the tip above. If your ad is for discount wholesale 7Up, don’t clutter the page up with other un-colas. This helps keep the lead focused.
   
   
7. Ban the bling
   Your landing page should be cleanly and attractively designed, but avoid distractions like music or other audio, animations and revolving logos. These can distract prospective customers from their purpose, which is to buy the product or service that they need, hopefully from you. Again, keep ‘em focused on the task.
   
   
8. Give them something to do
   A little interactivity can help keep people engaged. For some products, especially big-ticket items, things like video testimonials and 360-degree tours may be good sales aids. Just let customers decide whether or not they want to view them by giving them control. And remember Tip 7: Keep the bling to a minimum.
   
   
9. Write right
   Language counts. Think of your landing page as a salesperson in a showroom. What would a salesperson say to a prospect to help “get to yes?”

Great tips for anyone either building landing pages or directing traffic to them!

It seems Yahoo has fundamental problems in their ad sales team (at least that's what I think).

Yet another quarterly profit report that's down on last year and again it's blaming sales of display adverts on the drop. However, everyone is reporting huge investment in online marketing and massive growth in this area. Yahoo have a major piece of internet real estate but just don't seem able to capitalise on it.

I realise a lot of the increased online ad spend is going into paid search with the likes of Google, but display should be Yahoo's meat and drink and shouldn't be an area they are losing money on. Yahoo provides masses of eyeballs for banner adverts but it seems the money is being held back to be spent elsewhere.

The solution? Capitalise on what you've already got! Huge traffic, massive amounts of quality content, huge amounts of page views. Create brand centric areas which can be sold for large amounts of advertising dough and fix Yahoo 360, turn it into a proper social network. Yahoo still has a huge community who use Messenger, Mail, Flickr etc. All these users have a Yahoo profile which could be a 360 profile, fix the social networking aspects (or build them if they don't exist) and you could get some loyalty back which in turn will attract the ad dollars back.

Google is fighting for the right to allow it's paid search advertisers to bid on trademarked keywords. This strange move seems to have come about thanks to Google's ongoing litigation with Rescuecom, the litigation has been ongoing since September 2004.

Google has filed a brief in the case this week which makes a compelling argument as to why sales of trademarked keywords to it's advertisers should be allowed. Google say that companies associate products with competitors all the time in other forms of advertising and that so doing doesn't cause confusion for customers - which is what a trademark is supposed to protect.

Google's lawyers say: "Generic brands are placed next to known brands on store shelves for the express purpose of diverting customers from the brand they are seeking to another, and their manufacturers pay for that placement,advertisers deliberately select magazine ad placements next to articles about their competitors. ... All manner of companies pay for coupon placements selected based on a customer's purchase of their competitors' products. And so on. Of course they are seeking to 'hijack' or 'divert' consumers who have indicated an interest in their competitors' products. That's the point of contextual advertising -- to target ads at consumers who are actively interested in your type of product, rather than indiscriminately at the world at large."

It's a fairly persuasive argument but in my opinion could spell trouble for Google if the rule changed. Trademark terms drive a huge proportion of our paid search traffic and it's the highest quality (and converting) paid search traffic as well (for obvious reasons). Diluting that (which any change would) could make Google a less attractive place to pump our money and make us move to other CPA alternatives even quicker than is already happening.

Yahoo's new paid search advertising system is being offered to new accounts now. Originally it was just offered to exisiting accounts in October.

Yahoo's counting on the new system as a way to grasp some market share back from Google. I believe they need more than just a new system. Simple issues such as preventing people from bidding on tradmark keywords would get Yahoo a lot more love from their advertisers.

However I do feel the main reason Yahoo can't compete with Google on paid search is due to their natural/organic search algorithm being so poor. Users go to search engines to find information, most of that information is found in the natural results so if the natural results are no good..... Without this core audience of searchers the paid results just don't get the volume of clicks and conversions that advertisers want from a pay per click campaign.

So we're in the web2.0 age and the web's advancing quicker than ever, new interfaces, social aspects, interaction of users with data etc etc. One thing that hasn't changed is the model us advertisers pay for things like price comparison websites, pay-per-click. Google has used pay-per-click for it's sponsored listings Adwords product sucessfully and I wouldn't imagine that will change, but for your average price comparison website which is supposed to deliver much more qualified users isn't it about time they moved to a cost-per-acquisition model?

Being in travel we use price comparison sites a lot and derive a lot of traffic from them although not a huge amount of sales. Moving to a CPA model will complement the work these sites are doing to integrate content into their offerings, they're trying to increase the quality of the visitors they send through to us and so should increase the conversion rates. Running on a CPA model could then prove to be in their interests as they may drive less clicks ultimately but with greater conversion. Staying on a PPC model would mean they will lose revenue rather than gain from all their hard work to optimise the listings.

With cookie tracking so easy to implement and fairly accurate, keeping a track of the sales isn't a problem and most people do this anyway. Moving to CPA will also remove any risks of click fraud as there will be nothing to be gained anymore.

As I said, I'm not sure Google would ever go down this route for Adwords, search is much more about driving high volumes of traffic and the visits are never going to be as qualified as those from a price comparison site. PPC seems a little old fashioned as a business model for a website that should be driving sales rather than purely traffic!

Clickriver is now in public beta. This is quite an exciting development from Amazon/A9 as they've chosen to build their own system to do this rather than syndicate Google Adsense or another solution.

The reason for going it alone is most likely because they really don't want any competing products displaying on their site. They're looking for complimentary advertising rather than competitive.

It will be interesting to see quite how much functionality there is in Clickriver. As a travel company based in the UK we'd want to only display ads on amazon.co.uk for example. We'd also only want our ads to appear when someone mentioned a destination in their search or were looking specifically at travel related products. So having this kind of functionality available to you through whatever interface Clickriver uses is really important.

As an official paid search fiend I'm quite excited by the prospects of this and it leaves scope for other companies to do similar. Tesco.com perhaps are big enough to do something like this.

When all others are predicting a downturn and slowing ad sales Google has turned in an amazing quarter yet again! Yahoo's quarter was less than inspiring, partly blamed on falling ad revenue, and other sources are predicting further slowing of ad spend but as yet it doesn't appear to have hit Google where it hurts.

Google have announced a doubling in third-quarter profit from a year ago with net revenue rising 70%.

That's impressive figures! So what is keeping it all steamrollering along? Well it seems to be PPC (paid search, Adwords). While the organic search results in Google are certainly getting worse, all the SEO's out there will testify to this) the paid links are booming, becoming easier to use for advertisers and becoming more relevant for users. All of this points to continued growth in this area.

Some are saying that even PPC will see a downturn, and yes, the volumes may drop a bit, but if managed correctly PPC is something that your company needn't slow down on. If you treat your paid search campaign as a cost of sale and always keep your average cost below a threshold where by you are still profiting from it then just keep going! Thats the beauty of paid search. You can monitor the results so closely and fine tune a campaign so much that any change in consumers spending can be adjusted for so that you don't lose out. It's a remarkable sales channel when managed effectively!

So while there may be a consumer slow down ahead the PPC revenue may slide a bit but I wouldn't see that causing Google any worries as it will always make up a sizeable chunk of their revenue. And with little competition coming from Microsoft and Yahoo (neither of their new paid search platforms are all that impressive) I think Google will continue to throw in record quarters for some time to come.