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Organic (free) or PPC (Paid) search engine
results - which is cheaper?

Site placement research results

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Added October, 2007:

Report Finds: Paid Search Is Not Much Better At Turning Shoppers To Buyers

The study's authors said the results showed that companies using online advertising should use a combination of online marketing tools.

Paid search has only a slight advantage over unpaid search in converting online shoppers to buyers, a Web analytics firm said Monday.

A study of business-to-consumer e-commerce sites during the first eight months of the year found conversion rates for paid search was just 9 percent higher than unpaid search, WebSideStory said.

Keywords bought on a pay-per-click basis at search engines such as Google, Yahoo and Microsoft MSN had a median conversion rate of 3.4 percent, compared with 3.13 percent for unpaid results to search queries, the firm said. Both forms of search were far above the overall conversion rate of about 2 percent for most e-commerce sites.

The study's results did not indicate that paid search wasn't worth the money, rather it showed that companies using online advertising should use a combination of available online marketing tools, including banner ads, paid search, email marketing and search engine optimization techniques.

"Most people don't understand that to get high conversion rates you need multiple touch points," Rand Schulman, chief marketing officer for WebSideStory, said. "It's not just one or the other."  Using optimizers has more long-term results.

By Antone Gonsalves, TechWeb URL: http://www.informationweek.com/story/showArticle.jhtml?articleID=193005490


Posted: September 29 2005
  
The following was written by J. Hedger

Search advertisers are offered two basic marketing models, paid-ads (PPC) and free organic ads.

While there are advantages and disadvantages to both models, one clearly stands out as a better advertising option than the other. Why is it then that advertisers from small business to mega-corporation tend to show higher interest in the more expensive and least effective of the two?

Most SEOs speculate that advertisers understand paid-advertising (PPC) better than organic placement. As much of search marketing is conducted in-house and optimization is a learned-skill, corporate marketing departments lean towards the very simple model of paid-search (PPC). Organic search engine placement continues to be perceived as a nebulous service that can take time to show results. On the other hand, paid-ad (PPC) placements tend to show up minutes after they are established and bidding one's way to top spot is relatively easy.

With search ad-spends sometimes topping five or six figures per month, many SEOs shake their heads at businesses that refuse to invest a much smaller (generally low to mid four figure) sum on organic optimization. Ranging from small to mega sized operations, the number of paid-ad (PPC) advertisers that ignore organic optimization seems to be growing.

Over the past three years, independent research has consistently confirmed that search engine users tend to click on the center column organic (free) ads far more often than on paid ads (PPC). Earlier this year, search marketers benefited from a number of published studies that clearly demonstrate the higher value of organic placements. While the results of this research is easily available to all, traditional and tech media stories tend to focus on paid-search advertising (also known as PPC or Pay per Click).

Two studies that made an enormous impact on the search marketing field this year are the Eye Tracking research conducted by Enquiro CEO Gord Hotchkiss and a whitepaper published by Lisa Wehr, CEO of OneUpWeb titled, " Target Google's Top Ten to Sell Online." Gord's study shows the basic F (or triangular) shape search user's eyes tend to follow when examining search results. Lisa's study found that search users are up to 6X more likely to click on the first few organic results as they are to choose any of the paid (PPC) results.

A third study, " Accurately Interpreting Clickthrough Data as Implicit Feedback " , released earlier this week by Cornell professor Thorsten Joachims looked at the links users found on search engine results pages and questioned why they choose which link. The results show again the importance of high organic search engine rankings. The researchers asked subjects to perform searches and looked at which results they viewed, which they clicked on, and what happens if those links are mixed up.

The Cornell study found that search users tended to view (look at) the first five organic results with a high percentage of them (approx. 2/3) viewing the top two listings with 42% of them selecting or clicking on that link. The number of search-viewers halves to approximately 1/3 of users viewing sites appearing in positions 3, 4 and 5. The numbers drop to about 1 in 10 users tending to view the 9 th and 10 th placed sites.

When a search user views search listings, it doesn't necessarily mean they click on those listings. In this context, to view means to examine. Users tend to examine the text used to phrase the reference link as well as the descriptive paragraph appearing beneath the link before deciding to click on it. This is especially true for the smaller number of searchers who view listings found in the 3 rd to 10 th positions as users who examined those listings tended to spend more time on the results page before choosing the link to click first. In other words, 1/3 to 1/10 of users are conducting preliminary research by seriously reading the text used to phrase the results before clicking.

This finding was backed up in another part of the Cornell study that showed when the same Top2 results were reversed, the text used in the link and description had a notable influence on which link the user clicks. The research found that when results were switched around, 34% of the users would still click on the site ranked in first place, even when they had seen the now #2 site there earlier.

In his Alertbox review of the Cornell study, Jakob Nielsen succinctly notes, " If users always clicked the best link, then swapping the order of the two links should also swap the percentages, and this didn't happen. The top hit still got the most clicks."

These findings led the research team to suggest there are two biases playing out in the minds of search engine users. The first is the Trust Bias, which leads the searcher to believe that a site ranked in the number 1 position is there because it must be the best reference for that keyword. The second is the Quality Bias, which considers the text used in the results to determine which is the best site to choose from.

For search engine marketers and more importantly, search engine advertisers, there are two glaringly obvious implications.

First of all, it is extremely important to be found at the Top of the search engine results. Being in the Top10 is likely sufficient for many businesses but the sites getting the most business are found at the top. To further these findings, Gord and Lisa's research clearly shows that searchers are choosing organic placements over paid-ads (PPC).

Secondly, the copy used in your Title tag and site content has to be more compelling than that of your competitors. Search users are reading before clicking. If they have to make a choice between three sites that are all perceived to be equal (those in the 3rd to 5th positions), they will almost always choose the one with the most topically relevant descriptive text and link-copy.

Put together, the results of the three studies show that search engine users are able to tell the difference between paid (PPC) and free (organic) listings and tend to trust the free organic listings more than they do the paid (PPC) ones. The studies also show that search users, while still tending to put a higher bias on the Top5 results are becoming sophisticated enough to seriously consider descriptive copy before choosing to select a link. In other words, the search users are starting to make what appears to them to be the wisest choices when selecting search advertising. The advertisers are advised to do the same.

(Jim Hedger is a writer, speaker and search engine marketing expert based in Victoria BC. Jim writes and edits full-time for StepForth and is also an editor for the Internet Search Engine Database. He has worked as an SEO for over 5 years and welcomes the opportunity to share his experience through interviews, articles and speaking engagements. He can be reached at jimhedger@stepforth.com.)


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#: Time is also money. Author: kgun, Location: Norway Posted: September 29 2005
    
"Search advertisers are offered two basic marketing models, paid-ads (PPC) and free organic ads."

They call it free organic ads, but how free is it if you consider the amount of time used to get into the top ten position?

The paid (PPC) may even be much cheaper.

How many found gold in the Klondike Gold Rush?
http://www.nps.gov/klgo/

The internet medium (industry) is young. But less then 10 % of the sites on the internet make money, money to pay their employers or feed their owner. As it matures, it will in my view (but I may be wrong), be more and more difficult for a new startup company to succeed. And advertising may be more expensive. A TV ad is very expensive, and not for small companies in Norway. I do not know how it is in other countries.

Conclusion:
1. To succeed with "free" organic Ad on the internet in the future, you have to invest more and more of your time in learning the different SEO techniques.
2. More and more of Ad words will be bought by companies with a large (huge) Ad budget.
3. As always, the small fishes will feed the big sharks.


#: Small fish do well if they know what they are doing Author: seofan, Location: Columbia SC and Raleigh NC Posted: September 29 2005
    
Most businesses are wanting to get off of PPC. They were losing or breaking even - which is still not growing the company profits.

Case studies we have show that sales and traffic reflect the profitable reach that "organic" placements have in search marketing. Quite a few businesses have placements in the top 1-5 that number in the 400 to 500 placement range opposed to the 4 or 5 key phrases in one or two search engines they were able to afford under PPC. Visitors respond more, find them easier, and buy more. The statistics show it.

In all cases, client's PPC costs are eliminated. On the average, a full hands-on SEO only cost about 1/3 of the previous PPC arrangements. Statistically, the traffic averages a 40-50% increase and properly analyzed, and targeted key phrases based on products or services yield increases of sales proportionate to increase in traffic (industry types do affect demand for specialty items and has to be taken into consideration. All case studies reflect statistics that range from at least 1 year to over 6 years in organic SEO campaigns. Properly managed, the increase and expansion carefully improves. Of course, plateaus can be reached, but then creative expansion begins to further develop SEO results as time goes along.

After 9 1/2 years in this line of work (and yes, I'm an InfoSEEKer that started long before we established SEO as an "industry"), I have yet to see a solid example of PPC that has been a true success except in the most outrageous of situations such as the adult industry or specific travel industries.

I have seen the head shaking and nay-saying from CEO's concerning paying for TRUE organic SEO campaign management. I have also seen them sign for the PPC campaigns at 10 times the monthly sum or more. My observation is that PPC is following the same format as traditional advertising. You pay for an ad and it gets published. There is a "perceived" tangible. With organic SEO specialist campaigns, unless the specialist has years of case studies, stats, current clients that have had organic SEO for years and other things that truly PROVE results in organic placements, the organic campaign seems more of a gamble.

Good organic SEO specialists take the time to try to educate each potential client. This is a lengthy and time consuming process in itself.

Should a potential client business still choose to go the PPC route to see "instant results", etc, it usually takes a year of outrageous PPC campaign fees that barely break even with sales before the lesson concerning organic SEO positioning is driven home.


From: www.webproworld.com

 

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