Table of Contents. The Shift from Traditional to Online...2. Shopping Domino Effect...3. Saying Goodbye to Old Ways...4

Transcription

1 1

2 Table of Contents The Shift from Traditional to Online...2 Shopping Domino Effect...3 Saying Goodbye to Old Ways Reasons Companies Make the Shift...5 Search Marketing ROI Case Study...7 Final Thoughts...8 1

3 The Shift from Traditional to Online Search Marketing If someone gave you $2 for a dollar bill, would you do it? Probably every time, right? How about $25? If someone told you they d give you $25 for just a dollar bill, you wouldn t believe them. In the end, that s why more people are making the shift to search marketing, because the return on investment is really that big. Return on Investment is the judge of every marketing endeavor. The economic troubles in recent years have forced companies to closely observe every move, to count every penny, and to make sure each spent marketing dollar brings more dollars back, or in other words, delivers a big return on investment (ROI). As a result, marketers have become more selective in choosing measurable strategies that prove ROI. Many have forgone expensive, traditional advertising methods with ambiguous results for online marketing, which can be tracked, dissected, measured and analyzed much more efficiently. There has been a noticeable shift in marketing strategies and marketing spend. Online search marketing is becoming the go-to, primary strategy while traditional advertising is now getting the leftover crumbs of the marketing budget. This whitepaper will include third-party statistics from SEMPO, emarketer and Forrester, as well as SEO.com s own observations, which detail trends and paint a clear picture of this shift in marketing. At the end, more than 80 of SEO.com clients are used as a case study for showing the ROI of search marketing. 2 Measuring the ROI (Return On Investment) is the number one challenge marketers are facing this year. SEMPO s State of Search Engine Marketing, 2010

4 US Search Engine Marketing Spending (SEO, PPC, etc.) $25,000 $18,000 Millions $18,102 $14,110 $23,380 Shopping Domino Effect There are 14 billion online searches every month, and emarketer claims more than 74% of U.S. households will have Internet access in With that number rising every year globally, millions more are shopping from their home through a computer screen. Shopping online seems commonplace today, but it s really just in its infancy. Giant ecommerce sites like Amazon.com are now household brands that seem to have been around forever. $12, Source: February 2009 US B2B Media Spending, (Millions, % increase over prior year and share %) Total Spending* $22,285 $23,688 $25,131 $26,740 $28,358 $30,172 Online Ad Spending $1,537 $1,951 $2,431 $2,912 $3,410 $3,939 Online Ad Spending Growth 24.9% 26.9% 23.7% 20.7% 17.1% 15.5% For a dose of perspective, Amazon.com first launched its website in 1995 only 15 years ago and now earns an annual revenue of more than $24 billion. Marketers are paying attention. Forrester Research said marketers will spend $26 billion in 2010 in search and online marketing, which rivals all spending on cable/satellite TV and radio. And almost half of all marketers plan to increase online ad spending by decreasing spending in other channels. Online Ad Spending % of Total 6.9% 8.2% 9.6% 10.9% 12.0% 13.1% 9 % Companies SEO Spending in 2010* Note: *includes B2B magazine, trade shows and exhibitions, online advertising and online content & communities. Source: Veronis Suhler Stevenson, PQ Media, AdScope, Agricom, American Business media, BPA International, Center for Exhibition Research, IMS/TheAuditor, PERQ, SRDS, TNS Media Intelligence/CMR, Tradeshow Week, September 2006; emarketer calculations, November % % Expect to spend more on SEO Expect to spend about the same Expect to spend less 3 * Source: State of Search Engine Marketing Report 2010 in association with SEMPO

5 Companies Saying Goodbye to Old Ways With so many plugged in and a shopping online for almost every product and service, marketers have responded by pushing more of their budgets online and away from traditional strategies. Print advertising has seemed to take the hardest hit, and direct mail being a close second. % of Companies shifting money from traditional marketing to SEO* 49 % Print Advertising 36 % Direct Mail 24 % Conferences & Exhibits 11 % 8 % 21 % Yellow Page Ads 18 % TV Ads 20 % 17 % Radio Ads 4 61 % Average Company Budget for SEO* Up to $75,000 $75,000 - $250,000 $250,000 - $3 million Will spend nothing on SEO * Source: State of Search Engine Marketing Report 2010 in association with SEMPO

6 The 3 Core Reasons Why Companies Make the Shift The reason more and more companies are investing more and more money into search marketing is because of three main differentiators over traditional strategies: It s targeted, it s measurable, and delivers a high ROI. Targeted Every month, there are 14 billion online searches. Many of those searches are for products and services. Each industry has keywords that are searched on thousands of times. Top rankings in the search results will capture a massive demographic that is looking to buy specific products. 90% of people click on the first page of the rankings, especially the top 3 results. A big difference between traditional marketing/ advertising and digital, is search marketing directly hones in on a demographic of customers who are looking to buy a specific product. While traditional reaches a vast, ambiguous audience, search marketing reaches the right customers at the exact moment they want to buy. Traditional marketing is like blindly casting a wide net. 10 % 4 % 13 % 56 % of users click the 1st search result 5 * Source: Cornell University Eye-Tracking Analysis

7 3 Reasons Why Companies Make the Shift Measurable Tracking the effectiveness of marketing dollars has always been the bane of advertising and marketing departments. It s difficult to track how billboards, print ads and TV commercials bring in customers, and if sales are a direct result of traditional marketing campaigns. 49 % The top measurable results companies use to gauge the success of SEO* Site Traffic That s why marketers are singing praises to the online marketing, and particularly analytics. Whether it s PPC, SEO, Social Media, or Conversion Optimization, through analytics, you can track how a particular campaign directly influences website traffic, leads, and sales. Everyone involved can see the statistics and can change plans to improve performance. It s something never dreamed of in traditional marketing. SEMPO s survey revealed what companies measure to gauge the success of their marketing campaigns. On the right is just a snapshot. The top two were site traffic and the conversion rate. This information gives marketers an extra weapon to tweak their campaigns if needed, and to prove their success something traditional marketing is not able to accurately provide. 42 % 37 % 32 % * Source: State of Search Engine Marketing Report 2010 in association with SEMPO Conversion Rate Number of Sales/Leads 49 % Position Click Through 6 Digital marketing offers compelling benefits, especially for cash-conscious companies. Marketers can more readily measure the results of Internet advertising than with most traditional media. This produces more-efficient advertising and higher ROI, which in turn pushes traditional media to compete with lower pricing. emarketer

8 3 Reasons Why Companies Make the Shift Return on Investment (ROI) Return on Investment might be the biggest reason marketers are turning their attention to search marketing. In its brief time of existence, search is quickly proving to deliver the largest ROI when compared to traditional. companies that devote at least on-half of their budget to online inbound marketing, compared with companies spending at least one-half of lead generation dollars on outbound tactics. The average cost per lead from inbound marketing was also significantly less. Good search marketing campaigns achieve a balance between SEO, PPC, Social Media, and conversion strategies that drive website traffic and turn that traffic into sales. When each of those strategies blend together perfectly, website revenue increases dramatically. But the questions really are, What is the entire ROI of search marketing? When I invest a dollar into good online search marketing strategies, how many more dollars will I get back? Hubspot, an inbound online marketing platform also agrees, especially when it comes to lead genereation. Its 2010 State of Inbound Marketing report stated that spending on lead generation is 60% less among Average cost per lead in North America $332 Outbound Marketing i.e. advertising, trade shows, seminars, marketing, cold calling, telemarketing $134 Inbound Marketing i.e. SEO, PPC, Social Media, Landing Pages, Blogging, Conversion Optimization Source: HubSpot, 2010 State of Inbound Marketing. February 16, 20 7

9 ROI SEO.com Case Study To determine search marketing s ROI, SEO.com dove deep into its past clients successes and failures. Eighty-four clients that had been with SEO.com for 6 months or more agreed to share information. Results varied by industry, size of company and time with SEO.com. Generally, those that stay with SEO.com longer had better results. The top two clients were left out to avoid skewing the average. While this only includes the ROI of SEO.com s clients, it should also reflect results for any company that uses good search marketing strategies. As of April, 2010, SEO.com has obtained first-page rankings for 773,971 keywords that continue to drive traffic and revenue. The clients were each given a custom strategy using SEO, PPC, Social Media and Conversion Optimization, which resulted in a return of about $25 for every $1 spent. SEO.com s Clients Results for Search Engine Optimization Average Increase in Traffic 60 % Average ROI 2,479 % Average Increase in Monthly Conversions 113 % Average Increase in Keyword Referral Traffic 161 % 8 On average, every dollar spent on SEO.com s services yields $25.

10 Final Thoughts With an average ROI of almost 2,500%, and a strategy that can be tracked and analyzed to help a company evolve strategies and improve, it s no wonder there is a prominent shift in the marketing world. Of course, these types of numbers are only achieved if you work with credible professionals that know how to guide each campaign. All SEO and online marketing companies are not created equal. Make sure to do your research before choosing an SEO company. If you are interested in a proposal to see how your site is doing and what we could do to improve you search engine rankings, website traffic and revenue, contact us today. Contact Us p: e: info@seo.com 9