The search engine marketing industry is consistently evolving, sometimes at a pace that makes it hard to believe that search engine marketing services can stay on top of all the latest developments. The one constant for search engine marketing firms, and for the industry in general, is change–usually for the better, sometimes for the worse, but almost always significant. The industry is not for the faint-hearted or those who abhor change. However, savvy search engine marketing firms try to look ahead to anticipate trends. Here are my predictions of issues that search engine marketing services will face in the short term.
More Accountability Demanded from Search Engine Marketing Firms
Search engine marketing firms that use tactics designed to trick the engines into showing results that aren’t directly addressing the search query will struggle, as more companies begin to look at the larger goals that lead them to investigate search engine marketing services in the first place. The “traffic-centric” mindset will evolve as companies begin to demand accountability from search engine marketing firms in terms of bottom line increases. Ranking increases delivered by search engine marketing services will be questioned if they do not lead to significant traffic increases, and traffic increases will be questioned if there is no subsequent increase in business generated from the website. This is a good thing for quality search engine marketing firms, since the “snake-oil” practitioners that have given the industry such a bad name will never be given serious consideration by any company that does its homework in the vendor selection process.
Rising PPC Costs and Increasing PPC Frustration
As larger companies with huge budgets continue to jump into the pay per click (PPC) arena, costs will continue to rise. (Average PPC costs have increased 37% from Q1 2005 to Q1 2006.(1)) These well-funded companies will use PPC as a branding tool as much as a sales tool, which will squeeze out many of the current smaller advertisers. In fact, the top 10 PPC advertising companies, based upon the number of PPC impressions, include such names as eBay, NextTag, Vonage, Time Warner, Orbitz, Target, and Yahoo.(2) More large companies will continue to join the fray, many of them throwing ROI out the window and bidding high prices for desirable keyphrases for the sake of branding. This means that search engine marketing firms will find small- to medium-sized companies turning to SEO to achieve results when they no longer can afford PPC.
Increased Interest in Organic SEO
While PPC costs rise, there is also a trend that no doubt disturbs the engines that offer PPC programs. Sixty-six percent of consumers “distrust” paid search ads.(3) Up to 85% of searchers say they “tend to ignore the paid listings”(4), while 87% of commercial clicks take place “on the natural (not sponsored) search results.”(5) Three times as many marketers who outsource the management of their natural SEO to search engine marketing firms and who also participate in pay per click advertising recognize a higher ROI from their search engine marketing services than from PPC.(6) These facts, coupled with the fact that Google has recently announced that it will begin to take the relevance of pages into consideration when deciding in what order the ads will appear (which will mean that effective PPC campaigns will need at least some basic organic SEO), point to one obvious result–an increase in the number of companies that investigate organic SEO programs, whether internally generated or provided by outside search engine marketing firms.
Continued Reluctance from Agencies to Pursue Search Marketing
To most, it seems like a perfect fit–traditional advertising agencies joining forces with (or purchasing outright) PPC providers and organic search engine marketing services. However, the average agency is scared to death of search engine marketing services in any form (although some forward-looking agencies have finally jumped on the search engine marketing bandwagon). The reasons are simple: accountability and metrics.
Advertising agencies have for years made money based upon a percentage of what a company spends on advertising. This model has been the accepted norm for decades. However, it raises some ethical issues. What is the motivation for an agency to recommend decreased spending on non-performing initiatives? Moreover, what reasons does an agency have to report on the effectiveness of each of its campaigns? (If an agency’s clients dug deeply into any such metrics, they would likely reduce their advertising spend based on the performance of individual campaigns.) Many PPC service providers have adopted this model, even though the goal of a PPC campaign should be to monitor the metrics of a campaign to decrease the spend (eliminating underperforming keyphrases, for example).
Good search engine marketing services offer metrics that scare traditional advertising agencies. If these agencies were to present such metrics to their clients, those same clients may start to demand similar metrics for other campaigns (television, radio, magazine ads, etc.). Until the “percentage of spend” model is altered, large agencies will continue to reject search engine marketing services and will not recommend them to their clients.
Continued Focus on Google for Organic SEO
In general, where Google goes, other engines will follow. Smart search engine marketing services will continue to optimize for Google, which currently accounts for half of searches in the United States.(7) However, instead of trying to trick Google by unraveling the latest, ever-changing algorithm, search engine marketing firms will instead need to use the “piggyback” approach. This approach entails learning from the extensive studies that Google conducts of its users (learning by observing the commonalities of the types of sites that consistently rank highly) and applying those same attributes to client websites. In this way, search engine marketing firms not only make sites better for Google, but also for users. As other engines try to close the relevancy gap in search engine results, search engine marketing firms will be rewarded as the tactics they have used for Google success become the accepted industry standard.
The use of search engine marketing services is still a new, “unproven” channel to many companies. Even so, it is changing the way that many traditional advertising agencies must do business. With PPC costs on the rise, and the effectiveness of the PPC channel coming into question, more companies will investigate the hiring of search engine marketing firms using organic tactics for their Internet marketing needs. Smart companies that outsource organic or PPC advertising will no longer say “what have you done for me lately”–they will say “prove what you’ve done for me lately.” Search engine marketing services that are on top of the curve will be more than happy to do so.
1. Doubleclick, Performics 50 Search Trend Report
2. Nielsen/Netratings, 2006
4. 2005 Marketing Sherpa Study
5. Jupiter Research, 2005
7. LaMonica, Paul R. “Yahoo, Google Search for Fans on Wall Street.” CNN.com, 14 July 2006, http://money.cnn.com/2006/07/14/news/companies/yahoo_google/index.htm.