This year I produced two video newsletters on search engine optimization (SEO) because search is still the dominant Internet marketing platform. Search engine optimization is a great place to start, but search engine marketing, that is buying contextual ads on search engines, is also a highly effective marketing strategy. In fact, over forty percent of all Internet advertising spending goes to pay per click (PPC) search advertising. The pay per click search marketing world is populated by three main players: Google AdWords, Yahoo! Search Marketing, and Microsoft adCenter. Google AdWords being by far the most dominant player. There are good reasons why SEM is the dominant form of Internet marketing. In fact there are three good reasons: context, intent and recommendation.
These three concepts form a matrix by which any form of Internet marketing can be evaluated. When you understand how these concepts inter-relate, you’ll see why search marketing is king of the Internet marketing roost.
Let’s start by reviewing the necessary and foundational principle of context.
As already mentioned, Google is the most dominant SEM platform. This is no surprise since they’re the most dominant search engine. So it only makes sense that they’d be dominant in search marketing too. But we should recall why they are the most dominant search engine. How did Google, a relative latecomer, beat out search engines that had established powerful brands like Yahoo! and AltaVista?
They beat them because they got relevancy right. John Battelle in his book The Search tells the fascinating story of how Google rose to power. In 1997 Larry Page and Sergey Brin were shopping their new superior search algorithm to all the main search engine players including Yahoo!. But one by one, they all took a pass. At the time, the search engine business model revolved around maximizing page views (to sell more banner ad impressions). Yahoo! was busy becoming a portal, keeping visitors inside their content properties for as long as possible. The idea of spending money on a better search product (which would only move people away from Yahoo! and onto their search results faster) was in direct opposition to their revenue model.
But as the search world would find out in dramatic fashion, searchers wanted relevant search results more than branded content. Google had superior search results minus all the spam results common to the other engines. They also had a refreshingly uncluttered interface. With nothing but a click to change search engines, users flocked to Google. And so better search results won the day. Of course, at the time, Google was sucking money for servers and bandwidth with no revenue plan in sight. Nevertheless, they maintained an obsessive focus on refining their process for relevant search results.
And a few years later this obsession would pay off. Because searchers would not be alone in their appreciation of relevancy. Marketers would come to value it too.
While Yahoo!, AOL, and others were attempting to make a living selling banner ads against page views, it wasn’t going well. That’s because banner ads, especially non-contextual ones, have abysmal clickthrough rates. And they are annoying as all get out. Banner ads from those days were garish, to put it mildly. They usually consisted of pulsating, seizure-inducing bright colors, and fake games enticing you to click a target to win a prize. They had to be obtrusive if they were to have any hope of getting clicked. There was a reason why these ads were so horrible. They had to overcome an incredible degree of consumer inertia. I’ve described the principle of consumer inertia, in a past newsletter. I’ll quote myself here to restate the principle:
“Online advertisements have a lot of work to do. As with any form of advertising, before an ad can even begin to accomplish its purpose (persuading you to buy something), it has to get your attention. The amount of work required to gain attention differs between media. For example, movie theater advertisements that run before the previews don’t have to work very hard. Assuming you’re not running out to grab a package of Jujubes, these ads pretty much have your attention. Television commercials have a bit more work to do since they have to compete with the refrigerator. Otherwise, television advertisements pretty much have a captive audience too. Magazine ads have a bit more work to do. Depending on whether you are seriously engaged in reading the magazine or simply flipping through as you wait for a doctor appointment, your reading activity will have a greater or lesser inertia. The relative scale of how hard it is to stop a consumer’s inertia is what makes online advertising so difficult. Unlike most of the other forms of advertising that tend to take advantage of captive attention, online advertising has to stop someone from active internet surfing, which has a lot of inertia. This is because nobody sits and watches their computer passively as websites pass by. Rather, they are online because they are pursuing a specific task or active interest. If someone is online to make travel arrangements, they are not going to easily change gears to respond to a banner ad selling a magazine subscription.”
To overcome this inertia, search banner ads had to virtually pluck our eyeballs out to get our attention. And even with such annoying tactics, the clickthrough rates were horrible.
Then came context, and context helped a lot.
When search ads had no correspondence with the context of a search, they had very little success. But when search results for “Hawaiian resorts” included travel ads for hotels in Hawaii, they performed much better. Of course Google was not the first to figure this out. AOL and Yahoo! enabled contextual search long before Google AdWords came along. But Google’s superior relevance in search results (not to mention enabling self-service with no minimum spend) created a superior contextual search marketing platform. Thus they were able to capitalize on their core product, great search results, with a valuable addition – contextual ads.
Context definitely changed the game. But is context enough for effective search engine advertising? I don’t think so. You can observe the weakness of mere context matching by comparing the performance of Google’s AdWords when displayed in their own search results versus when they’re display in the AdSense publisher network.
AdSense is Google’s advertising program for publishers. A local newspaper, for example, may want to maximize their site traffic without having to sell their own ads. Using AdSense they simply and add a bit of code to their site to display AdWords on their pages. These AdWords are also contextual. If an article is about Hawaii, the AdWords will be contextual to the content and display Hawaii oriented ads.
But the ads that are displayed across the AdSense network still show significantly poorer performance than the same AdWords when they are displayed among search results.
If context were enough, you’d think that ads that displayed on the web page would perform just as well as in the search results. But they don’t. Context is critical; it must be there; it’s foundational, but it’s not enough by itself.
Which brings us to the next, and perhaps more important concept: Intent.
Why do we search? What motivates us to fire up Google and start entering search terms? There are lots of reasons. We may be researching a future purchase, or just educating ourselves. We may be on a path of discovery, searching for new things to do, or places to go. Heck, we might just be looking up the lyrics to song we just heard. Or, if you’re me, we may just be checking our spelling (Google is a very friendly spell checker–they politely ask “Did you mean: Hawaiian?” when you enter your best guess).
Because we search for so many reasons, even the most relevant, contextual ads are not always effective. They’ll never be effective as long as we search without intent to buy.
Any search, whose goal is to merely research, learn, or figure out how to spell “Hawaiian” has no intent to buy anything. Contextual ads with offers for cheap hotels or package flights will always go unclicked without intent.
For search results to be be effective (and search ads too), they must have context, but searcher intent is also essential.
Gleaning a searcher’s intent is extremely important to search engines. And not just to improve ad performance. Understanding intent can improve organic search results too. Take this example from another past newsletter:
“It’s amazing what we expect from search engines. We enter a word or two and expect to find exactly what we’re looking for. Imagine talking to a librarian this way. I can just picture the perplexed expression on a librarian’s face if I were to walk up and just say ‘records.’ Would he point me to the music collection? Would he assume I was looking for the card catalog? He would probably have to ask some clarifying questions. ‘I’m sorry sir, what kind of records are you looking for – Jazz, Rock, Bluegrass?’
I’d restate my request, ‘making records.’
Still puzzled he’d say, ‘Hum, well we have some accounting books that have good ideas about keeping your files in order…’
‘How to set records,’ I interrupt.
‘Are you looking for the Guinness Book of World Records, or sports related records?’ he might ask.
‘How to set records in a database,’ I’d clarify.
‘Oh, those kinds of records,’ he’d say with relief, ‘the computer books are over there but there are a lot of them. What kind of databases are you interested in?’
We would never presume that a librarian would understand vague ambiguous requests. Yet we often throw such words and phrases into search engines with little clarification. All a search engine has to go on is the words we give it. And it doesn’t even have the opportunity to ask clarifying questions. No matter how abstract or unclear our request, the search engine has to respond with something.
But if the engine had a little more information to go on, beyond just the words we give it, it might be able to provide better results. For example, if, while I approached our bewildered librarian to ask for ‘records,’ I was wearing a U2 T-shirt, and was listening to music on an MP3 player he might glean that I’m looking for record albums. Likewise, if I were whacking a paddle ball game while balancing a chair on my nose he might conclude that I was interested in setting a word record. Or, if I had thick black glasses, a pocket protector, and a laptop under my arm he might guess I was looking for information about database records.
Unfortunately, search engines don’t have any of this auxiliary information available to them. That is, unless we give it to them.”
Search and search advertising require context – it’s foundational. But context alone does not usually result in a click, a conversion or a sale, because context alone doesn’t take into consideration why a person is searching.
And search engines like Google are actively trying to improve their ability to glean intent. In fact, one way they are trying to do this is by storing our past search requests. They use this past search history to learn about us as individuals. I wrote about this in our newsletter Number One in Google? Not for long! If they can understand our personal profiles, they can guess better at our intent and improve their results. Intent makes a huge difference.
And that’s why AdWords, when displayed on search results pages perform better than AdSense ads displayed on contextual publisher content sites. Search engines have a much better chance of presuming intent.
We don’t usually first go to a newspaper site or blog in order to establish our travel plans. In those places ads are incidental to our activity. But we often go to search engines with such intent. And when you combine context with intent you have a very powerful combination. Matching context and intent is rare. But it occurs most often in the context of search.
Let’s run a few examples of how different kinds of search phrases imply a lesser or greater degree of intent.
Let’s suppose we own a hair loss clinic and want to drum up some business with search advertising. We might be inclined to set up an AdWord campaign bidding on the phrase “hair loss.” But this phrase by itself does not necessarily imply any intent. For example, if I were to type “causes of hair loss” into Google my ad might show up, but the full search phrase does not imply that I’m looking for a hair loss clinic, just that I want to know why I’m losing my hair. But if I type in “hair loss clinic,” my intent becomes more evident.
Here’s another example. Suppose I sell used cars and want to promote cars that get high gas mileage. The phrase “gas mileage” would not be a good choice. There are any number of reasons I might include the phrase “gas mileage” in a search request, researching how to maximize my current vehicle’s gas mileage for example. But the phrase “fuel efficient vehicles” demonstrates a bit more intent on my part to find a fuel efficient vehicle. Or better yet, “used car, hybrid” would be a phrase full of intent.
When I run AdWord campaigns for Newfangled, I don’t get results from the phrases like “website development.” That’s because someone searching for information on “website development” is more likely to be a website developer (or an aspiring one) than a client looking for a website developer. And, in fact, the phrase “website developer” is a much better choice because I can presume that people searching with that phrase are more likely to have the intent to hire a website developer. Or better yet, the phrase “website development pricing” shows significant intent to find and hire a web developer.
Combining context and intent is a powerful marketing event. And search is one place where content and intent often meet.
Meeting a consumer at the point of context and intent will likely result in a click, a conversion or a sale. But if you add one more factor, you can really seal the deal.
When a search event combines both context and intent a powerful opportunity arises. As a consumer I find what I’m looking for and for a merchant there’s an opportunity to sell. But when context and intent meet, there is still one more hurdle to overcome. Choice. There’s usually more than one option that will meet the context of a search and a searcher’s intent. There is one more search factor that can narrow the field of options. Recommendation.
Recommendation is the final factor that makes search the powerful marketing platform that it is. I’ll use a real example from my search history to demonstrate. A couple years ago it was time to buy a new mp3 player. I had intent, and no doubt my search for “portable mp3 players” delivered many options that met the context of my search. But there are many mp3 players to choose from! Which one would I choose? iPod, Zune, Creative MuVo?
In the offline world recommendations help us a lot. Our buying decisions are often influenced by the recommendation of a informed friend or a trusted expert.
Is there an element of recommendation in search? There is!
When I was searching for an mp3 player I found lot’s of options. But when I thought to check which mp3 players work best with Rhapsody (my online music service), I discovered an interesting change in my results. Suddenly, SanDisk’s Sansa was prevalent in both the AdWords, and the organic search results. Google’s search algorithm linked Rhapsody’s service with SanDisk’s product. This was a form of recommendation. In fact, we all tend to give Google search results a fair amount of credibility when it comes to recommendation. (Why else would any of us care about our site showing up in the top of Google results?) Upon further investigation I discovered that the Sansa was indeed a common accessory to the Rhapsody service. And I bought one.
When you set up shop at the intersection of context, intent and recommendation, selling is almost inevitable. Which is one reason you want to give appropriate attention to both search engine optimization and search engine marketing, since both efforts can complement and magnify each other.
By the way, the power of recommendation is what is driving much of the business interest in social media. Aggregating massive numbers of personal profiles can potentially integrate a powerful recommendation factor into marketing. But most of the experiments in this area are still a ways off from working effectively. For example, I wrote about Facebook last November and started a Facebook ad campaign to test the waters. I can confirm that Facebook ads do not perform nearly as well as AdWords. While they have a strong recommendation component they don’t often meet people at the point of intent.
Using these three factors: context, intent, and recommendation, can help you to evaluate any potential online marketing opportunities. When the three align you have a powerful marketing opportunity. And search is a unique platform where they do frequently converge.