Website marketers cited Search engine positioning
was the top method to drive traffic to their sites
(66%), followed by email marketing (54%). Source:
Direct Marketing Association. Accordingly, the most
cost effective way to market your web site online is
to obtain several top 10-search engine rankings in
the major search engines for your keywords.
According to a recent Jupiter Research Survey,
searching on the search engines is one of the main
uses of the Internet among 79% of users. Source:
September 2002 Jupiter Research Survey. So that
being the case, whatever your promoting you'll want
to make sure it can be found on the first page of
the search engines results page.
The reason is numerically simple. An Iprospect
Survey in 2002 reported that
78% of web users abandon their search if the
first 3 pages don't provide an answer to their
question, and 28% don't scroll past the 2nd page of
results. Source: Media Post
article reporting results of Spring 2002 IProspect
survey.
Combine those facts with the Internet's explosive
growth rate of 1.8 Million people worldwide going
online every week for the very first time,
Source: Official Guide To Internet Promotion and
you can soon appreciate what a top 10 ranking can
mean to you.
Google receives approximately 39.4% of all search
engine traffic. Yahoo receives approximately 30.4%.
They're simply the largest search engines being
utilized online today.
Bringing up the rear is MSN at 29.6%, and AOL
15.5% then Ask Jeeves with 8.5%. Source:
Nielsen//NetRatings January 2004
How much traffic is that? Well, Google and its
partner sites were reporting a whopping 250 million
searches a day in February 2003.
Overture and its partners were reporting over 167
million searches per day. Inktomi reported 80
million followed by LookSmart with 45 million per
day.
FindWhat reported 33 million while Ask Jeeves
reported 20 million, Alta Vista reported 18 million
and finally Fast reported 12 Million searches per
day. Source: Searchenginewatch.com 2004.
With all said, you can easily see how your search
engine rankings are directly proportional to the
traffic your web site receives, and your site
traffic is directly related to your potential to
profit online.
Oh, and in case your wondering how much money is
spent online; a recent Forrester Research Report
indicated that online spending reached
$95,700,000,000 million in 2003! That's a cool 95.7
billion dollars. Projected online spending is
estimated to grow to $229 billion in 2008! A
whopping 139% increase in online spending!
Source: Forrester Research
Now with these facts in mind I'm confident you
can clearly see what a top 10-search engine ranking
can mean for your bottom line. Although it does
leave a question unanswered in my mind, what has a
higher ROI... organic search engine optimization or
paid search?
According to SEMPO's key analysis, the U.S. &
Canadian SEM Industry Size Estimate by tactic in
2004, organic SEO accounted
for 12% of the market share or $492,057,200 while
Paid Placement accounted for $3,341,878,176 or
81.8%.
Interestingly, 9 out of 10 respondents are
actively engaged in organic SEM marketing programs
accounting for 89% of the respondent advertisers.
This trend can be contributed to the average cost of
popular keywords continuing to escalate.
If the escalation continues to rise it could make
paid search engine
advertising exponentially cost prohibitive for all
but the largest advertisers... the 900lb gorillas!
Simply put, ROI is outpacing inflation: SEMPO's
key analysis indicates advertisers could afford to
pay on average 33% more for their keywords and
remain profitable, while they say prices have gone
up 26% on average in the last 12 months. That leaves
a 7% advertising margin to maintain current profits
for 2005!
SEMPO's data also noted that advertisers will get
smarter about managing their paid placement programs
before they cut back on spending.
This is also consistent with a report released by
Nielsen/ NetRatings indicating that the growing
demand for search engine advertising is outstripping
the supply of currently available advertising space.
These findings seem to indicate the inventory of
keywords is approaching a critical demand problem
however; most advertisers felt they still have some
degree of price flexibility in their paid placement
programs before they reach the threshold of
diminishing returns.
Is there any wonder why organic search engine
positioning has gained popularity for online
marketers in 2004? Could it be higher (ROI) return
on investments?
SEMPO also cites that 43% of advertiser
respondents have shifted their budgets away from
other marketing programs for Organic SEO.
So what does it all mean? Let the numbers speak
for themselves.
Organic SEO is undeniably gaining favor over the
lower ROI paid advertising. This is evidenced by
virtue of the fact that paid advertising is becoming
less profitable.
Although paid advertising will continue to hold a
large portion of the market share, as paid
advertising returns diminish and keyword costs soar,
my early 2005 forecast is for the materialization of
a progressive organic SEO market trend to facilitate
the need for advertising space.
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