I attended a session today about Search Behavior where Inquiro, and Peformics presented their latest studies on how people are using the search engines and their affect on site traffic and customer buying behavior. (Keynote also presented a study, but I found very little of it to be relevant). Here are some of the very interesting takeaways:

Inquiro’s Study

• Contrary to their prior beliefs about the importance of titles and descriptions, Inqurio’s study found that the only statistical relevant predictor of driving traffic volume from Google searches is your rank and page position.
  
• Inquiro’s study employed some very interesting eye tracking technology from eyetools which let them see exactly where people were looking on the page, for how long, and where there eyes went next. From this they have defined what they call “Searches Golden Triangle”. This is the top left portion of the screen where customers quickly scan from the top down for relevant information, if their eye catches something relevant they will quickly scan to the right to verify. From a paid search perspective on Google, it highlights that the most important spots would be Google’s two top sponsored link’s that appear above the searches as opposed to the ones that show up on the right hand side. I will try and get a copy of their slide that shows this but in ascii characters it would like something like this:

  XXXXXXXXX
  XXXXXX
  XXXX
  XX
  X

• Inquiro’s study further showed that if searches didn’t find what they wanted in their first “F Scan” at the top of the page, 60% would scroll down and repeat in the organic searches, while 40% would start a vertical scan from the top of the sponsored links on the right hand side. Eye tracking tools showed that only the top 1-3 ads were relevant, with 50% going to the top, 30% to number two, and then quickly dropping down to less than 10% seeing the bottom 3 ads on a page.
  

Performics’ Study

• Performics’ study took a look at 30 e-commerce sites and then looked at cScoreData for people who purchased from those sites and relevant keyword searches they had done leading up to the initial purchase. They found that 50% of all buyers made a relevant search before their online purchase.
  
• There was an average of 4-5 searches prior to purchases.
  
• Their research showed that most searches started off as searches on generic terms, and most buyers never searched on a brand term.
  
• When buyers who searched on branded terms tended to search on these terms later in the purchase cycle, just prior to making an online purchase, which may be why some ROI tools show branded terms converting at higher rates than generic terms. A special note, that many of these buyers were introduced and “pre-sold” on a specific brand from the prior generic searches they had performed.
  
• 55% of buyers did their last relevant search more than 2 weeks before the purchase.
  

This was a very interesting session, and I had a few takeaways from this that I think are extremely relevant to companies doing paid search and search engine affiliate marketers:

1. For companies paying for their own search campaigns, it is important to take a full view of your ROI. If you are only looking at short term click conversions that you may be quickly out spent by competitors who are able to see long term click trends and conversions and offline buying behavior driven from search.
   
2. Affiliate marketers should review the cookie periods that their merchants are providing. Anything less than 30 days means that you are probably directly driving sales that you should be getting credit for.
   
3. Affiliate marketers may also want to stay away from companies that are only willing to let you bid on generic terms, because these generic terms may be driving a significant number of “pre-sales” behavior that is then turning into branded searches just prior to the customer making the online purchase. If the merchant is reserving these high conversion ads only for themselves, and overwriting affiliate cookies when customers click on their own paid search terms, then they may be taking credit for the sales you are playing a large role in generating for them.
   
4. Finally, with the relationship between generic searches early and branded searches later in the process, are your ROI tracking tools only looking at the last click, or can they show the full cycle of clicks?
   

   It’s all rather thought provoking and is worth thinking about and spurring further discussions.

   Adam
   

Today marks the kick off of Jupiter’s Search Engine Strategies Convention in New York City. I will be on site and hope to post updates and interesting information that I take away from the sessions and events that I attend.

This morning I attended a session on the search engine landscape with presentations from comScore, Hitwise, and Neilson NetRatings. All presenters spoke quickly about their user tracking methodologies and then went into current findings. Here are some quick takeaways:

• Google still leads with approx 50% market share
• MSN is gaining on Yahoo for the second place spot and the industry is watching closely to see what Microsoft will do with their desktop position and large marketing muscle.
• Google is very dominant in European markets.
• Companies need to take a broad ROI prospective to measure the true value of their search engine marketing efforts. These tracking companies are showing that conversions can take place 30-90 days out and even longer. Additionally, companies must find ways to measure how search effects offline transactions to gain a full picture. ComScore noticed that in the electronics space, as much as 90% of conversions actually occur offline.

The next few days should be interesting with all the sessions and impending snow storm in New York.

Adam

Paul Kedrosky hypothesizes that there could be a financial model built around the trend in category keyword prices and the stock market segment.

Interestingly enough, I have had several calls from investment firms and hedge funds over the past few weeks trying to understand the changing policies of Google and how they might affect companies future revenues and thus stock prices.

I agree with Paul, that watching the trends in keyword prices could be a valuable predictor of future stock prices, I would also suggest that as an affiliate marketer that markets across multiple categories, that we may be in a position to understand customer buying behavior and sales conversion trends better than most.

For example, British Airways has had a run up on their stock of 15% since December, but this month their conversion rates tanked on the traffic I had been sending them and I lost quite a bit of money. Could that be a predictor that British Airways is going to have a stock slide?

Prices in keywords could be a good predictor, but tracking the trends in site conversion rates could be even better.

Microsoft has recently launched their new search engine and already pundits are questioning the amount of advertising for each search.

The bulk of the latest release revolves around Microsoft using it's own spider to identify relevant organic search results, brining MSN Search one step closer to owning 100% of their product.

On the paid search side, they are still running the bulk of their pay-per-click ads through Overture. Recently they extended their deal with overture until June of 2006.

Besides using Overture's paid search, MSN also offers up to 3 available spots on any search for featured sites willing to pay a minimum of $75,000 per year.

When you look at these moves and Microsoft's recent aggressive use of head hunters to build up their own internal search department, it clearly spells that Microsoft is targeting their full force behind search.

I think we will quickly see search being an embedded feature of the next operating system and quickly Microsoft will replay the browser wars on the search space.

Authoritative rumors have it that Google turned down a Microsoft buy-out proposal prior to the Google IPO. It will be interesting to watch how the search war plays out and if Google can do better than Netscape did in the Browser war.

Google has been on the move recently, a 7 Fold rise in net profit surprised Wall Street sending the stock up 14 points today.

A little more quietly, Google has become an ICANN registered registrar which will allow them to start selling domain names. There is a lot of speculation about what they will do with this status. The most obvious fit would be to offer cheap domain names as an up sell to their blogger and gmail services. Some have speculated that this could be a move towards the hosting market.

Finally, Google has announced a new beta API interface to their Adwords product that will enable creative programmers to provide add on services and let savvy marketers gain better control over their Adwords advertising. It will be fun to watch as new 3rd party services hit the market.

According to an Internet Retailer article, as recent Nielsen/NetRatings report indicate that broadband users make significantly more online purchases than their narrowband counterparts, and spend more money online.

This bodes well for Internet marketers as more and more people buy cable modems and make the switch to broadband.

According to Hitwise:
Of the top 500 unique search terms used in visits to shopping and classified sites, 86.7% were related to corporate brands, 10.8% were related to generic product names, and 2.5% were related to product brands. The fastest growing shopping categories were grocery & alcohol, books, computers, sports & fitness, and flowers & gifts, Hitwise says.

According to comScore:
Of the 25% of consumers who purchased a consumer electronics or computer product after searching online in the first quarter, 92% made their purchase offline. Of the 8% that bought online, the “vast majority” made their purchase in subsequent online sessions.

ComScore also found that generic product terms accounted for 70% of search volume for consumer electronics and computer products and for 60% of search-to-purchase conversions. In contrast, it found that branded terms accounted for 30% of search volume but 40% of search-to-purchase conversions.

Happy Halloween everyone! I hope everyone has had a profitable Halloween selling season. At Imwave, we did well selling Halloween Costumes and other merchandise this year using a quick and dirty Halloween Costume Sale site and PPC ads on Google, Overture, Kanoodle and Findwhat. Got to love Halloween.

I thought it would be interesting to see some of the many Halloween logos of our search partners. Here are a few:

MSN has put it's Search Engine Preview back online. Make sure your site's are well ranked.

Here are some links:

Bill Gross is an innovator in the search engine space and the brains behind Go-To.com which became Overture and was sold to Yahoo. He founded the whole pay-per-click search engine advertising model. When he creates something new in the space, it is worth looking at.

On Tuesday October 5th, Bill Gross announced the beta launch of Snap.com, a new search engine and advertising model. Snap.com focuses on 3 major changes for the user experience:

1. User Control – The searcher gets to change the order of search results, refine search results instantly, and hone in on exactly what you’re looking for.

2. User Feedback – Snap.com takes into account what happens after people click on search listings at snap.com and others, to use as feedback on the relevance, and get you better results up at the top. Their goal is to help users avoid dead end searches, and saves time. Their goal is to figure out, based on millions of users, what people are really looking for so they can put custom formats on search pages where previous users signaled their “intent” by their follow-on searches.

3. Transparency – They plan to reveal every action and transaction at the site, so you know what we are doing and what other users are doing. They will even reveal their revenues. They think that users get better results because transparency prevents advertisers or others from gaming the system.

On the advertisers side, there are some changes too. The advertiser signup form indicates that you can buy advertising based on any one of the following models:

Executive Search Firm Heidrick & Struggles International Inc. said it earned nearly $130 million by selling Google Inc. stock it got as payment for finding the Internet company a new CEO in 2001.

Nice Deal!

See the full Mercury News Article

USA Today reported today that according to a recent IAB / PWC Report, Search Engine Marketing is up 97% in Q2 2004 over the same period last year. Search represented 40% of the 2nd Quarter's overall $2.3 Billion in Internet Advertising.

I’m not a big fan of Findwhat.com’s new Pay-per-call (PPC) search service allowing small businesses without an online presence to engage in pay-per-click (commonly known as PPC) advertising even if they don’t have a web presence.

I believe the entire business model of this offering is flawed not to mention the acronym duplication.

First, many providers of online presence including Network Solutions have developed easy-to-use web-based tools to help small businesses affordably, quickly and effortlessly get online. In fact, a hosted site starts at only $1.50 a month per-page which is a lot cheaper than Findwhat.com’s $2.00 minimum cost per click charges (note: this fee doesn’t factor in additional calling costs which are being waived during the introductory period) for Pay-per-call.

Second, I don’t believe the premise “And, expect great conversion rates” is going to hold up against bidding limitation when pay-per-call advertisers can only select category and not keyword specific searches even if geographic selects are incorporated. Category performance is too generalized and I wouldn’t be able to recommend to a small business that paying for untargeted ad inventory is worth $2.00 or more a click. Further, the notion that “Calls often come later in the buying cycle, closer to purchase” may be true, however, what FindWhat.com seems to be claiming is searchers are only going be calling when they are ready to purchase which seems unlikely since I believe many of the pay-per-call advertisers are not likely to be part of a considered set of providers since individuals who value the time saving benefit of shopping online are unlikely to take the time to learn more about a business without a website.

Finally, banner-like ad units are hardly compelling enough to make the service revolutionary rather ho-hum.

Here’s a link to the FindWhat.com press announcement, and an article published yesterday by ClickZ touting the new offering.

Yahoo! announced yesterday on their blog that they have begun beta testing a travel search engine that searches over 50 travel sites for air, hotel, and rental car rates. Their new program is based on the technology of FareChase that they acquired earlier this summer.

It will be interesting to watch and see if and how they integrate additional pay-per-click advertising opportunities into the search. I suspect they will leverage their new Local Search / Advertising platform.

WebmasterWorld will hold it's 7th Search Conference in Las Vegas on November 16th-18th, 2004. There will be three tracks (Seach, Affiliates & Advertising, and Webmaster General). For more information about the event, visit:

http://www.webmasterworld.com/conference/.

Search Engine Roundtable has posted some more upcoming events.

I recently stubmled across Search Engine Radio with Brad Fallon. It looks like they air lve on Tuesdays from 9am - 10am PST (11am for those of us on the East Coast). They also have their initial 3 shows available for listening.

Enjoy

About a month ago, I attended the Internet Advertising Bureau's Search 2004 Road Show in New York. Their major topic was the branding effect of being high up in the organic and PPC rankings on the search engines. The research was very interesting and definitely showed that being in the top position on either the paid or the free side of listings had good overall effects for brand recognition for the company.

If you are interested in seeing some of their presentations, here is a url to download them:
IAB Road Show Presentations: Search 2004: The New Branding Story

Enjoy!

Recently Steve Harmon made some conjectures on Google buying Monster.com or DoubleClick:

---
Now that Google (NASDAQ:GOOG) is finally public and cashed up, Steve Harmon thinks some consolidation could be on the way. Why is Google a buyer now? Google is too exposed to pure advertising as its revenue and earnings driver and Harmon thinks it needs to diversify its revenue streams, similar to how Yahoo (NASDAQ: YHOO) did several years ago.

In short, he thinks Google needs to acquire some service-based companies, especially in hot sectors. And topping that list is Monster.com (NASDAQ:MNST). Barrons agrees with Harmon. At about $2 billion market cap and 40x P/E the company seems relatively cheap vs. Google's rich valuation.

Google has to mitigate its advertising risk. At the same time, Google just launched banner-type ads, where before it served only text ads. Which makes Harmon think that banner ad leader Doubleclick (NASDAQ:DCLK) could also be a good match for Google to acquire to consolidate its position.
---

I still think AOL is a safer bet, they can diversify their revenue stream while shoring up their largest partner that is known to be "on the block". I think they need to act fast before Yahoo! does.

I also think DoubleClick might not be a bad move for them, it just doesn't have the strategic benefits of an AOL or the massive customer base. There are a slot of brands under the AOL umbrella that Google could spread advertising to and enhance with their search technologies.

Any other great targets out there?

How about Disney? Love to see the Googleworld. If the Google Dance was any indication, they might just do a great job in the theme park business.

I saw this quote in a press release this morning and found it very interesting:

"According to Amit Singhal, principal scientist at Google, over 50 percent of the 200 million searches performed a day have never been searched before."

One of the primary tools for keyword research, Wordtracker, looks at past searches. Even the free keyword tools look at previous searches.

So this leads to two thoughts:

1. You need to research keywords on an onging basis, because people are always find new ways to search for your products.

2. You need to take the existing research and apply variations. Word combinations, word order, misspellings, typos, etc...

Any other ideas? 50% is a bid number!

Another Corante contributor, Ross Mayfield of Many2Many, recently wrote an interesting article entitled "Cost per Influence" where he postulates about a model in which companies would pay publishers based on their ability to influence a sale. Recently John Battelle did a great job summarizing and expanding on the idea that Ross put forward in his article "Sell Side Advertising"

John speaks of a model where companies would place their ads out on an open market and publishers / bloggers, would come by and pick up these ads and run them as they wish. The tracking tools would be part of the ads, so that advertisers would know where their ads were running and how they were performing.

To be honest I am not sure this gives the advertisers any more control over the distribution of their ads, plus it ads a level of payment complexity that would be very hard to overcome.

I do agree however that the Adsense model where advertisers have little control over where their ads appear is problematic. I think sell side advertising would make this problem even worse.

What we need is PremiumSpots.com (a fictitious company, domain is for sale if you like my idea ). PremiumSpots.com would contract with premium service providers and enable the better publishers to let people bid specifically on specific spots on their site. So if I was running and add for Web Hosting Services, I might pay $50 per click on the registration page of a domain name service provider after a customer has just purchased a .com address. If this company was just running Adsense, they would get lumped in with all the rest of the companies and may not even show up as relevant for Web Hosting at all in the current model.

This PremiumSpots idea would maximize revenues for publishers and enable advertisers to find the best and most influential spaces to place their ads as opposed to the current run of network style of contextual advertising.

Once you had a large number of companies offering PremiumSpot advertising, these spots could be bought by categories or site by site by the advertisers.

What do you think?

Please note, all ideas postulated by the editors of goyami and the corante staff are for sale at a reasonable price. All rights reserved. :-)

There have been a number of signs lately that Google is struggling with their Adsense Contextual Advertising program. Recently Todd and I have received postal mail promoting contextual advertising as well as credit offers via email of up to $1500 for re-enabling contextual ads in our campaigns and our client’s campaigns. ClickZ reports another sign of trouble in their article about Google removing Adsense ads from their Blogger application in exchange for a navbar that includes search instead.

Google went public on the NASDAQ today. The initial price was set at $85 but opening trades around noon actually started trading for $100 per share. Some reports had the stock trading as high as $135.91, but actual highs for the day were $104.06 before closing at $100.34. While not a Netscape IPO, Google's debut was nothing to sneeze at.

What do you think will happen next?

There is some speculation that Google will buy AOL, one of their largest partners and owners of many popular Internet brands like AOL, ICQ and Mapquest. This could be a good use for their IPO money, but they might have to act quickly. It is widely known that Time Warner is shopping AOL around, and rumors have it that Yahoo may be interested. A Yahoo purchase of AOL could deal a large blow to Google by taking over one of Google's largest distribution partners.

Google is set to start trading today, Thursday August 19th. The price was set at $85 per share on the lowest side of the speculated price range.

CNN has some good coverage worth reading.

Will Google completely automate keyword and ad text reviews for AdWords?? Perhaps. I recently noticed new AdWords ad text review features being tested in one AdWords account I manage. On the surface, the changes mirror modifications Google has included before which allow advertisers to select either http or https destination URLs. However, Google has added another layer of rules-based reviews to ad text submissions. If an ad text editorial policy is not followed – like excessive capitalization – an error message is delivered highlighting the potential policy violation. You’re also given a link to request an exception. The new feature is likely to streamline account activation times and minimize human reviews. Here's a screenshot:

As we anxiously await Google’s IPO which, according to Google could happen as soon as this week. It is worth taking a quick look back over some of the blunders made along the way.

Google has shown an irreverent attitude throughout the process. They have pushed forward with a dutch auction style offering in hopes to put more money in their pocket, or as their PR team puts it, more shares in the hands of individual investors... Now they have slashed the price range from $108-$135 per share to between $85-$95. I guess the demand they had predicted just wasn't there.

To add insult to injury, after the announced that they failed to register 23.2 million shares with the SEC that they sold to current and former employees and consultants, the company offered to buy these shares for $25.9 million. At this price, Google is saying to the world that they think their shares are only really worth $1.12 per share.

Throw in an interview with Playboy magazine by the founders during the company's SEC mandated quiet period, and you have a case of a young, irreverant compnay in desparate need of adult supervision.

As Google moves into the big leagues, it will be interesting if they will sink or swim.

Do you think Google will prosper like Yahoo and eBay or flounder like Netscape?

Earlier this summer, I boarded a Carnival Cruise ship in route to Halifax, Nova Scotia, Canada, and attended a well-organized affiliate marketing conference called Affiliate Summit.

During the Conference, I sat in on Rachel Honoway’s presentation on integrated performance marketing. Rachel is VP Sales & Marketing at Kowbunga, a provider of affiliate marketing solutions, and software tools supporting paid search marketing. During Rachel’s presentation, she unveiled the beta launch of a new combined Pay Per Click (PPC) Management and ROI tracking tool specifically designed for Overture and Google with planned support for additional engines. The tool is a PC-based solution. I’m in the process of beta testing the offering for two major publishers personal finance news and information. The suite I’m testing is actually two integrated tools – PPC Track (bid management) and MyAffiliateProgram (ROI tracking). I’ll provide more insight on my beta test experience shortly.

Todd