Does an Organic Search Presence Help Paid Result Performance?

A study from a couple of NYU Stern professors has found that organic search engine results can play a direct role in whether or not a paid listing is clicked. Basically, if this research is any indication, if your business has both a paid result and an organic result appear at the same time, you have a better chance of your paid result getting clicked than if the organic result had not appeared.

Professors Anindya Ghose and Sha Yang have highlighted the following findings:

- On average, the impact of organic listings on paid advertising is 3.5 times stronger than vice-versa, possibly because of the tendency of consumers to trust organic listings more than paid ads.

- The positive association between paid and organic listings increases advertisers’ profits by at least 6.15% when compared to profits in the absence of either of them. The positive association is strongest when advertiser-specific keywords are used and weakest when brand-specific and generic keywords are used.

- Click-through rates, conversion rates and total revenues are higher when both paid and organic listings are present simultaneously than when paid search ads are absent.

- The combined click-through rates are 5.1% higher when paid and organic listings are present simultaneously than when only the organic listings are present.

- The combined conversion rate increases 11.7% when paid and organic listings are present simultaneously than when organic listings alone are present.

- Paid search advertising drives up to 54% of total revenue growth.

The professors used "a unique panel dataset of consumer responses to keyword ads on Google" to conduct their research. The complete findings from the study are evidently available in a paper entitled "Analyzing the Relationship between Organic and Sponsored Search Advertising: Positive, Negative or Zero Interdependence?" It's 52 pages long.

"These findings have important implications for the incentives of search engines to strategically modify the rankings of their organic search listings in order to boost their revenues from paid search advertisements," says Professor Ghose.

Ghose's point is an interesting one. Nobody's making any accusations here, but would search engines tweak organic results specifically with the goal of increasing the performance of paid results, and bringing in more revenue? What are your thoughts on the subject? Comment here.

Have You Read This?

> Google and Heineken Study Search for Branding

> Report: Paid Search Spend Up 10%

> Search Ads Convert Better with Display

Google Gives AdWords Users New Alert Options

Google has introduced a couple of new alert options for AdWords advertisers. Users can of course use account alerts, and can also use custom alerts. Now Google has added new alerts for keyword and budget ideas, which are personalized tips to help users improve their campaigns' effectiveness. These are in the "opportunities" tab.

"New ideas are usually generated for campaigns and ad groups every few weeks, but you may miss ideas that can expand your coverage and boost your traffic if you don't check the Opportunities tab regularly," explains Google's Dan Friedman. "Now, when there are new ideas available for your review, you'll see them highlighted along with the rest of your campaign alerts."

Google has also added the ability to create custom alerts for changes in conversion volume, conversion rate, and cost per conversion for users using AdWords conversion tracking.

"By setting alerts for your conversion data, you can make sure that you're quickly notified about fluctuations in your key metrics," says Friedman.

Google says it is still working on bringing custom alerts to all linked accounts for My Client Center (MCC) users, but until then, you can just set custom alerts for individual accounts if you can log into them directly.

Have You Read This?

> Google Gives AdWords Advertisers New Comparison Option

> Google Launches Latest Version of AdWords API

> More "Ads by Google" Across the Web

Note Your Google Website Optimizer Experiments

Google has released a new feature for its Website Optimizer tool, called Experiment Notes. The feature is designed to help users include documentation as part of their testing. For any experiments, users can now add their own annotations.

If you are unfamiliar with Website Optimizer, it's a free tool from Google that webmasters can use to increase conversions by making adjustments to design and text elements to see what works.

"What you put in your note depends on what stage your experiment is in," explains Trevor Claiborne of Google's Website Optimizer team. "If you're still designing your experiment you might include your testing hypothesis or some variations you're considering. As your experiment is running, you might include any external factors that might have an impact on your conversion rate. And as your experiment concludes you might include some thoughts on why variations performed as they did."

"Experiment notes are also great if you have several teams coordinating on a Website Optimizer experiment," says Claiborne. "For example, your IT team might update the note once they've installed the Website Optimizer tags on the test page. Your creative team can then start creating variations in Website Optimizer and update the note."

The Experiment Notes feature can be found on the settings page for any experiment in Google Website Optimizer. For some tips on using the website optimizer tool, check out this article.

Blogs Can Still Drive Big Traffic

You would almost think blogging was dead, the way headlines are dominated by Twitter, Facebook, and social media in general. I've always considered blogging to be a part of social media anyway, as the commenting factor lends to engagement between author and user.

But blogging is so five years ago right? It's all about microblogging and status updates now isn't it? If you think that's the case, think again, because blogs can still drive big-time traffic to websites. An example of this has been illustrated by the launch of e-commerce site Alice.com.

How much traffic are you getting from blogs? Talk to ArisYulianta and Friends....

If you are not familiar with Alice.com, it is a site where consumers can buy everyday household items like toothpaste, toilet paper, laundry detergent, diapers, etc., right from the manufacturers, rather than through middleman retailers. It launched in June, and by July it had doubled its traffic to 387,000 unique visitors, according to Compete.

Guess where the majority of that traffic came from. According to Compete, it came from word-of-mouth from blogs. In fact, its number one traffic source was Blogger.com. Not Twitter. Not Facebook. Not search. Although each of these no doubt played valuable roles as well., Blogger.com has been the biggest factor in driving traffic for this site, and from the looks of things, that traffic is showing no signs of slowing down.

Blogger accounted for 18% of Alice.com's referral traffic in July, and obviously there are plenty of blogs out there that aren't hosted at Blogger.com. On top of that, Compete says Alice's conversion rate jumped to 3.5%  in July as well.

Of course, you have to give bloggers something to talk about to get valuable blog traffic. It's no different than getting people to talk about you on social networks or through any other form of word-of-mouth marketing. It starts with your product. Clearly Alice.com, has something that many people find worth talking about.

"Anyone who has previously shopped online for household products knows that prices are generally higher (sometimes considerably) than those found in stores," Compete's Matt Pace says of Alice.com.  "By selling directly to consumers, manufacturers are able to price their products below those found on most online retailers and more competitively to those found in stores."

Clearly this is a void in the lives of consumers that Alice is attempting to fill. It's still early to tell if this site will remain a success. As long as it keeps the bloggers (consumers) happy, it could enjoy a long life. Because one thing to remember about word-of-mouth is that it works both ways. Reputations can quickly move in different directions online. So can traffic.

Do you see more traffic from blogs or from social networks? Comment here.

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