Search Engine Guide: Only Technology Can Overcome Search's Complexity
To give you an idea of the challenge, say you were selling Britney Spears merchandise. How many ways can you think of (mis)spelling Britney Spears? 10? 20? 50? Google found searchers used more than 350 different spellings of her name to find pages on the singer. This difference means money. On Yahoo Search Marketing, "Britney Spears DVD" costs 30 cents, while "Briteny Speers DVD" costs 10 cents. Both searchers are looking for the same thing, but one will cost you 67 percent less.
Another example involves conversion rates. The cost of the keyword "hotels" is $1.48, while "hotels in New Hampshire" is 87 cents and "five star hotels in New Hampshire" is 40 cents. Longer keywords are cheaper and tend to have higher conversion rates because they are more specific. To decrease costs and increase conversions, a travel company needs to cover hotel accommodations in every country, city and town, plus countless potential misspellings. Try doing that manually.
The complexity doesn't end there. We ran a campaign for a travel client that bought more than 1 million keywords. Imagine the permutations:
· More than 1 million keywords.
· Relating to hundreds of titles and descriptions (or "creatives").
· Pointing to hundreds of thousands of travel destinations.
· Each destination with a different net margin or cost per acquisition.
Now think about what price you should bid for each keyword.
This kind of scale and complexity means that the only way to manage SEM effectively is by using technology. In calculating a keyword's bid price, search firms can use bid management technology to take into account the term, the title and description, the product Web address and other factors to generate a bid price based on a client's objectives (i.e., maximizing ROI or traffic). That technology can test the performance of every keyword and delete those whose return on investment doesn't meet a certain threshold.
For more articles from The Direct Marketer's Essential Guide to Search Engine Marketing, visit www.dmnews.com/search .
A PDF of the guide is available at: http://www.dmnews.com/pdffiles/semguide.pdf