Ad Club panel offers perspectives on search

Search experts discussed search engine recommendations and the value of pay-per-click ads at a panel discussion today on “Smart Choices in Search Advertising.”

The panel, hosted by The Advertising Club at the Yale Club in New York, included David Berkowitz, director of emerging media and client strategy of 360i; Adam Epstein, president and COO of adMarketplace; Jonathan Ewert, general manager of LookSmart; and Kevin Lee, executive chairman and co-founder of Didit.  MediaPost’s Wendy Davis was the moderator.

One of the first topics discussed was which search engines to recommend clients use in a campaign. Lee said he doesn’t advise until he fully knows the particular client’s objectives, adding it also depended on the campaign’s budget. A bigger client is more likely to use both the “big three” search engines as well as second-tier ones, he said.

Epstein pointed out that only 5% of Internet usage happens in search. Content makes up the other 95% so it’s important to see that differentiation and keep that in mind with search campaigns, he noted. Lee agreed, saying Google’s AdSense covers both search and content sites.

“People reading a blog are in a different mindset than someone who is searching,” Lee said. So, companies may need to have different ad copy or creative for different online scenarios.

Also covered was whether pay-per-click (PPC) ads that don’t get clicked on still hold any value for the advertiser.

“Direct marketers are interested in getting return on their ad spend dollar,” Epstein said, “They want lower cost traffic that converts.”

But other panelists said that impressions aren’t without value. Ewert noted the possibility of Google using text ads with the company’s logo next to it.

“There’s value there,” he said.

Lee also said that it’s unfair to publishers to say there’s no value in impressions.

“People see the advertisement, even if there’s no click,” he said.

However, Berkowitz noted, because Google is performance based, if an ad doesn’t garner enough clicks, the advertiser could be penalized. The ad’s cost per click could increase, or the ad could even be removed.

At the end of the day, Lee said, companies are not just buying clicks—they’re buying sales.

“Companies need to allocate their budget and pick outlets that have a high yield to reach the right people with the right message to either influence them, or drive them to an immediate purchase,” Lee said.

Discussion ultimately turned to the Google-Yahoo ad agreement.

“There are still a lot of unanswered questions,” Lee said.

Lee argued the agreement might not be in the best interest of large advertisers that use both Google and Yahoo—that they may come into a situation where they’re bidding against themselves. It could, however, be beneficial for smaller advertisers that only use Google, but that the deal reduces choice and limit’s Yahoo’s ability to innovate, he said.

Epstein agreed, saying it would create a monopolistic situation and that the now defunct Yahoo-Microsoft deal would have been better for competition. However, the future is still unclear.

 “2009 is the first year where we really don’t know what the search engines will be [going forward],” he said.

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