89% of Paid Search Traffic is Not Replaced by Organic Search

A Google Study Says: 89% of Traffic Generated by Search Ads is Not Replaced by Organic Search:

Um isn’t that obvious??

I just read a post by Avinash Kaushik over on Google+ (Yep I’m on Google+ as well: Bryan Coe), about the use of PPC versus Organic Search. He was specifically talking about a study by Google where they found Studies Show Search Ads Drive 89% Incremental Traffic. Basically what the study is saying is that if you are running PPC ads and you stop them, you will see an 89% drop in traffic. By “overall” they mean the combination of clicks due to organic search results and PPC ads.

ppc management one piece of the puzzleIn my opinion this is a trivial study? Because if you are already ranking very well for keywords organically (ie #1 or maybe #2), would you target them with PPC? My guess is no. Google and others have done studies to show how quickly the percentage of clicks drops as you go further down the list.

So, by using PPC with keywords for which you are unable to grab the top spots, you can augment your traffic. And let’s face it, for most sites the list of keywords where you rank #1 is much smaller than the list you would like to target.

Therefore, it seems to me quite obvious that your over all clicks would be greatly reduced when ads are paused.

Avinash pointed out that the study was structured to show the empirical data behind my assumption that advertisers are not targeting keywords for which they are ranking well organically.

But really the study does not address this. It only makes an assumption about the “Incremental Ad Clicks” or IAC being low when advertisers use keywords in their PPC list where they are also ranking highly organically.

“A low value for IAC may occur when the paid and organic results are both similar and in close proximity to each other on the search results page. This increases the likelihood of a user clicking on an organic result as opposed to a paid result.”

The study would be more accurate if it looked only at these keywords. Comparing PPC keywords that you pay to be in the top positions to all keywords regardless of where they rank organically skews the data towards a dramatic conclusion. I think the idea that removing your PPC ads is going to give an 89% drop in clicks is a shock factor.

To put it simply, if you are going to use the PPC you need to evaluate the cost of buying a click vs. the profit it gains. If you are pay too high a price for your clicks then it is not a profitable model. Plus, if you are ranking well for certain keywords, you probably don’t want to target them with PPC.

Now, what goes into that evaluation? You can use this study to evaluate keywords that you are ranking highly for organically compared to the same keywords that you are paying to get a high ranking via PPC. For keywords that are not doing as well organically or maybe that are not on the radar at all on the organic side, then you need to look more directly at the cost per click as apposed to the value of the click.

The main point is that using PPC Advertising can do a great job to augment your organic search, but you have to evaluate if it is the best value for your company.

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