Consumers are creatures of habit, and never more so than when searching the web. For a start, they almost always use Google. What is more, they will use search engines to get to websites they already know they want to go to. Rather than type a URL of a website that they know into the browser's address bar, they'll just use a search engine to find it. And this could have important implications for paid-search advertisers.
Some 43% of consumers, according to Nielsen, use this tactic to get to their chosen website. Moreover, there has been a 20% increase in these 'navigational searches' over the past two years, according to online research firm Hitwise. In the four weeks to 22 September, it reports, five of the top 10 search terms in the travel category were for brand names, while three more, AA route planner, Google Earth, and AA route finder, were brand-based. Only two, train times and cheap flights, did not include a reference to a specific brand.
'Consumers are becoming increasingly lazy,' says John Squire, senior vice-president, product strategy and general manager of marketing services at digital marketing optimisation specialist Coremetrics. 'Also, with the advent of instant messaging and the destruction of people's ability to spell, they use a search engine that corrects their spelling, suggests what they were looking for and gives them hints to get them to the website.'
The reason this matters to advertisers, says i-level co-founder Andrew Walmsley, is the effect it has on cost per acquisition via the paid-search channel. According to him, if 43% of people typing a brand name as a search term into Google are navigators rather than searchers, and therefore less valuable in paid-search terms than a true searcher, then the real cost per acquisition will be much higher than previously thought.
Not everyone agrees with Walmsley. Jim Brigden, chief executive of The Search Works, agrees that consumers type brand names into search engines to get to websites, but argues that this is usually the final step in a multi-stage process. 'We monitor every click and keyword on every search engine for our clients, which enables us to understand the value of each click,' he says. 'Huge numbers of customers type in the brand term and end up making a purchase, but those same consumers will have conducted three, five or maybe 10 searches on more generic tags before they get to the brand.'
Jonty Kelt, vice-president search, international, at search engine marketing services agency DoubleClick Performics, agrees, comparing search to the 'purchase funnel' model, where consumers become aware of a need for a product or service, investigate the available options and then make a decision. For this reason, says Kelt, it is vital for brands to buy search terms for each part of the process. For example, 'insurance' at stage one, 'car insurance' at stage two and 'third-party car insurance' at stage three, with the brand name taken as a given at all stages. 'The final search term is the one that gets all the credit for the purchase, but there are several steps toward it that search advertisers need to understand,' explains Kelt. 'They are getting only a limited view of the world if they do not appreciate how someone got to that term.'
If consumers use search engines to get to their favourite sites, those sites need to be prominent in the listings. For a brand to bid on its own name might seem so obvious as to be above discussion, but according to Brigden, it is something many companies fail to do. 'There are still many blue-chip and big e-commerce companies that are hard to find online because they are not spending the necessary money on search,' he says.
This is despite the fact that, according to Hitwise, 15% of all brand searches drive the searcher to a competing brand, usually when the brand being searched for does not appear on the first page of the natural or sponsored results.
Ignorance may be partly to blame, especially when brand names can be trademarked on Google and other search engines, and bought for a nominal sum - some for as little as 1p per click. The problem is exacerbated when a brand's affiliate network steps into the void created by the brand owner's failure to capitalise on the paid-search opportunity, according to Andrew Burgess, managing director of digital and direct response media agency Equi=Media. 'If an affiliate network is allowed to bid on the brand, then a huge volume of clicks will be distributed to other websites first,' says Burgess. 'Policing the networks is a key issue.'
In one recent instance, Burgess' firm picked up an account where the incumbent agency had not protected the brand name. As a result, there were eight separate companies bidding on it, driving the cost far higher than it needed to be.
Another view is offered by James Quint, head of digital at Mike Colling & Company. He makes a distinction between brand owners selling direct to consumers via their websites, and those whose goods are sold via third-party retailers. The direct sales companies, he says, need to be active in both the natural- and paid-search listings areas, though he agrees with Burgess that they should take steps to minimise their cost-per-click by trademarking the brand term.
But those who do not sell direct, argues Quint, do not need to be active in paid-search. Brands such as Ray-Ban sunglasses or Cannondale bikes, says Quint, can manage with good search-engine optimisation alone. He says that people can make the distinction between searching for information on a firm's product line, through search-engine optimisation, which pushes the brand up the search results, and those e-tailers that are actually selling the products online, though paid search.
'Why would Cannondale want to spend money on pay-per-click traffic when it isn't even selling bikes direct?' asks Quint. 'It gets traffic though search-engine optimisation, so it can leave the pay-per-click active purchase traffic to its retailers.'
The exception to this, says Quint, would be a brand where visits to the website are an objective of its strategy, most common among 'superbrands' such as Ford or Mercedes. 'They can still take action to minimise the cost per click and protect generic brand terms in the same way as the direct sellers, but they are looking for exposure for different reasons,' he says.
The key to effective search marketing seems to be, then, that a brand must identify what works best for it when viewed against its wider aims, a view that Quint espouses. There is no right or wrong answer, or even best practice. But there are different strategies depending on what objectives a brand has for its online search marketing.'
DATA FILE - SEARCH AS NAVIGATION
TOP INDUSTRY SEARCH TERMS:
ENTERTAINMENT
Term Volume
(%)
youtube 5.22
you tube 1.47
runescape 0.74
bbc 0.66
sky news 0.63
miniclip 0.61
bbc weather 0.58
cbbc 0.49
games 0.45
cbeebies 0.44
Source: Hitwise
TOP INDUSTRY SEARCH TERMS:
AUTOMOTIVE RETAIL
Term Volume
(%)
halfords 9.91
ebay 4.61
dvla 1.98
number plates 1.29
tyres 1.21
kwik fit 1.12
ebay uk 1.12
dvla number plates 0.89
ebay motors 0.87
demon tweeks 0.75
Source: Hitwise
TOP INDUSTRY SEARCH TERMS:
TRAVEL
Term Volume
(%)
easyjet 0.67
ryanair 0.67
aa route planner 0.64
multimap 0.64
train times 0.50
google earth 0.41
expedia 0.41
thomas cook 0.41
cheap flights 0.39
aa route finder 0.37
Source: Hitwise
DATA FILE - SEARCH ENGINE CHOICE
When it comes to the choice of search engine used for paid-search campaigns, advertisers and their search partners have it relatively easy. Google dominates the market, accounting for 81.2% of all successful clickthroughs from search engines in the UK in August, according to Nielsen//NetRatings. With Yahoo! (6.8%) and AOL (5.5%), accounting for the majority of the remainder, there is little incentive for agencies to look elsewhere, according to DoubleClick's Kelt.
'If an agency is trying to use its time effectively, and it can get 95% coverage from the big three, there needs to be a very good reason to work with anyone else,' he says. 'It would make sense if you had nailed the potential of those three and were looking for incremental reach beyond that, but otherwise, it is difficult to justify.'
Using different engines to target different demographics sounds plausible in theory, but happens rarely in practice. 'The audience captured by search engines is so huge and varied that it is pointless to attempt demographic targeting by engine,' says Ross Barnes, head of search at media agency Vizeum. 'It is possible to target particular audiences through search, but the targeting is channelled through the choice of keywords, rather than the choice of engine, therefore targeting less by demographic and more through inclination. For a music promotion, for example, keywords would be themed around music lovers, regardless of their age or locality.'
Another reason why demographic targeting has not taken off in a big way in paid search is that when the demographic characteristics of successful searchers across all search engines are broken down (50% male, 50% female; 22% earning less than 拢20,000 a year, 23% earning more than 拢50,000 a year, for example, according to Nielsen//NetRatings), then compared with the demographics of a given category, such as multi-category travel or mass merchandisers, few significant differences come to light.
There are, however, a couple of exceptions to this. The first is Yell.com, which Equi=Media's Burgess says represents an important growth opportunity, because of its high household penetration and consumers' predisposition to using it to conduct local searches. Mike Colling & Company's Quint also points out that Yell.com is a good fit for viral marketing, as its visitors are more likely to be blog creators and readers of user-generated content.
The second exception is Microsoft AdCenter, which offers advertisers demographic targeting via the data it holds on consumers collected through registrations to Hotmail, its web-based email service. Microsoft uses this information to upweight advertising to appeal to consumers in the brand's target audience. For example, take 10 people searching for 'trains to Paris', all of whom are Hotmail members and six of whom are in the target audience for Eurostar. The six who were in the target audience might see Eurostar at the top of the paid-search results, while for the other four, Eurostar would not appear.
For the moment, Google's dominance of the search engine sector is all but absolute. But if Microsoft and others are serious about making inroads into Google's market share, demographic and, in due course, behavioural targeting via search, could be two of the most powerful weapons in their armoury.