Searching For Clicks
From Research Brief

A new report from 360i and SearchIgnite, describes the value of the entire path a searcher takes from the first click through purchase. Data from more than 3.9 million users and 5.1 million clicks during the first quarter of 2006 confirms the fact that the more times a consumer clicks on a marketer’s ad, the more likely that consumer is to convert. In addition, the highest conversion rate (9.30%) resulted when the user’s first click and last click on a marketer’s paid search ad were both brand terms.

Other key findings include:
- When the first click is on a non-brand term and the last click is on a brand term, the conversion rate is almost as high (8.73%). Marketers can leverage this by driving non-brand searchers to brand terms, concludes the report
- 5% of conversions from paid search campaigns occur from consumers who click more than one of the marketer’s ads. Purchasers click an average of 5% more of the marketer’s ads than consumers who don’t complete a transaction
- Consumers who click a marketer’s ads ten times are three times as likely to convert as consumers who click an ad only once. Purchasers are more deeply involved in the process
- Conversions also rise as consumers enter more unique keywords. Consumers entering multiple unique keywords accounted for 8.39% of the sample studied, but they accounted for 19.2 % of transactions

The report cites a Hitwise study that confirms that branded paid search terms convert better than non-branded terms in search engines, and that brand terms account for a high percentage of commercial searches. The study of 30 brands in the travel, retail, and business & finance verticals found that 75 of the top 100 search terms contained brand names, up 17% over February 2005. And SearchIgnite studies on branding found that brand terms generally represent a small percentage of the keywords that are managed in a search engine marketing campaign, yet they usually account for a disproportionate percentage of conversions.
Consumers, on average, clicked a marketer’s ad 1.33 times during the searching process. For the consumers who went on to make a purchase, they clicked a marketer’s ad 1.53 times on average – an increase of 15% compared to the overall population of consumers. Put another way, consumers who convert to buyers are more likely to spend added time searching and familiarizing themselves with a marketer’s brand, website, and offerings.

A number of factors that lead to increased conversions. concludes the report, are:
- The frequency at which a searcher clicks your paid search ads impacts the conversion rate. Conversion rates steadily rise as searchers click on more ads.
- The more ways a searcher interacts with your site, the higher the probability of conversion. For instance, searchers who clicked on two unique keyword ads are more than two times more likely to purchase than searchers with only one keyword exposure.
- For searchers who begin their search process on a non-brand term and then switch to a brand term, conversion rates are seven times higher than when there are only non-brand terms.

Finally, for users who start with a brand term and end with a non-brand term, says the report, the conversion rate is four times higher than for the users whose start-click and end-click is a non-brand term. And, for those searchers who click a marketer’s ads more than once, the conversion rate climbs significantly. As an extreme example, consumers who click a marketer’s ads ten times are three times as likely to convert as users who click an ad just once.

Online Advertising in Japan

eMarketer looks at online advertising in Japan, one of the world's most "connected" markets.

As in many countries with an experienced online population, and borne out by recent data from Video Research Ltd., internet usage in Japan is higher than usage of all other types of media besides television.

New IAB Research Shows 12% Of Web Users Reject Cookies

New research commissioned by the IAB and presented at its board meeting this week shows that as many as 12 percent of consumers don't accept third-party cookies--that is, the cookies set by ad servers and analytics companies that track the Web sites that consumers visit and the ads they view, among other data.

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Study: Goodbye Purchase Funnel, Hello 'Tumbler'› › › ClickZ News
By Enid Burns May 11, 2006

New research from Yahoo and OMD finds a cultural shift in how consumers use technology to make purchasing decisions. A study released today called the "Long and Winding Road: The Route to the Cash Register" identifies four paths, or product research cycles, consumers follow as they proceed to purchases.

The study breaks purchase paths into four categories: quick paths, winding paths, long paths and long and winding paths. Quick paths are characterized by little research and are used for impulse buys or routine consumer packaged goods purchases. A winding path indicates cross-channel comparison shopping, such as for retail goods. The long path often takes place in just one channel, but is lengthy because the consumer is waiting for an event such as a price drop or the availability of a new model.

The most involved path, and the one where marketers have the most room to convert in-market consumers, is called the long and winding path. Shoppers' paths usually fall into this category when they're seeking big-ticket items like automobiles and financial services. "Consumers of these products are the hungriest for information," the study said.

Google, Yahoo Grow Search Share
GOOGLE AND YAHOO ARE INCREASING their market share of search, while MSN now lags even further behind, according to new data by Nielsen//NetRatings. Overall, search users conducted 5.9 billion searches last month, up 36 percent from March of 2005, according to Nielsen//NetRatings. But the two largest search engines--Google and Yahoo-saw even higher growth. Google searches increased 41 percent, from 2.1 billion in March 2005 to 2.9 billion last month; Yahoo searches grew 47 percent, to 1.3 billion last month from 907.8 million one year ago. MSN, meanwhile, grew by just 9 percent year-over-year, 5rom 592.2 million to 643.8 million.

Your Prospects Increasingly Dislike Registration Forms

"Typical data: ThomasNet's Industrial Purchasing Barometer study, released in August, revealed "industrial buyers are growing increasingly frustrated with the lack of privacy they are experiencing online." Although 90% of industrial buyers shop online, they are increasing demanding "anonymity when they search for products online, and in many cases, that desire for anonymity is not being respected." ThomasNet noted,
77% of respondents have a "Don't call us, we'll call you" philosophy online.
56% of respondents do not want vendors to contact them until they have made the initial contact.

81% of respondents said they would not return, or would be unlikely to return, to a Web site that reveals their identities to suppliers.
21% of respondents do not want to be contacted at all. "

One In Five Say Web Ads Most Effective

MORE THAN ONE IN FIVE U.S. adults, or 22 percent, say the Internet is the most effective way to grab their attention about a product or service, according to a report released Wednesday by Burst Media.

More Than Half Say The Internet is Their Primary Source of Product Information.

The study also found that the Web far outpaces television as a primary source for information about products and services, with 57 percent of respondents saying that the Net is where they turn first to research products they might purchase.

The most striking difference in use of the Internet for product research occurs between income segments. Use of the Internet to gather product information rises dramatically as household income (HHI) increases – going from one-half (50.6%) of respondents reporting HHI less than $35,000 to fully two-thirds (69.2%) of respondents reporting HHI of $75,000 or more. (Chart 1)

Local Web Spending Predicted To Reach $5.8 Billion

LOCAL ONLINE AD SPENDING SURGED to $4.8 billion last year, a 78 percent increase from 2004's $2.7 billion, according to a new report by Borrell Associates. The report further predicts that online ad spending this year will climb 21 percent to reach $5.8 billion.
"Last year's growth spurt was reminiscent of that seen at the height of the dot-com frenzy in 1999-2000, when many local media companies had just finished building out their Web sites and began selling online advertising in earnest," stated the report, "What Local Web Sites Earn: 2006 Survey."

For the study, Borrell examined revenues at 2,266 local media properties, including 696 daily newspapers, 148 weeklies, 1,154 radio stations, 437 TV stations, and 24 independent local sites. Borrell defined "local online advertising" as "advertising placed by locally based businesses for locally focused online messages."

Organic CEO: Brand Marketers Turn To Paid Search

MARKETERS USUALLY SPEND BETWEEN 20 and 30 percent of their online advertising budgets on search, Mark Kingdon, CEO of digital shop Organic, said Monday.
"Search continues to be an important part of the digital marketing mix for our clients," Kingdon told analysts and reporters on a conference call Monday. He added that search efforts often are integrated into broader online campaigns.
In addition to purchasing keywords on Google and Yahoo, marketers also are buying pay-per-click ads on "secondary" and "niche" search engines, like Ask.com, Kanoodle and LookSmart, Kingdon said.

Overall, search marketing accounted for about 40 percent of all online ad dollars in the first half of last year, according to the Interactive Advertising Bureau. But many of the marketers purchasing keywords are thought to be small players who don't use large digital agencies such as Organic, whose client roster includes car company DaimlerChrysler, the telecom Sprint and department store Macy's.

Fathom Follows Keyword Price Drop

For 19 months, online research company Fathom Online has been tracking keyword prices in several vertical industries to determine overall keyword price trends. The resulting Q1 2006 Keyword Price Index (KPI) results reveal that the average keyword bid price has dropped about 3% from $1.43 to $1.39 per keyword since Q4 2005.

This year, Fathom has increased the number of keyword values they track from 4,000 to more than 20,000 in categories like automotive, computers, electronics, finance, telecom, and travel. They believe that the KPI is a good monitor for the overall health of the search marketing industry. Fathom says the Q1 price drop was expected, since keyword prices are seasonal.

Despite the drop, Fathom reports that the average keyword price has actually increased overall by 1.4% since 2004. Even though it fluctuates, the average keyword bid price has settled into a predictable cycle. “Search marketing is growing at a robust 25 percent this year, and price stability helps that growth,” said Matt McMahon, Fathom’s VP of Marketing in a statement. “As advertisers see a more predictable keyword bidding environment, confidence in the channel grows and advertisers continue to invest further in search marketing