Wednesday, July 04, 2007

Cluing in to Search Marketing

I’ve found that many business owners (like many other marketers) are still confused about search engine marketing: what it can do and why it works. In his company’s blog last week, Gord Hotchkiss, CEO of Enquiro Search Solutions in Kelowna, BC, offers one of the best illustrations I’ve ever seen of the power of search marketing.

Warning: some of Gord's analysis is heavy going for non-professional marketers. But if you stick with it, you'll have had a free, cutting-edge course in Internet marketing with a huge potential payback.)

A few weeks ago, Gord accused Ontario Tourism of not having a search strategy. Responding, the provincial agency claimed to have "an extensive search program". If that's true, Gord maintains, you can't tell from the results. Ontario Tourism’s site didn't show up when Gord Googled such key terms as Ontario vacations, Ontario resorts, Toronto vacations and Ontario holidays.

“This proves too good an example of the disconnect I see all the time," writes Gord: "managing a search campaign to budgets, not objectives. I stand by my original claim: Canadian advertisers aren't clueing into the power of search.”

Ontario Tourism’s spokesman claims to be buying thousands of "targeted keyphrases" and using heavy geo-targeting to focus on prime markets. That makes sense, says Gord, if your budget is limited. "“But in this case, are budgets really limited?"

"Let me share some things I was able to dig up on the site. First of all, Ontario Tourism is doing print (lots of print) and TV (lots of TV). The goal? To drive people to their website. Full-page 4-color ads are running multiple times in over 70 dailies and weekly newspapers and 9 magazines. One 4-color full-page ad in the Toronto Star would run about $54,000. Circulation of the Toronto Star is 350,000 (on an average day). An excellent conversion rate for a newspaper ad would be 0.5% That means, ideally, 1,750 people would actually visit the Ontario Tourism website. That would be a cost per visitor of $30.85. If the ad doesn't work that well, the average cost climbs dramatically. And you pay whether or not the ad works.

“Now, courtesy Yahoo Canada and a recent survey, let's look at what actual travelers cite as the most important influencers in making travel plans. Search and websites are tied for number one and two, used by 51% of respondents in a recent survey. Newspapers and print? Only used by 7%. But yet, only 2.1% of Canadian ad budgets get spent on search, and 42% gets spent on Newspapers and Magazines."

“So, where is Ontario Tourism in the search results? They're only geo-targeting the prime markets, and then only for a 3-month period (April through June). Only 1 of
the 7 highest traffic key phrases I found (using an Ontario IP) returned an ad or an organic listing for Ontario Travel (the site also hasn't been organically optimized). More specific phrases, like Ontario Summer Vacations or Ontario Wine Getaways, did return more ads. But by bidding on specific phrases (even thousand of "long tail" ones) and not on the more popular ones, Ontario Tourism is catching less than 10% of all the people using search to plan a vacation in Ontario. And unless you're in the top sponsored ad locations (which few of the ads I saw were) you're actually only being seen by a small percentage of those searchers (usually 10 to 30% of them) on the results pages you do appear on. So, according to 97 out of 100 people who are using search to find the official site for Ontario Tourism, they're not "doing search".

"By the way, you could maintain top spot in Google and Yahoo for all the top traffic phrases for less than $2 per visitor. Remember, that ad in the Toronto Star cost, at a minimum, 15 times that!

“Is it really "smarter" to ignore 97% of the people who are actively searching online to find you so you can spend more money running ads in newspapers for the 99.5% of people who have no interest in your site at all? And the real irony here is that if people don't click on a search ad, you don't pay!

"Take a fraction of that budget from the Toronto Star and blow out the geo-targeting and time parameters and go for the high-traffic phrases. After all, there might be people in Saskatchewan or Nova Scotia that are planning a trip to Ontario. Or, perhaps they're planning their trip in September, or February. If not, it's not costing you anything. Try getting the Toronto Star to offer the same pricing model!

Note from Rick: At heart I’m a print guy, so I know the value of media advertising. But if your market is actively using the Net to make its buying decisions, you must be exploring these pay-per-click models (e.g., Google AdWords). They may or may not work better than what you're doing now, but they're certainly promising. And experimenting with them costs you almost nothing. Go ahead, get started.

Or click here to read Gord Hotchkiss’s full post.

3 comments:

brad said...

Rick,
Thanks for bringing this article to my desktop. As a recent Ontario transplant who wanted to take my family around the province I too was frustrated by the Tourism's lack of presence in search terms and even with their website (which would be a whole other article I'm sure).
Even if they did not change ONE Dollar of their off-line buys, they could still be 1st page of the major engines by correctly writing and linking their webpages, and it's a shame that they don't take Mr. Hotchkiss' words as a free business lesson rather than getting their backs' up about it.
As for us, we went to Ottawa for long weekend and had a good time. But everytime I see one of those beautifully shot (and they are nicely done) commercials for Ontario, I wince a little that we won't be getting there this year.

Cheers!
Brad

Gord Hotchkiss said...

Rick

Thanks for the pick up of the post. As far as free lessons, I can point you to a follow up post on my blog:
http://www.outofmygord.com/archive/2007/06/29/So-You-Really-Want-to-Integrate-Search.aspx
And I started as a traditional marketer so I know that print and TV and (heaven forbid) radio have their place. I'm not saying don't use them, I'm just saying make sure you collect all the low hanging fruit first!

Stephen Welton said...

Very true. Educating local area vendors on the power of search engine marketing will keep me busy over the next year. Thanks for posting a very important topic.