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Paid Search Boosts Sales

Oct 1, 2009

Paid search, often called sponsored search, in which website owners pay an advertising fee on search engines, is more likely than organic search to bring in buyers, according to a recent study. In organic search, web pages appear based on their relevance to the searched item. Visitors who arrive at a retailer's site from paid search ads are 50 percent more likely to buy than those who come from clicking on a natural search link, according to a new study by search marketing firm, Engine Ready.

The conversion rate from paid search is 2.03 percent, versus 1.26 percent from organic search, according to the study, which is based on traffic to 26 ecommerce sites. "This could be a reflection of a more tailored landing page for the paid traffic visitors, or a greater intent to purchase, when a web user clicks on a paid ad versus an organic listing," according to the report, titled, "SEO vs. PPC: The Final Round," which compares search engine optimization and pay per click.

Most likely to buy are consumers who navigate directly to a retailer's site by typing in a URL or clicking on a bookmark, as their conversion rate registered at 7.38 percent. And consumers who came to an ecommerce site from another site, or an email, converted at 6.58 percent, the study revealed. The overall conversion rate was 3.6 percent.

The study also found the following:

  • Paid search visitors bought the most, with an average order value of $117.06, versus $109.27 for those coming from other sites, $106.64 for visitors from organic search, and $95.29 from direct referrals, such as from a bookmark or direct entry of a URL.
  • Average order value for all retailers in the study was $104.21, down 31.7 percent from a previous Engine Ready study that analyzed data from a two year period that ended December 2007. The economic downturn likely is the cause, as retailers indicated that average order values from all channels have declined in the past 12 to 18 months, said Brian Lewis, Engine Ready VP.
  • The average time on a site per visit increased 5.8 percent from the previous study to four minutes, 33 seconds. Consumers who navigated directly to a site spent the most time, five minutes, eight seconds. The study found consumers who spent more time on a site were more likely to buy, but that their average order value was not higher than that of other buyers.
  • Site visitors on average viewed 5.2 pages per visit, up 15.6 percent from the previous study. Those who came directly or from other sites, or email, viewed the most pages, 6.2 on average.
  • Average number of seconds on a page dropped nine percent from the earlier study, to 53 seconds, which could be a sign that, "marketers are doing a better job of presenting information on their pages in a more easily readable format," according to the study's authors. Paid search visitors spent the most time on a page, 66 seconds on average.
  • 43.9 percent of all visitors left after viewing just one page, down slightly from 44.5 percent in the earlier study. Organic search produced the highest bounce rate, 48.5 percent, and direct access the lowest, 39.2 percent.
  • Direct access produced the largest share of site visits, 40 percent; followed by other referring sites and email, 27.9 percent; paid search, 19.8 percent, and organic search, 12.3 percent.
  • Returning visitors accounted for 25 percent of all visitors. However, the true figure might be closer to 40 percent, when taking into account consumers who regularly delete tracking cookies from their browsers. Lewis noted a comScore Inc. study from 2007, which found that 31 percent of U.S. computer users clear their cookies on a monthly basis.

The report is based on an analysis of 20.8 million visits and 108 million page views to 26 ecommerce sites.

Topic: Business Strategies

Related Articles: marketing 

Article ID: 1202

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