SEM - Search Engine Marketing. SEM can be viewed as an extension to or as an alternative to SEO (Search Engine Optimization). In brief, SEO means you put only ’sweat equity’ into your efforts to perform better on search engines like google. SEM means that you pay for clicks. SEM and SEO are part of your strategy for a ‘Return On Technology Investment’ or ROTI in the online world.
Mark has written an excellent post on the fact that ‘ads are out, content is in,’ identifying that increasingly people are ‘learning’ to ignore advertisements while casually browsing. This is true. There is even technology to assist with this in certain web browsers (think of Tivos ability to skip the commercials ;-). However, pay-per-click advertising still has an interesting and important place in the online search game. Sometimes, it is the very best way to find the ‘official’ version of what you are looking for, as opposed to the growing number of online knock offs and squatters. As website registrations have exploded, finding quality content is harder than ever. Sometimes you have to pay to help people to find you.
But just because you are ‘paying for clicks’ doesn’t mean that it is effortless. More to the point, it shouldn’t be effortless, assuming that you care about your ROTI. If you are going to pay to help people find you, you might as well invest that money wisely, and see if we can learn from Marks article to try to distinguish the performance of your ads versus the competition.
Search engine marketing is both an art and a science. In the past year I have spent many hours working on SEM tactics for the HOT- or HomesOpenToday.com website. I am happy to share some hard earned insight from that process.
Lets start with the goal. The goal is of course to get as many high quality visitors to your site as you can manage. This is somewhat different from my experiences with HOT (as I am simply referring consumers to contact the REALTOR holding the open house), but the same basic principles apply. You don’t just want traffic, you want quality traffic. These are visitors who are actually interested in your content - they are a genuine potential consumer of your services, or a ‘lead.’ But even for quality visitors or leads, there is a threshold to what you can manage.
The number one complaint from REALTORS regarding traffic to their websites: “the leads are really quite low quality - they just aren’t that interested or suited to my services (e.g. they are in Michigan and I am in Calfornia). The number one complaint from consumers regarding REALTORS they contact through online channels: “the response time is horrible - I have moved on well before they bother to get back to me.” Clearly there is a disconnect here, and that means a real potential opportunity.
The important lesson here is don’t attract them to your website if you cannot promptly provide them with service when they are ready. The amount of clients that you want to try to service in a given period (effected by your investment in SEM and SEO) will determine how much effort and resources you need to put into whatever channels you have available to service these clients. If you offer a phone number, email, or chat ‘channel’ of communication, what is your response time if I pop in at random? Does it make sense to have an assistant or a service triage these communications so that response time is rapid and your time can be better spent dealing with the next step in the communication/transaction?
Once you have a sense of your business goals in this regard, you can start trying to attract the right number and type of consumers. We have already discussed the SEO aspects of this process. Now lets delve into SEM.
You have a number of choices when you engage in SEM. Some are general (e.g. specific to no particular industry), and some are industry specific (e.g. paying for extra photos on your REALTOR.com property listing). I will address what I am most familiar with, and that is adwords, which is a general SEM marketing tool attached to the google search but also allowing for a range of other advertising channels.
The fun thing about SEM is that you can see what is happening, almost in real time. This is the most significant difference between traditional and online media - feedback. We discussed at length how to approach the metrics available to you in the SEO portion of this article. Pay-per-click solutions typically offer some great tools to give you feedback and even to project what ‘will happen’ if you launch a certain ad. Adwords is no exception. I am able to throttle my bid for clicks in a variety of ways, including time specific, content specific, geography specific and other variables.
Lets look in depth at a pay-per-click campaign. You setup an account, define your campaign parameters (what to call it for your own reference, what the ’subject line’ of the ad is, write about 3 short lines of copy as the ‘body’ of the ad, and then define about 20 ‘keywords or phrases.’) These ‘ad objects’ become the ’sponsored ads’ or ‘paid advertisments’ that you see on pages of websites that have partnered with SEM providers like google. For google’s search engine these ads appear at the top of the search with special highlighting distinguishing them from the genuine search results, and/or on the right hand side.
You can then add additional ad objects to try different approaches or add some variety, and define ‘bids’ for these ad variations. The bids are ‘how much you are willing to pay for a click.’ The bid is ‘attached’ to the ad, so to speak, and then when someone enters a search word or phrase that matches the keywords that you have associated, your ad object ends up in a ‘bidding contest’ with any other ads that also match. Your placement on the results page, whether at the coveted top spot, or further down the page or on secondary pages, is determined in that contest. The more you bid, the higher that you are likely to appear. You can throttle your bid for an ad object for all of its keywords globally, or for each keyword within an ad campaign individually.
For example, if I know that there are a great number of open homes in Concord one weekend in the HOT system, I can adjust my bid for my ad object(s) keyphrase ‘Concord Open Home’ from perhaps .99c per click to perhaps 2.00 per click. That does NOT meant that I will pay 2.00 for each click on that ad object served on google searches for the keyword search ‘Concord Open Home.’ It means that is as high as I am willing to go to try to get great placement. On average the actual cost usually ends up around 60-70% of that total. For instance, when I do have an ad objects keywor(s) set to .99, I usually end up paying around .72/click. At that bid level I get a clickthrough ratio of around 3-5% on the weekends from an ad that is typically placed 4.2 on the page (meaning it is on average the 4th ad down, served on the first page typically). During the week, when people are less interested in searching for open homes, that of course all goes down…. I pay less, for better placement, but get less clicks because there is less searching.
An average of 4% clickthrough ratio (CTR) is phenomenal. It is so good it is actually an aberration. It means that for ever 100 people that see an advertisement served for HOT on a websearch, 4 people click the ad. I have no good way of confirming this, but I believe that this is in part due to the fact that I have a dedicated population of over 10,000 members (between Marks Bayeast Association and my CCAR membership) who are accessing the HOT website. Sometimes they themselves search for the site if they have just learned of it through the grapevine. I can spot this through the keywords that they use to access the site.
But a lot of work has also gone into trying to make that CTR percentage that high. I have written a number of ad variations, with keywords based both off of my research and off of googles suggestions for my business. Google knows what people search for, and depending on your description to them of what you have for people to find, can do a very good job of telling you what to key on in order to get served on a search results page.
I allow the ads to compete with each other, and modify based on performance in an evolutionary process. I vary between serving the ads as fast as possible (on the weekends when most traffic is in the morning for my consumers, who typically search early in the am and make plans for an open house tour) and rotating them evenly over time (on early weekdays when I want to make sure that if someone is searching for open houses even later at night they can find me). I have a geographic range of around 60 miles identified so that I don’t spend dollars on consumers who are not likely to take advantage of my service (HOT currently serves the greater east bay). And finally, I throttle my bids throughout the week. Some weekends I am spending 25 times as much on attracting consumers as I am on a Monday when there are far fewer open homes scheduled to view.
There are a great many more fine details and techniques to both the SEO and SEM game. If the topic merits it, I will write about some of these in more detail in the future. In the meantime, thank you for reading my perspective on this part of maximizing your ROTI in the online world. I hope your online footprint is serving you well, and look forward to discussing more aspects of calculating and maximizing your investment. Remember that content is king, but even with great content you need to optimize your relationship with the search engines one way or another.
And as always, I prepare to do it again. SEO and SEM are both ongoing, evolutionary processes. You cannot just ’set it and forget it’ if you want to maximize your ROTI.
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