July 8, 2013: A study over at MarketingProfs.com touts the fact that the very top organic ranking on a search engine results page results in a disproportionately large amount of traffic (the study pegged it at 91 percent). Traffic results drop off significantly with the second-ranked (27 percent), third-ranked (11 percent) and fourth-ranked (5.4 percent) listing, with the rest of the lower-ranked listings forming a long-tail curve.
Obviously, the higher you rank organically, the more traffic you get — hence the existence of the SEO industry — but the more complex question pertains to whether it’s always wise to seek the #1 ranking in the paid results, because the behavior observed with organic rankings applies to paid listings as well. Obtaining this position — and the resulting high traffic — in an auction-driven market can be costly, and these costs can be wildly variable (given that competitors may drop in and out of the auction unpredictably and some bidders may be deep-pocketed and be running short-term campaigns that are oblivious to long-term ROI or ROAS). In many cases, it’s more prudent (and profitable) to cede the #1 position to others, and only move up into the top spot when conversion rates for one’s particular market segment are higher (for example, in a given geo or time zone).
Finding these higher-conversion zones, wherever and whenever they exist, is one of the great challenges of paid search marketing. Accomplishing the goal requires bid management technology, a rigorous regime of testing in order to establish the most profitable market segments and their behaviors, and humans in the loop who can both monitor the results of the automation, activity in the auction, and creatively devise testing strategies to probe and exploit unknown areas of opportunity. Doing all this — in real time — may not be “rocket science,” but it comes close.
So yes, we should all strive for top organic rankings and employ those tactics which are allowed by the market makers. But being #1 in the paid search world only makes sense if you’re the most profitable, not the most noticeable.
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