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Why You Need to Move your Spend from PPC to SEO

Posted by Tim on 03-Apr-2020 10:51:26 | 4 Minute Read

When people are buying products and services paid search, also known as Pay Per Click or PPC, can be a great tactic to use to get people looking for what you are doing to buy from you. Or if it is an offline purchase, submit a lead form to start the purchase conversation. You pay your money for the click, get people to the site and if the conversion metrics multiplied by the cost per click (CPC) work you get leads at a profitable level. But paid search works on the here and now. What if those conversion metrics plummet? Even with rapidly dropping CPCs, when people aren’t buying paid search simply doesn’t deliver.

Risks of reliance on paid search

Google-ads-laptop-1We have always talked to people about paid search being part of a complete package of traffic driving tactics to websites; certainly not the only tactic. In fact, we have worked hard to wean some client businesses off paid search when we have started working for them and found their whole revenue generation model based on paid search. PPC has two fundamental risks to it as your primary revenue driver:

  1. It relies on immediate (or close to immediate) purchase
  2. It is very vulnerable to competitor activity

The second of these is the fact that if your competitors are prepared to pay more money you get squeezed out of the auction for the search term and find your business with less traffic, less sales and not hitting targets. In the good times this drives unwary advertisers to pay more and more for those clicks as they get into a bidding war with competitors. Until a point where cost vs conversion makes it utterly uneconomic – however we have seen bidding go well beyond breakeven. However, that is not the problem now. The problem now is, with PPC you get an instant hit. If you turn it off, you get no residual benefit. If people aren’t buying now you don’t get a return on your marketing investment in PPC.

Organic search / SEO – an investment not an expense

PPC is a marketing expense. You pay the money; you get a return then, or you don’t. Organic search engine optimisation (SEO) is not an expense, it is an investment. Sometimes people don’t want to do it because it takes time, it needs to build, it is complex requiring a combination of technical, structural and content elements, but this is also why it is such a good investment. It cannot be done fast, so it cannot be undone fast by your competitors. Once you are in the top ten or top three for a search term organically you are likely to stay there for weeks at least with little or no further maintenance, but months if not years with good on-going ‘organic search maintenance’. It is for this reason that when you spend on organic search you are building an asset of your website.

The power of organic

Achieving high organic rankings also gets you proportionately much more traffic than paid search. Google Ads has benchmark Click Through Rates (CTRs) of 2% and even at IV when we can achieve average CTRs of 5% or so on paid search this still means paid advertisers are getting a very small slice of the search traffic for that term. 95% of the people you want to engage with ignore your ad. Compare this to a top three organic result where you would be expecting to receive 10-25% of the traffic for that term. Multiple times more traffic for the same term mean greater penetration into the opportunity space.

There is also the factor of the way that organic search works compared to paid search. Advertisers have generally had to pull back from broad match terms, or even broad match modifier use in order to achieve positive return on investment (ROI) on the paid campaigns. Going too broad wastes budget when only a small proportion of those people captured by the broad match are good fit for purchase. You don’t have that issue for organic because if you are ranking well for a lot of broad, related terms and you get traffic that isn’t quite right to buy you haven’t wasted budget as it doesn’t cost you any more to get them on your website. You get the benefit of those other good match buyers coming from these wider terms, so there is only upside.

Brand power of organic

The thing that you cannot buy with paid search is the halo effect that businesses and brands get from ranking highly organically. Consumers think “Well if Google puts them no.1 they must be good at X”. While digital marketeers may know that being top of Google doesn’t mean the best product or service, but the best investment in SEO consumers don’t. They see the fact that you appear high organically as a reflection on the ranking on what you do. We regularly see that conversion rates for organic search is much higher than paid search. Even when you take into account the impact of brand term search (people already knowing you and searching for your brand) the likely conversion of organic traffic is higher for the same term.

Why investment in organic search now?

The data says with organic search you get a greater share of traffic, you get a wider base of searchers without downside, they are more likely to convert and there is the positive brand impact. It seems logical that you should be investing more (and that means prioritising organic ranking factors over vanity factors such as stripped out navigation and excessively large image files!) in organic search all the time. We think that is true and is the best value use of digital marketing spend for many businesses. By why now?

The current economic downturn makes that PPC spend uneconomic but spend that money on improving your organic search and you are building the asset. This asset is the increased organic rankings that are going to build over the coming weeks and months of your investment. While your competitors might be cutting back you have the opportunity to get ahead of them for when the times start to turn. As you cannot rush the organic rankings by the time they see that you have overtaken them in organic search it will take them time to react. If you keep investing, they won’t be able to take those rankings back.

Investing in organic search and making your website an asset is going to deliver returns for the long term. A disproportionate investment in organic search now may see only low returns initially while the overall search traffic is still compromised by the effects of recession, but as the market expands you will be in pole position to beat the competition. You simply can’t do that with paid search.

Invest or cut

We have some other blogs about how businesses can best weather the economic storm, not just to survive now but to ensure that they prepare themselves for the brightest possible future. The businesses that will succeed will make cuts in certain areas, but they will also know what areas not simply to cut but to increase investment in. The decisions you make now will be ones that your business will need to live with for years to come. If you want to discuss the specifics of your options around marketing budgets, then please feel free to get in touch. We have a lot of experience and expertise within the team to help you uncover the information you need to make the right decisions for your business.

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If your business needs strategic help during these challenging times, we are happy to chat things through with you to help at no cost. You may or may not want to take that conversation forward, but we want to use our skills to help as many businesses as we can at this time.

Topics: SEO, PPC, Strategy