Issue #56 introduced a review of the “Less is More” approach to Paid Search marketing, as outlined at Search Engine Watch by Pat Stroh. This week, the conclusion of this series will look deeper into some possible additional factors to weigh in deciding whether or not to use this approach.
The rationale for the “Lees is More “ approach is as follows: before the big media push, there were searchers who were inclined to find the brand and did so of their own accord; following the media push, there will be an increased amount of newly aware searchers. This group tends to convert at a much lower rate than those who were actively pursuing the brand, with minimal influence from additional media sources. Stroh does not suggest that opening budgets in response to an offline push always leads to lower conversion rates, but it is a possibility marketers should be aware of. He suggests an alternative approach for budget-conscious brands during an offline push – lower bids and position and do not increase budgets. In theory, this will compensate for the lower conversion rates due to searchers driven by heavy promotion.
There are two things at play beyond the straightforward impact of offline promotion on conversion rates that are not covered in Pat Stroh's piece. First, by selecting broadcast media channels for offline promotion, the advertiser has likely made a conscious decision to target users earlier in the decision-making process, which in nearly all cases would come with a higher allowable cost-per-conversion. If this is the case, perhaps allowable CPAs should be adjusted during these periods to account for this type of strategy. In addition, while hard metrics around the banding value of search have been elusive, AA|RF has conducted several studies to quantify just that. A financial services client recognized 77% gains in message retention and 44% gains in unaided consideration when comparing users who were exposed to premium position search ads as compared to no presence at all. Cleary this indicates that there is value in presence alone. If marketers can quantify the branding impact of search, maintaining higher position during offline spikes may be justifiable.
Regardless, both of these approaches are worth testing when looking to align with more traditional media efforts. Provided goals are established upfront and strong metrics are in place at the outset of the test, it remains to be seen whether a brand can truly achieve greater ROI with less media budget, or if extending those budgets is the more profitable approach.