Substantiating Search

Marketing research and case studies usually come in handy when preparing introductory statements and background for regularly scheduled marketing meetings. It’s usually nice to have a few third-party bullet points to go along with monthly PowerPoints so as to not transport the boardroom into the bored room.

Over the years, I’ve learned to be careful for what I wish for, particularly when it comes to SEM (define) reports.

In my experience, there’s almost always a naysayer in the boardroom who enjoys nothing more than to throw rocks at third-party studies. Consequently, I’ve resorted to providing a timely email research roundup highlighting specific studies for the group, rather than being forced to steer a runaway presentation back on topic.

Case in point: I recently distributed a few pertinent highlights from comScore Networks’ new study that quantifies SEM’s ability to influence consumers’ latent purchasing behavior. Naturally, I included a link to the study findings so the group could drill down on the data, if they wished.

After preparing a little information on what comScore is, what it does, how it does it, as well as who sponsored the study, I highlighted a few pertinent findings that substantiate SEM’s enduring influence:

In order to understand the latent impact of search on holiday buying patterns, comScore analyzed the time lag between consumers’ initial searches and subsequent purchases made in the same 11 product categories during November and December of 2005.

Notably the study reveals 25 percent of searchers purchased an item directly related to their query. Of those buyers, 37 percent completed their purchase online. The majority of buyers, 63 percent, completed a purchase offline following their search activity. This particular study helps quantify just how influential search really is for the overall buying process.

That’s when a seemingly never-ending email thread began. Some responses to “all” were sarcastic, others focused on transposing the numerical logic while interpreting the results. Initial questions and responses to the research included, but aren’t limited, to the following:

Correct me if I’m wrong, but doesn’t this study show that 75 percent of our search marketing efforts don’t produce a return? What are we spending our money on?

Actually the study affirms our SEM program provides a quantifiable return on influencing buying decisions, more so than other advertising venues, as illustrated in our ROI (define) analysis of our marketing expenditures during the same time frame.

It appears SEM can claim a pertinent role in developing mindshare for our core brands because the study reveals Sis directly bound to influencing buying decisions. That’s just not how people work. There must be other influencing factors on consumers’ buying decisions.

According to the findings, tracking the latent results of searching for gifts on the Web ranked closely with online retail stores and friends and family when it comes to being helpful or influential on the final buying decision. Only physical stores exceeded search on each of these attributes. So the answer to the question is “yes.” Prequalified prospects use search to refine their potential purchases while being highly motivated to buy gifts during the holiday sales season. Tell me something I didn’t know. Is there any other research that backs up this Google study?

A similar, Yahoo-sponsored 2004 comScore study of consumer electronics buying patterns revealed 25 percent of searchers ultimately purchased a product and that an estimated 92 percent of these purchases occurred offline. Among the 8 percent of post-search purchases that were made online, the vast majority occurred in subsequent user sessions.

As noted in the report, the 2005 findings are consistent with comScore’s 2004 report. The study found that more than half (56 percent) of consumers’ online holiday buying actually happened in subsequent Internet sessions, clearly demonstrating the strong latent impact of search. Or clearly demonstrating that few consumers make a purchase directly after completing a single-search click-through. Isn’t Google just trying to sell more ads? We’re not increasing the PPC budget based on this study.

For search advertisers like us, the data do imply holiday-season advertising budgets should be sufficiently large and applied early enough to address the aggressive search behavior of would-be buyers.

Through well-managed keyword bidding and successful day parting, we will address our needs accordingly during the 2006 holiday sales season. As a successful multichannel retailer, the key takeaway from the study remains substantiated: SEM has a quantifiable impact on both online and offline purchases.

Fortunately, the weekend arrived and the email thread died when thoughts turned to leisure time.

Most business executives have grasped the concept of SEM having both a head and a tail. They understand consumers typically begin searches with general queries, then hone their searches to more specific queries that, when aggregated, provide a sizable ROI.

Tap into the search head, and your product or service has a presence. Tap into the search’s tail, and you’ve got sizable search-referred traffic that converts into sales better than more general terms. Tap into both, and you achieve quantifiable latent influence on the overall buying process.

The numbers are there. Now, I just have to commission a report from our internal data services department that proves the point again — with our own numbers. I hope the boardroom’s ready for this. No snooze alarm required.

Join us for Search Engine Strategies in Toronto, April 25-26, 2006.

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