Two Search Budgets for One Business?

PPC (define) search leaves no room for a siloed marketing department, yet nearly every advertiser, large and small, runs paid search in several silos simultaneously. Some marketers consider paid search purely a “last touch point” direct response (DR) ad vehicle. Others, while acknowledging there’s some buy funnel impact, address the issue by running simple portfolio-based campaigns that have little to do with the value that could be imparted to the enterprise via a holistic approach.

The time has come for the craziness to stop. Marketers must finally embrace the concept of integrated marketing relative to media budgeting and strategic marketing communications planning. The current system of evaluating DR media on a purely DR basis, while evaluating brand marketing solely on a lift in brand metrics or a demographic/psychographic fit, results in spending mismanagement, poor budget allocation decision making, and a failure to take media interaction effects into account.

Sure, the ideal is a media mix model that analyzes the impact of all media on eventual sales, profit, and lifetime value (LTV). Yet those models are too complex for most marketers to master. The first marketing silos to be obliterated are the brand budget silo and the DR budget silo, as well as any interactive ad budget, which often resides with another agency. Three budgets, three agencies, several sets of success objectives, none of which fully reflect the way a consumer arrives at a purchase decision and becomes a customer (or returning customer).

Can things get any crazier than this?

As if mega-budget silos for brand, DR, and interactive weren’t bad enough, there are additional budget silos for PR and promotions. Your Web presence and search in particular aren’t simply a new form of media. Search traffic (organic and paid) is the result of consumer behavior that is, more often than not, stimulated by media, advertising, PR, or word of mouth. Nonsearch media, such as contextual and behavioral clicks, are also a result of consumer choice, when purchased on a CPC (define) basis.

In all CPC media, consumers who have better things to do nonetheless opted to click on your ads. The act of clicking is an expression of interest. So the landing pages you present, your site presence, and all the content you provide are critical to marketing. Failure isn’t an option. Just as offline retail advertising drives consumers into a store and business-to-business advertising drives potential buyers to engage by phone, via online, or in person, a Web site and all the media that drive visitors must work in concert.

Brand marketing, DR, PR, promotions, and search all share the same goal: a profitable enterprise that acquires new customers and maximizes revenue and profits from all customers (high share of wallet). Philosophies of the different marketing disciplines diverge primarily in respect to the best way to accomplish these goals and measure effectiveness.

No single medium, ad, or marketing discipline generates pure direct response or branding impact. All deliver some combination of marketing value to the organization. In search and online auction media, managing by either DR or brand metrics alone result in a non-optimal campaign. Bid prices and advertising messages are lopsided. Specific campaign budgets fail to take into account metrics that actually lead to eventual purchases, profit increases, and long-term revenue.

PPC search marketers must be among the first to take an integrated approach to marketing. In an auction media marketplace, failure to bid appropriately when the competition is behaving more holistically means in the long term, they’ll win. The solution isn’t a simple portfolio campaign where high ROI (define) keywords subsidize keywords with lower conversion rates or ROI. The correct way to address campaign planning is to be customer-focused. Only by understanding the way customers buy can you hope to spend effectively by influencing customers positively.

A holistic search solution isn’t about bidding alone. It’s also about messaging. Someone not ready to buy responds negatively to call-to-action messages targeted at late-stage buy-funnel prospects. Early-stage buyers need information and education about why your product or service should be atop their final consideration set. If you’re a value, service, luxury, prestige, or price player, messaging must be consistent throughout the buy cycle.

Look at the SERPs (define). If your competition ranks higher than you do, it may not be because it has better conversions or is an irrational bidder. It may just have a more holistic approach to search marketing, having moved beyond a “search engine sales” DR-only budgeting process to a holistic brand/DR hybrid.

Want more search information? ClickZ SEM Archives contain all our search columns, organized by topic.

Kevin is off this week. Today’s column ran earlier on ClickZ.

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