Thursday, March 22, 2007
Travelocity's chief marketing officer Jeffrey Glueck recently spilled out some ROI numbers on paid search that has the industry buzzing. Glueck said 96 percent of Travelocity's conversions came from branded keywords used for paid search.
Travelocity's numbers focus on the real ROI of search marketing, and build a convincing case for branded keywords against non-branded keywords, which converted into a booking just 4 percent of the time.
While the numbers are convincing, Glueck has not addressed in sufficient detail the idea that non-branded keywords are used mostly in the research phase of the search experience.
The ROI on that presence during research may not be directly measurable, as Glueck would like, but it stands to reason that it is important to have your brand present wherever it matters.
But for good measure, we'll consider Glueck's stats, as presented at the IAB's Performance Marketing Forum:
* 2% of paid-search conversions originated from a searcher clicking on a non-branded term and then a branded term later
* According to 360i, branded keywords account for just 5% of search marketers' total spend, but account for 80% of profits from paid search
* 65% of Travelocity paid-search visitors arrived via one ad from one keyword
* 27% of Travelocity paid-search visitors clicked ads multiple times via the same keyword repeatedly
* 8% used a variety of keywords
* Geo-targeting works: local flight information offered in ads converted 6 to 7 times better than ad banners
Glueck told AdAge, which has more stats, that it was a "profound mistake by all of us to think we've figured out how to measure ROI on search. We're in stage one."
Established businesses should test the use of branded key-words. The key is to develop campaigns that last for a short 'testing period'. Once you've established a base-line, measure through to conversion and see if you've improved your ROI.