Paid Search and Spend Breakdown

Just read an interesting article based on a survey that was sponsored by WebTrends about paid search (SEM).

Some of the highlights from the article/survey include:

• 22 percent saying they run 1,000 to 10,000 keywords
• 31 percent stating they use 1-1,000 keywords
• 21 percent indicated they are running over 10,000 to more than 200,000 keywords

Most respondents indicated that they use multiple metrics for measuring success:

• "traffic" being the top choice at 44 percent
• "conversion" at 34 percent
• "cost per action" at 22 percent

What I found disturbing is that only 14 percent of marketers who responded indicated that they use "profit" to evaluate the success of their paid search campaigns. While I understand that measuring profit may not always be easy especially, when identifying web site conversion points is already difficult on most no e-commerce web site, however, not paying attention to profit or ROI means, that marketing mistakes will be repeated.

From a practical stand-point, I just believe it is laziness in configuring web analytic tools to measure conversions and assigning a value (profit) to these conversions. Followed by applying this revenue to the cost of the campaign for a clear indicator of ROI/profitability.

Read the full article - it is well worth the read