Friday, April 6, 2012

Google: Paid Search Ads With Associated Organic Result Have Higher CTR [Study]

A new Google study examining the impact of organic listings on ad click incrementality finds that the click-through rates (CTR) of ads with associated organic search results are higher and that the CTR increased the higher the organic result was positioned.

81% of Displayed Search Ads Have No Associated Organic Result

Google SERP Buy Shoes Online

Key Findings and Recommendations for Marketers

Google’s study is a tough, technical read and not for the faint of heart. Google obviously has a vested interest in selling advertising; as with any research, it’s important to consider the source.
However, Google is open about their methodology throughout the report and encourages marketers to test the theories themselves. Overall, the report offers a number of useful insights.
It boils down to:
  • 99 percent of ad clicks with no associated organic result are incremental.
  • 50 percent of ad clicks with an associated No. 1 organic result are incremental.
  • 82 percent of ad clicks with an associated No. 2 to No. 4 organic results are incremental.
  • 96 percent of ad clicks with an associated organic result ranking No. 5 or lower are incremental.
What does all of this mean for you? Google recommends that advertisers use value-per-click calculations to help decide how much to spend on branded terms, given their typically high organic rank. They also suggest that marketers use their own randomized experiments, such as geo-based experiments, to better quantify ad clicks that are not replaced by higher ranking organic results.

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