, The Online Spend Disconnect – PPC And SEO

The Online Spend Disconnect – PPC And SEO.

November 17, 2008

An interesting post over at SEOMoz highlights the spending disconnect that exists in the way that many companies allocate their online marketing spend.

Not surprisingly, search advertising should continue to be the largest category, growing from $9.1 billion in 2007 to $20.9 billion in 2013.
– Source: C|Net News, June 30, 2008

While the current spend on natural SEO?

SEO: $1.3 billion (11%)
– Source: SEMPO data via Massimo Burgio, SMX Madrid 2008

So, out of a total of around $10.4 billion spent on search, only $1.3 billion, or 12.5% is spent on natural search placement. Therefore you would expect the potential traffic from natural search to be the smaller piece of the pie, right?

Wrong.

Looking at the Google heat map we can see that it’s the natural results that catch the attention of users viewing the page.

, The Online Spend Disconnect – PPC And SEO

This superior visibility is matched by the click through rate data,

, The Online Spend Disconnect – PPC And SEO

The natural results in Google drive more than 70% of search traffic, though only account for 12.5% of online spend.

Why is this? Take your pick from any one or more of the following,

  • PPC is an easier concept for people to understand, there is a general lack of education and understanding of the SEO process.
  • PPC is quicker (almost instant) to get results and you only pay for traffic that you actually receive. There is a higher perception of accountability and control.
  • Traditional marketers pay far less attention to SEO, column inches in the business press given over to SEO are far less than PPC. Again this may well be due to a lack of SEO understanding amongst journalists.
  • There is a lack of trust in a segmented and unregulated SEO marketplace. A basic lack of understanding handicaps buyers and can lead to acceptance of poor advice and wrong buying decisions.