Planning and Measuring SEM Goals: State of Search 2011 pt.1

Decades ago, before we had access to Google, Bing, and the whole of the Internet providing the world at our fingertips, search was a laborious, time-consuming effort.

For instance, if you landed in Honolulu for a 10-day vacation in the Hawaiian Islands and wanted to know where you could find the nearest Puka Dog Hut, you’d have to phone down to the front desk of your hotel and talk to the concierge.

More than likely, they would reply with “Oh, sir, you don’t want to eat that. Perhaps I could recommend the Sansei Sushi Bar for some Asian-Pacific Rim cuisine?”

“That’s not what I wanted. I want a Puka Dog.”

“But, sir, really…”

You get how this is going; we don’t need to belabor the issue. Before the internet, search was cumbersome and unreliable. Therefore, it’s easy to understand and accept the idea that the present state of search is strong, getting stronger every day. How do we know this for certain? The numbers.

I can get a complete listing of Puka Dog Huts in Hawaii from Google in 0.26 seconds. Ease of access is not only turning consumers to search-related resources for their each and every need, but access to this extent is also developing greater and greater levels of impatience in the searchers. We want what we want and we want it now.

Before planning your SEM goals, let’s look at the numbers.

In the State of Search 2011 report, it was projected that search engine marketing (SEM) spending for North America would grow from $16.6 billion to $19.3 billion in 2011. This represents a 14% increase. In fact, the percentage of increase for SEM spending grew 32.19% from 2009 to 2011. That growth rate increase towers over the paltry 19.3% increase that the Oil Drilling Industry saw in the same time period.

Some 54% of all businesses plan to increase SEM/SEO spending, while only 10% plan on spending less (but you can find them in the yellow pages, I’m sure). According to the study, increased spending for 2011 will be focused on:

  1. Paid Search (PPC/Paid Inclusion)
  2. Search Engine Optimization
  3. Facebook PPC Advertising
  4. Search-Related Technology
  5. Mobile Internet

It’s not difficult to imagine that all your competitors are looking into the 2011 and 2012 marketing budgets and figuring out how to spend more effectively on their SEM programs and how to differentiate themselves in the market.

The immediate question for any small business owner is “How does our company define our SEM goals and objectives?” If you like, start with the basics. The state of search 2011 data shows that surveyed business owners plan to allocate their SEM outlays toward the fulfillment of five main business objectives.

Business objectives that companies are trying to achieve through SEM (by percentage of importance):

42% Drive traffic to the website

29% Generate leads

18% Sell products or services

10% Increase brand awareness

01% Improve customer service

The data above shows that a predominance of businesses have come to the realization that converting prospects and generating leads begins with website traffic numbers. Driving traffic to your site is the first step. Converting those visitors into customers is the next. Therefore, your SEM planning has much to do with luring prospects, content development, and on-site conversion rate optimization.

As you can also see from the data above, a slightly-lower percentage of businesses view sales and lead generation as a primary SEM objective. Although much of your typical SEM effort is geared toward getting traffic to the site in the first place, there are many that believe this traffic has an inherent value for outbound sales efforts.

The bottom three responses are fairly typical of SEM and e-marketing efforts in previous years, back when web marketing served to point visitors at product pages and optimization efforts attempted to shorten the path between product and check-out (as if we’d learned nothing from the decades before the dawn of relationship selling).

Note: In the forthcoming State of Search 2011 (pt. 2) article, we’ll discuss defining and measuring social media marketing, but it bears mentioning at this point that increased brand awareness is the top objective for social media marketing.

When measuring your SEM goals, the focus is on data that allows your on-staff SEM, or SEM support agency, to track the progress of a campaign toward your pre-defined objectives (as in above paragraphs). At this time, we are speaking directly about metrics for measuring SEM efforts and analyzing the results. There are a number of avenues for measuring SEM performance, but once again, we’ll return to the survey data to see the top responses from those businesses with active SEM campaigns.

The three most important metrics for use in gauging the success of SEM efforts toward pre-defined goals:

1. Site traffic metrics

2. Conversion rates

3. Click-through rates

Similar to recent years, site traffic metrics and conversion rates are the top two metrics for measuring the success of SEM programs. The click-through rate has seen an increase in importance since last year. Once again, more companies have come to the realization that converting prospects and generating leads with an SEM program will begin with quality ads that draw the eyes and the clicks. No clicks, no traffic, no sales.

In the end, planning and measuring a competitive SEM program first requires a defined, attainable, measurable set of SEM goals. Analyzing the results of your SEM campaign allows your marketing staff or agency to track the progress of your campaigns toward this pre-defined set of goals. And although the metrics for a large e-marketing campaign over a spread of media may include ongoing keyword research and evaluation, web site usability testing, competitive analysis, conversion evaluation, continuing development and testing of PPC ads – your site traffic metrics, conversion rate and ad placement are three top metrics for gauging your success in meeting your SEM goals.

This article was posted in Local Search, Microsoft AdCenter (BING), PPC, SEO, Sweet Spot Marketing, Yahoo and tagged , , ,

One Comment

  1. Posted 20.12.2011 at 2:49 pm | Permalink

    I am glad you pointed out the importance of SEM goal setting. Every online business has to have goals. Period.

    Here is my take on SEM goal setting:

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