Paid Inclusion Pays Off
By Hallie Mummert
With competition for keywords in the pay-per-click (PPC) realm promising to drive rates through the roof, marketers are mulling over paid inclusion as a viable search engine marketing (SEM) strategy. With paid inclusion, marketers pay search engines a fixed rate to ensure their Web pages are indexed. Arguments against paid inclusion tend to center on the doubt that this strategy might not perform well, since it doesn't guarantee high placement in a search engine's organic listings.
But naysayers are losing out on a big opportunity, states Tom Fanelli, vice president of sales and marketing at Coastal Computer Corp., a service management software firm in Fort Myers, Fla. Working with Boca Raton, Fla., SEM firm MoreVisibility, Coastal reaped a 400 percent return on a $7,000 paid inclusion investment during a recent 14-month period, showing that this strategy can hold its own.
Here, Fanelli talks about the value of paid inclusion in a robust SEM program.
Target Marketing: What are the goals of your SEM program?
Fanelli: There are three different tiers to our SEM program: search engine optimization (SEO) on a continual basis; standard PPC positioning; and paid inclusion.
All of our SEM efforts are geared to driving traffic and getting those visitors to download a demo or collecting some information on them.
Our sales are made in an offline fashion after the trial, which makes it trickier to track conversions. We spent about a year analyzing data from a broad spectrum of keywords, and learned that the 80/20 rule [applied to our SEM efforts]. When we found that 20 percent of our keywords were generating 80 percent of our sales, we focused on those.
Using a hybrid tracking solution, we track SEM efforts on a per-keyword, per-engine basis. We found some keywords, like "inventory software," can drive traffic and demo downloads, but not … purchases. We dropped words like this that don't bring good ROI. Unless you're tracking ROI on a keyword basis, I liken it to flying a plane without any instruments.
TM: What role does paid inclusion play in meeting your SEM goals?
Fanelli: Paid inclusion allows us to achieve [search results] page saturation, where our key terms are given a higher chance of capturing search users. Studies find that people are skipping over the paid listings, so we get a higher chance to be viewed in the [organic] listings. Also, paid inclusion allows us to lower our program costs [through] a fixed bid rate that, as long as we're doing our job with our sales [follow-up], can get better ROI than PPC rates.
TM: What other benefits do you derive from paid inclusion?
Fanelli: Experimenting with keywords is much less costly than with PPC on Google.
TM: Are there any downsides to using paid inclusion?
Fanelli: One of the downsides is if I could generate 400 percent [ROI] all day long, wouldn't I spend more than $7,000 [over a 14-month span]? Yes, I would, but the downside of search is that there's only a certain amount of qualified traffic on the Web. You end up casting your net wider and wider, resulting in traffic that doesn't deliver the ROI.
Another downside is that paid inclusion doesn't necessarily deliver the same volume as being in the top one, two or three [positions in the] paid or [organic] listings.
TM: How will you leverage future paid inclusion efforts?
Fanelli: We're going to … expand our keyword list. I feel we have some room to move around and get experimental with fringe terms. We started [our paid inclusion efforts] with 20 core terms, and now we're going to add more terms, expand our net and see if it doesn't [drop] our ROI much.