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Time to Balance Your Marketing Portfolio?
We all want to have more money. Even mega rich guys like Warren Buffett.
But there's a big difference between a chap like Buffett and his counterparts of the dot com mania. First and foremost, a share in his company, Berkshire Hathaway, will set you back $80,200 as of close on November 5th. Secondly, Buffett believes that if a company cannot have a long-view on its business outlook, creating value for its shareholders year after year, then it's probably a dog. And the dot com era was the kennel of such canine.
What does this have to do with Internet marketing?
We're settling into an era where mainstream, value-oriented businesses are embracing the Internet as a serious business channel. As a result, savvy companies are finally bringing together their marketing, IT, and finance departments to determine a long-term, positive return-on-investment strategy for their marketing and sales efforts. And they're starting with Internet search visibility.
For most businesses, over half of their web site traffic will originate from a search engine. Extrapolating that, over half of online leads or sales will come from people searching for your products. So, the more visibility you have on the search engines the more business you can get.
Investing in your visibility on the Internet search engines is like constructing a portfolio of diversified investments. There's speculating, and there's investing. You need balance. Speculating in the Internet search engine marketing space is equivalent to investing your entire marketing nest egg into paid listings such as Google's AdWords or Overture's pay-per-click listings. You're bidding against others in the hopes of gaining visitors while driving up the price of the "stock" (the listing). The results can be immediate (if you know how to convert visitors into leads or sales) but expensive.
On the other hand, savvy marketers are learning to invest in a more long-term strategy by optimizing their web sites to achieve natural search listings that appear at Google, Yahoo, MSN or other Internet search engines. Natural search listings are those results that appear directly below paid listings. The vast majority of Internet search engine users (some 70 to 80 per cent) click on natural listings. Only 20 to 30 per cent of all Internet search engine users click on paid listings. As such, we at Ciceron have found clients receiving over three times the online sales and/or leads from their natural search listings as compared to their paid listings at a fraction of the cost.
Similar to constructing a solid portfolio of value investments, achieving natural search results takes time - a year at least to full maturity for a well-rounded program. It's hard to think in those terms when it comes to the Internet. We have come to expect everything to be immediate. But not when it comes to natural search optimization. To quote Benjamin Graham from his classic treatise on value investing, The Intelligent Investor, "Through all their vicissitudes and casualties, as earthshaking as they were unforeseen, it remained true that sound investment principles produced generally sound results. We must act on the assumption that they will continue to do so."
Proper allocation of investment towards natural search listing optimization is very consistent with such sound investment principles championed by the likes of Benjamin Graham and Warren Buffett. There is intrinsic long-term value in this investment. And if properly implemented and managed, it has the potential for returns similar to Berkshire Hathaway's run from 1965 to the present.
Until next month,
Andrew Eklund
CEO
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