Why PPC Prices are a Benchmark to SEO & Online Media Buying
Posted on | March 28, 2010 | No Comments
I had a small insurance brokerage firm call me last week asking me what I could do to help them promote their new website. Well, there’s a lot we can do but when you are in a highly competitive vertical such as insurance you better be ready to commit a decent budget or as an option you can learn how to do it yourself. The average small business however is not tech savvy enough and/or simply does not have the time because they’re already wearing multiple hats.
This potential client presented me their new website. It was decent looking site but sort of template-ish, it had a bad choice for a domain name,. and without any consideration to SEO within the site design. We Search Engine Optimization Professional SEOP’s can immediately tell whether SEO was taken into consideration at the time of website design or not. Anyway, the big question to me was “What Can You Do For Us” I went through the regular process of getting to understand what this client understood of search marketing and such and then we got to the point of talking about PPC. At this point he explained to me that he had worked with a similar company (financial services) in the past and understood that CPC in this area were as high as $9/click. I explained to him that he was correct. His response was “that’s why I want to focus on organic search marketing”. I asked him if he understood that the higher CPC is for a particular business vertical the harder it would be to rank organically. He said NO, I don’t see the relationship. Therefore I decided to blog about.
The economics of marketing are just like any other, they are supply and demand based. They are based on the number of competitors, the future value of each sale, the given level of demand, etc.. If the CPC for a particular keyword is high then most likely the level of competition on the organic side is in relative terms high also. As competition goes up so does the time need to achieve a ranking, as the amount of time goes up, so do the costs related to them. To me this seemed very simple however to some business folk this is a very hard concept to grasp. As a result if you want to buy a Lead from a lead generation company expect to pay more for that prequalified lead for the same reason. If you want to do display advertisng based on a CPM expect that to be high also. You get the pciture.
Tags: cpc > media buy > PPC > search engine marketing > Search Engine Optimization > SEM > SEO
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