Why Should I Buy Keywords on Yahoo! and Bing?

Jan 27, 2010 View Comments by Kupr
Google dominates with a significant share of total searches

Google dominates with a significant share of total searches. Source:Hitwise UK, 4 weeks ending, 23/01/10

You are probably well aware that the search landscape is dominated by Google.  Both in natural and paid search.  In fact the latest figures report that Google has 89.68% share of total searches.  Yahoo! stands at 4.72% and Bing at 3.07%.  With that large slice of searches, it is of no surprise that Google delivers the majority of traffic and sales volumes to most advertisers websites.  Most sensible individuals would spend their precious working time focusing on the area where they can make the biggest differences to a search accounts performance, and as a consequence, would result in spending a significant of your time on managing paid search campaigns on Google.

However, as you look across at more performance metrics, it can become clear that Google is not always the most efficient of the big 3 search engines.  Whilst Google may deliver the biggest number of sales, it is very often Yahoo! and Bing that provide the best conversion rates and ROI.

The data below is taken from a travel advertiser for the last 12 months.

Here, we can clearly see the difference in performance across the 3 engines, with Microsoft’s Bing providing far more bang for your buck, with the lowest CPA, highest conversion rate and biggest ROI.  On these same metrics, Yahoo! also outperforms Google.

The main reason behind the performance on Yahoo! and Bing is down to the price of CPCs.  With the lions share of advertisers being drawn to Google’s Adwords program, competition on keywords is fierce, and this contributes to a search landscape that has inflated costs.  Conversely, with slightly fewer advertisers, CPCs on Yahoo! and Bing tend to be cheaper, which helps to boost the ROI.

Many search managers are familiar with the concept of long tail terms, which are keywords that have low search volumes, cheap click costs, but importantly good conversion rates.  For me, Yahoo! and Bing are long tail search engines, with the expensive ‘head’ being occupied by Google.  A good search manager will know that a successful account is built around the balance between large volume generics, that deliver the majority of sales volume, and the long tail delivering  lower, but far more cost efficient sales.  Clients rarely have just one target, but something more akin to ‘deliver X sales at Y ROI/CPA’.  Being able to deliver sales across the breadth of the generic-long tail scale is crucial to hitting campaign objectives, and as a consequence, it’s important to include Yahoo! and Bing in strategic plans.

Also during these frugal times, many people have reduced their marketing budgets, although slightly less in paid search as it is so immediate, measurable and efficient compared to other channels.  This has often resulted in under resourced Google campaigns that have not been able to operate at their previous levels.  A solution is to divert budget away from the expensive Google landscape, particularly generics, and shift spend onto Yahoo! and Bing where conversions are more cost effective.  This will help in achieving overall targets for a search campaign.  The downside is that you are likely to see a drop in sales volume, and this is an expectation that will need to be managed with the client, or a better option will be to explore where else that volume can be driven from, for example, perhaps from increasing commission on your affiliate program.

Of course, with Microsoft’s overhaul of their system and backed by a huge ad campaign, Bing is slowly taking market share.  What will be interesting, is to see if Bing can both increase sales volume, and also maintain those better conversion metrics.

So to conclude, yes Google has the majority of traffic, but that does not mean that it should be the only search engine you invest in for paid search as Yahoo! and Bing still have an important part to play in helping deliver on campaign targets.

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