Search is Driving eCommerce

Internet Retailer found that search engine marketing drives more than 50% of sales for 30% of the respondent retailers. The race for the best key words and an alternative to Google is on.

Search engine marketing is more important to virtual merchants, of whom 40% attribute more than half of sales volume to search, than store based merchants or consumer brands. But across the board merchants are shifting strategy and cash to optimize search results though only 26.4% are outsourcing the task and most see search engine skills as a necessary in-house competence.

Natural search is perceived as better in terms of conversion rates compared to pay-per-click (46.1% versus 37/3%). Almost two-thirds (64.4%) say pay-per-click yields a 6% conversion to sale or less while natural search is credited with 10% or more of purchases by 18 percent of responders.

57 percent of merchants in the survey score search as better or much better than other marketing tactics, a third of whom are spending more than 50 percent of their marketing budgets on search engine marketing which is somewhat or significantly higher than last year for more than half of participating merchants..

Three-quarters are buying from Google versus 13% for Yahoo; the closest competitor. Yet the same three-quarters say they are marketing on unnamed specialized search engines

Keyword inventory practices are evenly split. One-third uses 100 words or less, another third manages 101 to 1000 words and the final third manipulates as many as 1001 to 10,000 words Fifty-eight percent spend between 16 and 75 cents per keyword which suggests either that clever copy writing and phrase-making and/or modest traffic is keeping search affordable or that retailers are limiting or parsing their spending.

It will be interesting to see if these words correspond to the words used in traditional media that the Retail Advertising and Marketing Association claim drive people to search in the first place. According to research from RAMA and BIGresearch half of consumers take cues from TV and print when they search online.

Search clearly is the battleground for retail eyes and clicks. Retailers will be scouring the planet for ideas and talent as demand and prices steadily escalate. Stay tuned.