How our test site derived 90 percent of its traffic from Google, and reduced its cost per click by 43 percent
Test Number: #060503-SE
Word Count: 4200+
Focus: 9 Questions
Editor – Flint McGlaughlin
HTML Designer – Cliff Rainer
Contributors – Aaron Rosenthal
Our next report addresses affiliate programs/strategic partnerships.
Most affiliate programs are a waste of everyone’s effort. But when you have bought all the pay-per-click traffic you can afford and when you have exhausted all of the traditional Internet channels you can find, how do you bring your site to the “next level”?
Affiliate programs are often the best answer, and they can be extremely effective IF executed correctly.
In this report, we will examine successful merchants, test cases, and software providers. And we will show you how one (small) retailer achieves more than $9 million a year with just 50 affiliates.
We are also working on several other research projects, including:
How retailers and publishers can use eBay and the auction sites to sell products and to increase website traffic. (Our research site generated $1 million.)
How to MAP YOUR SITE’S MESSAGING to optimize the yield per visit. (This is one of the most effective ways to increase your revenue without increasing your marketing budget.)
How to increase your customer retention and customer value with carefully crafted email. This is one of the most overlooked opportunities in (even mature) marketing operations.
How to reduce your abandoned shopping carts, dramatically improve your conversion ratio, and (once again) increase your revenue without increasing your marketing budget.
How to effectively combine offline and online marketing. Sometimes 1+1=3. Most marketers are not maximizing the potential synergy of “click and brick”.
Study The Data from This Test
Google PageRank (not to be confused with Google AdWords (*1)) is a free service. So how can this mathematical wonder — spawned by some sixty PhD’s — drive 90 percent of your search traffic and reduce your overall cost per click by 43 percent?
Researchers at MEC have been studying the vaunted PageRank (*2) system for the last six months. Our objective has been practical, if a bit daunting:
To cut through the myriad of complicated algorithms and articulate a simple way to increase your Google traffic.
It has not been easy — especially in light of Google’s esoteric explanations:
Buried deep within the Google website, we discovered a fascinating secret. Google attributes its stellar search results to its patented “low-cost pigeon cluster” technology (really!). Here is a quote from their site:
“By collecting flocks of pigeons in dense clusters, Google is able to process search queries at speeds superior to traditional search engines, which typically rely on birds of prey, brooding hens or slow-moving waterfowl to do their relevance rankings.” (*3)
If you are confused, so were we — or at the very least amused. We thought it might be helpful to focus our research on elements more practical (but less enjoyable) than the state of Google’s pigeon (Columba livia) coops.
We will attempt to address the most relevant questions and blueprint a step-by-step process for achieving a high Google PageRank. (Our PigeonRank research will have to wait for a more opportune time.)
How Important Is A High Google PageRank? (We test the impact of PageRank on a website’s overall traffic.)
Because it is so much faster to buy a good search position with the pay-per-click engines, marketers often avoid the serious effort it takes to achieve a high Google PageRank. Search engine optimization becomes one of those important “To Do’s” that keeps getting “put off.”
Even at MEC, we have not optimized our site for PageRank (Though we have attracted more than 13,000 incoming links, and we have optimized other test sites). What is our (dubious) excuse for this delay? We have waited to complete the research you are now reading.
So… it is FINALLY completed, but what have we learned?
How important is PageRank, really? Where should you rank it on your list of priorities as you battle with the “URGENT” and the “IMPORTANT”?
In the first phase of this project, we conducted a simple test to determine how Google PageRank could impact a website’s total unique visits. We focused on measuring, as a percentage, how much of the site’s overall traffic came from Google’s main directory.
NOTES ON OUR METHODOLOGY
First, we measured how much traffic came from Google before the site was submitted to any search engines. That is — how much traffic came as a result of Google’s own spidering activities.
Next, we manually submitted the site to thirty search engines. (*4)
Then we measured once again how much traffic came from Google compared to all of the other search engines.
RELEVANT BACKGROUND INFORMATION
The test site was launched in early 2001.
The data for this test was compiled with WebTrends Live.
The site’s primary offering was an information product.
The site did not conduct any pay-per-click marketing.
The following table shows the percentage of traffic from Google for 60 days prior to the submission, and for the 60 days immediately after the submission:
|Percentage of Site Traffic
From Search Engines
|60 Days Before Submission|
|60 Days After Submission|
|Since Site Launch|
What You Need To UNDERSTAND: Before AND after the general search engine submissions, Google drove more than 90% of the test site’s traffic. (See next paragraph.)
KEY POINT: As of this writing, Yahoo! also derives its search results from Google. This dramatically changes the numbers:
|Percentage of Site Traffic From Google|
|60 Days Before Submission||91.31%|
|60 Days After Submission||91.03%|
The search engine submission effort yielded no measurable increase in traffic.
The free/pay-per-inclusion search engine landscape has changed dramatically in the past 24 months. Yahoo’s purchase of Inktomi could alter this landscape yet again.
KEY POINT: Google is dominant. Here are some fast facts on its industry position: (*5)
Google receives 250 million searches per day.
Google controls roughly 40 percent of the market. In February 2003, it received 83 million more searches than Overture, its nearest competitor. (*6)
Google searches more than 3 billion web pages.
Google attracts 73.5 million unique visitors per month (Nielsen/NetRatings 2/03).
Google offers its results in 35 languages and 50 percent of its traffic comes from outside the U.S.
Google has 800+ employees with 60 PhD’s on staff.
It seems clear that the aggressive marketer should focus some of her attention on PageRank. But many marketers have overlooked how to use the free/pay-per-inclusion engines to reduce their overall cost per click.
How can you use Google PageRank to reduce your overall cost per click and thus your overall cost per customer acquisition?
Many e-commerce businesses live or die on the cost of their “clicks”. Indeed, we have seen major “dot-coms” crash as the result of a slight increase in their customer acquisition costs (CPA).
We often interview CEOs and marketing directors, and while many are able to tell us their average cost per click in Overture, Google AdWords, or FindWhat, many more cannot tell us their OVERALL cost per click.
This is dangerous.
To illustrate the significance of this metric we have prepared a simple chart. The numbers are adapted from a functioning e-commerce website.
NOTES ON OUR METHODOLOGY
First, we tracked the number of clicks generated by Google AdWords and we calculated the average cost.
Next, we tracked the number of clicks generated by the Google directory (*7). There is no charge for these clicks.
Then, we calculated the total clicks and divided them by the cost.
RELEVANT BACKGROUND INFORMATION
The site has been in operation since January 2000.
The site’s primary offering was a selection of 700 household items.
The site is projected to do just under $500,000 in annual gross sales for 2003.
The data collection for this test was through the Google customer panel.
|Google PageRank’s Impact
On Overall Cost Per Click
|Click Source||Number of Clicks||Campaign Costs||CPC|
|Combined Traffic Driven by Google||37,526||$3,446.96||$0.09|
What You Need To UNDERSTAND: When we factor in the traffic from The Google directory, we reduce the overall cost per click by 47%.
Google ranks your site on a scale of 1 to 10. Their ranking is based on several elements. One of the most important is the hypertext links coming to and departing from your site. Google considers two factors:
Google considers the NUMBER of legitimate links to your site. It treats them like votes.
Google also considers the QUALITY (PageRank) of the sites that are linking to your site.
KEY POINT: So what is a good ranking? According to one SEO (*8) marketer: “A high [PageRank] can be deemed as anything over 7.” Others have argued that anything over 6 is good.
But what is your site’s PageRank? What is your objective: a PR7, a PR8, or a PR9? What are the PageRanks of your top three competitors?
Whatever your objective, your questions may be moving from the “what” to the “how”. And “how” to achieve a high Google PageRank is the focus of the next section.
Section 2 (Continue…)