Practical Ecommerce

SEO and PPC: Synergistic or Cannibalistic?

Many ecommerce managers wonder whether the paid search ads they place enhance or cannibalize the organic search results. They wonder, in other words, if they end up paying for clicks they could have had for free organically. A recent study by Google suggests that the relationship between paid and organic search is more synergistic than cannibalistic.

Top organic rankings in the major search engines can be construed by consumers as endorsements of those top-ranked sites. If Google ranks a site number one it must be the best site, right? Ecommerce sites in the trenches know that’s not always the case. We’ve written about ways to increase search result visibility with rich snippets in “Capture More Search Traffic with Rich Snippets,” but there are other ways as well. Google’s latest findings on paid and organic search results suggest that paid and organic listings are mutually beneficial.

50 Percent Incremental Clicks

Zoom Enlarge This Image

Google's Study: "How Paid Search Incrementality Is Affected by Organic Search Rankings."

Google’s Study: "How Paid Search Incrementality Is Affected by Organic Search Rankings."

Google recently released its results in a blog post — “Impact of Organic Ranking on Ad Click Incrementality” — including the news that 50 percent of the clicks on AdWords campaigns that occur when the same site is also ranked number one organically are incremental. For example, if a hypothetical site typically received 100 organic visits from Google from a certain number one ranking and 100 paid visits from that same keyword phrase, the site would only receive 150 organic visits if the paid search ad was paused. So yes, the site ends up paying for some of the visits it could have had organically for free, but it can counterbalance that cost with the additional visits it wouldn’t have received if the paid search ads weren’t running for that keyword. The return on investment for this relationship may be positive or negative depending on the site and the keyword phrase.

To determine this, Google studied 390 paused search ads to determine the difference in click-though rate between organic and paid ads. The original study in August 2011 was highly questioned by the SEO community due to a low number of simultaneously occurring organic and paid search results. Google’s follow-up study controlling for simultaneously occurring organic and paid search results was released in late March 2012.

Lower Rankings and Higher Paid Ad Performance

In addition to the 50 percent incremental click through when paid and organic both rank highly, Google also found that lower ranked organic results produced higher incremental paid search click through. When the organic search result ranks between position 2 and 4, 82 percent of the ad clicks are incremental, and 96 percent of the ad clicks are incremental when the advertiser’s organic result ranked in position five and below.

Google is quick to note, as it should, that individual sites’ performance may vary. Ecommerce sites can run a variation of this test themselves by pausing ad campaigns that run for phrases that rank in position one on Google, position two through four, and positions five through 10. For example, a site that ranks number one for the phrase “hunting socks” might pause its Google AdWords ads that run for the same phrase and measure the change in organic click through from Google. When tested across multiple phrases that rank in multiple positions, an ecommerce site can determine its own relationship between paid and organic search results.

Jill Kocher
Jill Kocher
Bio  |  RSS Feed


Get the Practical Ecommerce RSS feed

Comments ( 5 )

  1. Brian April 6, 2012 Reply

    hmmm Google conducting the study… seems a little suspect to me

  2. Rob Holzer April 8, 2012 Reply

    hahaha… Brian, I was thinking the same thing. They say you can and should run the test on your own as well. The only problem there is that some marketers have accused Google of pushing your organic results down if you have a paid ad showing. Can’t prove it but anything’s possible.

  3. Nate Orshan April 9, 2012 Reply

    Hey Rob, if it were the case that Google was pushing down an organic result whenever there was an AdWords ad from the same site as the organic results, then I’d expect them not to make such a big deal out of the would-be 50% incremental PPC clicks (I.e., there wouldn’t be any way for anyone to ever see that 50% PPC clickthrough improvement).

    That said, I share Brian’s skepticism, and I await independent confirmation of this supposed phenomenon!

  4. Mark Garner April 10, 2012 Reply

    Yeh,

    Google really needs to have an independent third party do this before anyone will give it credibility. They have an obvious huge vested interest in this.

    Also, Google makes two hugely significant caveats:

    1: The results are based on averages. As Avinash says, the trouble with averages is that they give you average results.

    2: The study does not consider conversion rates.

    The only way anyone can be sure of the effects is to run their own tests.

  5. David Sewell April 15, 2012 Reply

    Running a test at the moment.
    Early results seem to show that PPC (if too heavy), can harm your organic ranking…

    http://www.seoeditors.com/intermediate-seo/seo-bounded-by-ppc-paradox

Email Newsletter Signup

Sign up to receive EcommerceNotes,
our acclaimed email newsletter.

And receive a free copy of our ebook
50 Great Ecommerce Ideas