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April 10, 2007

Retailers Count on Search Driving Sales

A new study by Internet Retailer shows retail sites will be investing more on organic SEO and paid search. Major findings include:

Search engine marketing drives over 50 percent of sales for 30.2 percent of the survey respondents. This amounts to about 80 retailers out of a total sample of 245. The 50 percent figure coincides with earlier studies.
You won’t see any reductions in paid search advertising as 82.8 percent of respondents said they would not reduce overall PPC spending this year.
57.4 percent of respondents said search engine marketing performs better, or somewhat better, than other marketing media, including email, affiliate marketing and direct mail. Only 12.7 percent said it performs worse.
While more retailers prefer PPC to SEO for driving traffic (39.2 percent), another 34.7 percent indicated a preference for SEO over PPC. A savvy 26.1 percent use both SEO and PPC equally.

Retailers believe SEO delivers better conversions (46.1 percent), while a lesser number (37.3 percent) believe PPC is better, and 16.6 percent think SEO and PPC perform equally well.

Organic SEO
Optimizing their SEO campaigns is a high priority for most retailers. One reason is the rising cost of PPC. Retailers will improve their natural rankings on Google, Yahoo and other search engines as follows:
· 80.9 percent plan to rewrite keyword descriptions on the home page and product pages to achieve higher rankings.
· 67.9 percent will include the actual phrases commonly used in search queries on product pages.
· 58.1 percent will include common product keywords in image file names and in image display captions.
· 61.8 percent plan to improve overall site navigation.
This makes sense since 70 percent of traffic is generated by organic links while the other 30 percent comes from PPC traffic.
Paid Search
Most retailers will spend more rather than less on paid search.
· 58.5 percent will spend more on paid search this year
· 32.8 percent will stick to current budgets.
· 8.7 percent will cut back.
What search engines deliver the best ROI?
· 79 percent said Google produces the best ROI.
· 13 percent prefer Yahoo.
· 4 percent like Microsoft Live Search
· 2 percent count on AOL.
Source: Internet Retailer