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Web Search & Marketing Newsletter - February 2006

Welcome to the second edition of our monthly newsletter for 2006, covering the latest web search and marketing issues.

This month we look at the new form of sponsored search marketing - pay-per-call advertising - which is starting to attract attention and offers a new way of generating business from web search, even if you don't have a website.

We also review the significant Google ranking update that took place in October last year and the reasons why this was implemented. Finally we review another recent publication on Internet business strategy.

You can also browse through previous editions of the newsletter.

On to this month's edition...

Pay-per-call advertising

Pay-per-call advertising is gradually gaining awareness and becoming the new option for search engine marketing campaigns. First developed in the UK market by Miva (formerly Espotting), pay-per-call is also being tested by Google AdWords and Yahoo! in the US and therefore is expected to become a standard offering soon. So what is it and how could it help your business?

Pay-per call (or click-to-call) advertising is similar to pay-per-click, in that sponsored pay-per-call adverts will appear alongside natural search listings. However, instead of the advert providing a direct hyperlink to your website, a call is initiated, using one of several methods - either through a form within the advert for people to complete, requesting a call-back at a specified time; or the advert will include a freephone number, controlled by the provider, which will forward the call to your business line, and in the process collect analytics data.

At the moment pay-per-call is only receiving limited usage as some companies test the service, but as awareness grows, more companies will sign up to use this form of advertising. It certainly won't be ideal for everyone and is likely to benefit those companies that depend on telephone contact with potential customers, to provide a service or to initiate a sales conversation. It will therefore favour large companies with an existing call centre capability, or small companies providing a local service and who, for example, may use Yellow Pages (or Yell) at the moment.

Pay-per-call also extends search engine marketing to companies that don't have a website, as all traffic is handled through the advertising media and offline via the phone. This makes the Internet market accessible to the estimated 85% of the UK's 3.4 million SMEs who have no existing web presence, either from a lack of resources, know-how to develop a website, or perceived need. Now these companies can test the market for their business.

To give a idea of the costs involved, Miva charges calls at a flat rate to UK advertisers, irrespective of length, with page position working on the same bid structure as pay-per-click. The minimum bid is 2 and the actual bid price is the total cost of the call. The current set-up costs are 10 to get an 0800 number for 1 year and a pay-as-you-go account, with 50 being the minimum opening balance.

It is hoped that pay-per-call will improve on the conversion rates of other forms of online advertising, which are typically thought to achieve around a tenth of rates seen by business done over the phone. Conversion rates of incoming calls generated by advertising in traditional paper directories is thought to be around 40% whereas pay-per-click rates are rarely over 10% even for less competitive terms. Therefore it is hoped that pay-per-call advertising can address this disparity, delivering the coverage and cost efficiency of Internet advertising with the popularity and conversation success of traditional marketing channels.

As this advertising channel develops, the only way to find out if pay-per-call is right for your business and generates the quality of leads to justify the expense is to test a campaign. You'll need to consider the requirements for handling calls and converting leads, but you only pay for the calls received and therefore the ability to convert these leads to new business will be entirely down to the call handler and the business proposition.

If you'd like to know more about using pay-per-call advertising now, or to plan for this in the future, please contact us for more details.

A review of the Google 'Jagger' update

October 2005 saw the latest of Google's occasional algorithm updates that created some significant changes to their SERPs (Search Engine Results Pages) and set off much discussion and debate about the causes and effects. The update was nicknamed 'Jagger' and now that the dust has settled again, what were the main changes implemented by this update?

Over the last few years, Google has moved away from the regular updates to the search listings every 4-6 weeks (termed the 'Google Dance') and has preferred to implement continual and ongoing updates between its different data files that gradually lead to changes within the ranking results. However, there is occasionally a big update that affects lots of sites and leads to cries of foul and a perceived worsening of results.

The previous seismic change was the 'Florida' update in November 2003 and, more recently. 'Jagger' created a significant change during October last year. Cynics have noted that both of these changes occurred in the run-up to Christmas and consequently affected a lot of sites hoping for good sales from their hard fought ranking positions and who now only had the sponsored AdWords to fall back on, thus boosting Google's revenues.

There may be some truth in this, but Google is ultimately intent on providing the best results that it can and to maintain its market leading position against the likes of Yahoo! and MSN Search. These major algorithm shifts tend to be a response to perceived manipulations of the search results and spam tactics going on within the results. Google doesn't review and penalise spam sites individually, but it does pick up trends and common practices and then react to stop their overriding influence.

There has been much debate and a certain amount of speculation about what Google did this time. The words of Matt Cutts - a Google employee - are often analysed through his blog plus recent patent applications by Google have also been considered. Many of the SEO discussion forums are full of comment, either based on testing or hearsay, but of course Google continues to keep its algorithms secret.

The main reasons for the Jagger update appear to be Google's attempts to remove the increasing amount of link spam and automatically generated websites providing content 'scraped' from other sources. In addition the massive increase in blogs has to be accounted for, as does Google's continual growth in data collection and new sources of information from all the products it's been launching over the past year.

As Google's success has relied so much on the importance of links between sites and link 'relevancy', then Google has tried to redress the balance from the many tricks being employed to take advantage of this system. Google may also be using the vast amount of information collected historically to identify trends and sites included in link spam structures, so that many of these were affected by the recent update.

Fortunately, very few of our clients suffered from the Jagger update and many gained higher positions. This probably reflects our avoidance of link spam sites and our more dedicated approach to building quality links to sites, which can be a slow and painstaking task, but one that is built on a long-term ranking investment.

If you'd like to know more about the latest Google changes and the impact on your site, or if you'd like to know more about a link building strategy fr your site, please contact us now for more details.

Overture UK renames to Yahoo! Search Marketing

Overture UK has just announced that they will be following the lead of their US parent and renaming themselves as Yahoo! Search Marketing at the end of February, along with all of the other European Overture sites. This change has been expected for some time and follows the acquisition of Overture in 2003 by Yahoo! who wanted to own part of the pay-per-click advertising market.

This change will not impact advertisers using the service, which will remain much the same as it tries to compete against Google AdWords and the new MSN PPC service (which is expected to launch later this year). It does, however, mark the end of the Overture brand, which was the pioneer of the PPC advertising model in the late 1990's, when it was first called GoTo.

Book review: How Come You Don't Have an E-Business Strategy? by Matt Haig

This month we review a book re-issued and updated in 2005 by Matt Haig. It offers a quick read and a good overview of many of the issues surrounding setting up and running a business online.

Read the full review.

We hope you've found this month's newsletter informative. Please contact us if you need any more details on the items covered, or our advice on any aspect of your website's performance. Also, if there are any issues you would like to see in future editions of this newsletter, please submit your suggestions.