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April 14, 2009

AdGooroo releases Q109 Search Advertiser Report

Search Engine Advertiser Update – Q109b
April 13, 2009

Download PDF (6 pages)

Although difficult to see from the outside, the first quarter typically brings with it major budget shifts in the search marketing world. As retailers back off their massive fourth quarter spends, the travel industry steps in to take their place. Things are no different this year, other than the surprising additions of Bank of America and several used car resellers to the top tier of search advertisers (see "Top 25 US Advertisers by Search Engine" located at the end of this report).

The important question, however, is will these shifts in budget significantly alter Google’s search revenues from analysts’ expectations of about 11%? Unlike in previous quarters, there are no clear signs.

The best guide we have is ad coverage. In Q1, we saw large increases in the average number of ads shown per keyword. This figure reached a high of 5.5 in February in the US, up from its low of 3.1 in September 2008. This upward trend was even more pronounced when considering international search properties.

While ad coverage has historically been a good directional indicator of search revenues, this statistic diverged significantly from the estimated growth in active advertisers in Q109. AdGooroo estimated a 1.3 percent drop in first-page advertisers throughout the quarter. An increase in the number of ads coinciding with a decrease in the number of advertisers suggests an artificial change in ad coverage, perhaps in response to sluggish advertising activity, quite different than the organic growth which fueled revenues in previous quarters.

The biggest surprise this quarter, however, is a possible comeback for Yahoo!, which had been losing ground to Live Search since September. AdGooroo tracked a 10 percent increase in active first-page advertisers during the first quarter, suggesting that Yahoo! may have finally hit its stride. This coincides with a four point increase in advertiser share which appears to be at Microsoft’s expense. It would not be surprising to see strong numbers coming out of Yahoo! this month.

Finally, we have included a special exhibit in this report to compare the number of ads shown per keyword for each search engine. Some interesting factoids are apparent from this chart...

Continued in full report...

Charts:
1. Monthly Change in First Page Advertisers
2. Share of Advertisers by Search Engine
3. Avg # Ads/Keyword (US & International)
4. Avg # Ads/Keyword (US only)
5. Average Ads Displayed Per Impression
6. Top 25 US Advertisers by Search Engine

Download PDF (6 pages) (free registration required)

Posted on 9:25 AM | Permalink

March 27, 2009

Geospoofing - Is local search data too good to be true?

@Toddlearsmith asks us on Twitter:

@ChiefGooroo I took a demo of your software as well when will you be able to geo target keyword campaigns instead of just a national look?

This feature has been of particular interest to us and we have been actively researching it for the past year as a possible addition to our product. In fact, we currently have this feature working in our labs but it will likely not be available until Q409.

The way geotargeted data is collected is through the use of an undocumented Google back door to “geo-spoof” the search results. This effectively tricks Google’s servers into believing that the search originates locally.

On the surface, this seems to be a great approach as it could potentially eliminate the need for hosting servers in the target markets (these servers are expensive to maintain). However, In November 2008 we conducted a large-scale study spanning over 18,000,000 impressions. The results of the study indicated that the data gathered by this approach is unreliable and does not accurately reflect the ads that search engine users actually see in these markets. This should not be surprising, as this technique relies on a which short-circuits the usual reverse-geotargeting algorithm.

Specifically, this technique results in 75% fewer premium ads which are actually shown to local visitors. The total number of ads shown per keyword falls dramatically in comparison (around 25-30% overall, largely concentrated on second and third-tier keyword phrases):

This method also returns organic search results which are wildly out of sync with what local searchers actually see in their markets:

Finally, the missing ads also result in inaccurate coverage estimates, wildly under-reporting bottom-of-page advertisers by up to 85% (!).

So while this approach appears to offer significant capabilities and cost advantages, the data is lacking and advertisers who rely on it may actually be making worse marketing decisions than had they used nothing at all.

Be wary of companies who claim to offer "local" search data as there is currently no way to accurately capture this data short of maintaining a physical presence in these markets. AdGooroo is the only company who maintains a global network of ad collection servers. This approach provides a clear and significant advantage in data quality over more common "shortcut" techniques.

Posted on 5:55 PM | Permalink

March 2, 2009

"Mastering Search Advertising" - Recorded webinar now available!

Our 2-part webinar series, "Mastering The Art Of Search Advertising With Author Richard Stokes", is now available for public viewing via the embedded links below. These webinars cover many advanced PPC topics from the book, "Mastering Search Advertising". See below for specifics.

Part 1

• The 6 Stats You Should Always Know About Your Online Paid Search Account
• 3 Common Mistakes Of Keyword Research - Make Sure You're Not Doing One Of These!
• 3 FREE Keyword Research Tools, PLUS 2 Keyword Research Tools Used By Professionals
• The Golden Hidden Metric For Increasing Your Search Traffic Significantly
• 5 Strategies That You Can Implement Right Away For An Immediate Payoff

Part 2

• 4 Rules To Dominate Positioning In The Search Results
• The Winning Keyword Formula!
• How To Get A "Great" Quality Score
• The One Word You Don't Want In Your Ad Copy

Posted on 5:11 PM | Permalink

February 23, 2009

Free Webinar: "Mastering Search Advertising - Part 2"

Please join us for the second in our 2-part webinar series, "Mastering The Art Of Search Advertising With Author Richard Stokes" presented by AdGooroo and ROIRevolution. This webinar will cover many topics from the book.

Space is limited! We recommend you register early as the first session was over-subscribed.

Register at ROI Revolution.

Part 2: Tuesday, February 24th, 2:00pm EST (1:00pm CST / 12:00pm MST / 11:00am PST)
Duration: 60 minutes

What You'll Learn in Part 2:

• 4 Rules To Dominate Positioning In The Search Results
• The Winning Keyword Formula!
• How To Get A "Great" Quality Score
• The One Word You Don't Want In Your Ad Copy

Register for Part 2 of this FREE webinar series today!

Missed Part 1? Watch it here:

Posted on 11:04 AM | Permalink

February 16, 2009

Free Webinar: "Mastering Search Advertising"

Please join us for a 2-part webinar series, "2-Part Webinar Series: Mastering The Art Of Search Advertising With Author Richard Stokes" presented by AdGooroo and ROIRevolution. This webinar will cover many topics from the book.

Space is limited! Register at ROI Revolution.

Part 1: Tuesday, February 17th, 2:00pm EST (1:00pm CST / 12:00pm MST / 11:00am PST)
Duration: 60 minutes

What You'll Learn in Part 1:
• The 6 Stats You Should Always Know About Your Online Paid Search Account

• 3 Common Mistakes Of Keyword Research - Make Sure You're Not Doing One Of These!

• 3 FREE Keyword Research Tools, PLUS 2 Keyword Research Tools Used By Professionals

• The Golden Hidden Metric For Increasing Your Search Traffic Significantly

• 5 Strategies That You Can Implement Right Away For An Immediate Payoff

Part 2: Tuesday, February 24th, 2:00pm EST (1:00pm CST / 12:00pm MST / 11:00am PST)

Duration: 60 minutes

What You'll Learn in Part 2:

• 4 Rules To Dominate Positioning In The Search Results

• The Winning Keyword Formula!

• How To Get A "Great" Quality Score

• The One Word You Don't Want In Your Ad Copy

Register for Part 2 of this FREE webinar series today!

Posted on 1:44 PM | Permalink

February 6, 2009

PPC Rockstars Roundtable LIVE from SMX West

Attending SMX West? Come meet Richard Stokes, Founder of AdGooroo, at the PPC Rockstars Roundtable brought to you by Clix Marketing and WebMasterRadio:

Posted on 10:26 AM | Permalink

January 22, 2009

Bearish Google Predictions Reveal a Misunderstanding of Search

Google's Q4 results are out and they were good. Over the past several weeks, search industry firms have revealed a number of data points which gave the astute Google observer plenty to think about.

We were among the most vocal in our predictions for strong Q4 growth (toot!):

"December’s data continues to support our thesis that Q4 will prove to be the strongest quarter on record for Google and Microsoft Live Search."

Other notable Google bulls were Ross Sandler (RBC Capital Markets) and our friends at Search Ignite, who forecasted 5.2% revenue growth for Google in Q4.

The herd ran thick with bears though. The Wall Street Journal quoted data from Efficient Frontier which predicted a particularly gruesome holiday season. TheStreet.com also presented both bullish and bearish views and included some valuable data points as well (incidentally, they mentioned our quarterly ad coverage metrics but without citation. Perhaps next time.)

In the end, the bulls got it right. Q4 did turn out to be the strongest quarter on record for both Google and Microsoft. Our confidence was based not on hope or hubris, but on data that has been available on our site for months: "How keyword length and ad position impact CTR and CPC on Google AdWords"

Using the data in the report combined with our quarterly ad coverage numbers, anyone with Excel can calculate the relative quarter-over-quarter value of a Google search. We know that ad coverage increased significantly in Q4 (from 3.7 to 4.3, calculated by averaging the monthly figures in our report). The value of that extra ad does two important things:

1. It increases the number of paid clicks
2. It lowers the average CPC of a search by 3.3% (because more ads are sold at a lower price)

Other firms have pointed to lower CPCs as a cause for alarm. But lower prices aren't a bad thing if they're offset by higher volume. If we allow past data to be our guide, this is exactly what should happen. Our simple model predicted US revenue per search to increase by 4.5%.

Of course, one also has to look at traffic figures. Comscore reported 7.2% growth in US search queries which is a strong tailwind for Google. Combined with our simple revenue per search estimates, this made a strong case for a positive Q4. Even if you bet on disadvantageous exchange rates or drops in demand for display dadvertising, the losses in those areas would have to be astronomical to overcome holiday season demand in environment teeming with desperate advertisers.

Note: We will post our Excel model here tomorrow.

Also see: Microsoft announces 7% growth in search revenues.

Posted on 3:30 PM | Permalink

January 12, 2009

AdGooroo Search Engine Update - Q408 (Final)

Search Engine Advertising Update - Q408
January 12, 2009

Download PDF (5 pages)

December’s data continues to support our thesis that Q4 will prove to be the strongest quarter on record for Google and Microsoft Live Search.

Google led in Q4 with first-page advertiser growth of 58.0%, followed by Live Search with 42.3%. Yahoo trailed with a mere 8.8%, surprisingly low given the brisk pace of online holiday sales.

Microsoft continued to close the gap in advertiser share with Yahoo. In Q3, Yahoo led by 17.6 percent (30.4% vs. 12.0%). By the end of Q4, this lead has narrowed to 3.0% (19.4% vs. 16.4%).

As we reported in our mid-quarter update, we measured large increases in ad coverage on Google - a trend which continued throughout December. Yahoo remained consistent with previous 2008 ad coverage measurements, while Microsoft ad coverage declined in Q4 (indicative of continuing focus on ad quality control and holistic search).

We expect a flattening out or even a decline of advertiser accounts into Q1. This is typical of the post-holiday quarter, but should nevertheless lead to positive Y/Y growth.

Is Microhoo! A Possibility?

Although Microsoft officially withdrew its offer for Yahoo! in May, the financial markets have been abuzz with chatter about the possibility (or unlikelihood) of a follow-up offer. Microsoft’s comments have not been particularly enlightening either way.

On November 7th, Steve Ballmer stated to the Financial Times, “It was clear that (Yahoo!) doesn't want to sell the business to us and we moved on.”

A month later, he elaborated:

"We're fully prepared to compete without any partnership with Yahoo. We don't need to act. Would it be advantageous for both of us to make a deal? Look, the fundamental basis for doing the search deal with Yahoo has to do with critical mass in the advertising marketplace. It doesn't have to do with technology, or any of these other things, it really is a market phenomenon. Together we would have more advertisers….which means we'd have more relevant ads on our page. We'd have higher monetization levels possible in front of us because there would be more people bidding on more key words. Most importantly, Google would have perhaps a real credible competitor sooner."

- Steve Ballmer, December 5, 2008

Continued in full report...

Charts available in full report:

1. Monthly Growth in Advertiser Count
2. Share of Advertisers by Search Engine
3. Avg # Ads/Keyword (US & International)
4. Avg # Ads/Keyword (US only)
5. Top 25 Advertisers by Search Engine

Download PDF (5 pages) (free registration required)

Posted on 3:00 PM | Permalink

January 7, 2009

MarketingSherpa Case Study: Email Marketing in Tough Times

In tough economic times, search marketers turn to AdGooroo more than ever. See what Marketing Sherpa said about our 2008 direct marketing initiative and the more than 1,400% ROI it generated.

Read full case study at MarketingSherpa

Posted on 10:40 AM | Permalink

December 4, 2008

AdGooroo Mid-Quarter Search Engine Update - Q408

Mid-Quarter Search Engine Update - Q408
December 4, 2008

Download PDF (4 pages)

First page advertising activity on all three search engines was up sharply during the first two months of Q4. While substantial growth is to be expected during the holiday season, the increase in active advertiser counts is surprising given the current environment of gloom and doom. This is particularly evident when you compare Q408 growth in first-page advertisers to Q407:

	Q407	Q408 (est)
Google	-0.67%	+54.9%
Yahoo!	+6.4%	+11.2%
Microsoft	+10.8%	+29.6%

While advertiser counts are higher on all three search engines, Google’s 55% increase is well beyond what can be expected from seasonality alone. The remaining increase can be attributed to increasing ad coverage, up from 2.4 in September to 4.4 in November (a change that Google management promised during their Q2 earnings call).

This is the most significant increase we’ve seen in two years. As we stated in previous reports, ad coverage is a leading indicator of advertising activity, and it appears that Google has managed to increase ad coverage to about where it was in January, 2008.

Microsoft also seems to be taking advantage of the favorable environment. We estimate that Microsoft has increased their advertiser share from 11.5% in Q3 to about 15.8% in Q4 (37% increase), dramatically narrowing the gap with Yahoo! for second place as the engine of choice for search marketers. (For comparison, Yahoo! Now stands at about 22.1% and Google at 80.3%)

It is widely accepted that the economic slowdown would find its way into search advertising, but these figures seem to be giving the lie to this belief. Far from it – it appears that Q408 may end up as the strongest quarter on record for both Google and Microsoft.

Continued in full report...

Charts available in full report:

1. Monthly Growth in Advertiser Count
2. Share of Advertisers by Search Engine
3. Avg # Ads/Keyword (US & International)
4. Avg # Ads/Keyword (US only)
5. Top 25 Advertisers by Search Engine

Download PDF (4 pages) (free registration required)

Posted on 10:11 AM | Permalink

December 3, 2008

RSS Ray interview with AdGooroo President, Richard Stokes

Richard Stokes is the president and founder of AdGooroo as well as the author of the excellent new book "Mastering Search Advertising: How the Top 3% of Search Advertisers Dominate Google Adwords". In this exclusive article he wrote for the RSS Ray blog, Rich discusses how to use competitive intelligence to research keywords, conduct search engine optimization, and even protect your trademarks.

Richard will also be interviewed by RSS Ray on December 3, 2008 at 6pm on WS Radio.

Full article and link to live interview

Posted on 4:49 PM | Permalink

October 9, 2008

AdGooroo Q308 search marketing research report now available

Search Engine Advertiser Update – Q308
October 9, 2008

Download PDF (7 pages)

We start this quarter's report off with the good news: Microsoft has come back in a big way. During Q3, we measured a 19.3% increase in active first page advertisers, the biggest quarterly increase since we began measuring advertising activity in April 2007. In just one year, Live Search has grown their active advertiser base by almost 32%, putting them in the strongest position since their inception. That they've been able to retain advertisers in the face of an uncertain economic environment is a sign of both excellent customer service as well as positive return on investment.

However, Google appears to have had a mixed quarter. We recorded a 3% increase in active advertisers, which would've been good news were it not for Sergey Brin's statement that Google has been “too aggressive in reducing coverage this past quarter [Q2] ”. While it appears that the company was taking steps to increase coverage (at least through July), ad coverage dropped to its lowest levels in August and September, suggesting that August and September may have been weak months.

We venture to speculate that May's rollout of the new AutoMatch algorithm has not made up for the attrition of small advertisers. This is further supported by the fact that Google launched a new algorithm change in mid-September, one which promises to undo some of the aggressive quality control measures which have purged advertisers (and spends) since July 2007. The same algorithm may also be aimed at reducing low-priced inventory, a move which strongly favors big-budget advertisers (see “Google bets on brand-name advertisers” below).

Finally, Yahoo appears to be staying the course while it waits for the US government to approve its ad-sharing deal with Google. We measured a 2.5% decrease in active first-page advertisers, but there were no significant changes in other metrics.

Continued in full report...

Charts:
1. Average Ads Shown vs. # of Searches
2. Monthly Growth in Advertiser Count
3. Relative Advertiser Count vs. 12 Months Ago
4. Share of Advertisers by Search Engine
4. Avg # Ads/Keyword (US & International)
5. Avg # Ads/Keyword (US only)

Download PDF (7 pages) (free registration required)

Posted on 4:01 PM | Permalink

September 24, 2008

Searching for the Next President: the Internet’s impact on McCain vs. Obama

Searching for the Next President: the Internet’s impact on McCain vs. Obama
September 25, 2008

Download PDF (41 pages)

Many digital marketers operate in highly competitive industries, but few industries come close to approaching the level of competition present in the 2008 Presidential Election. At AdGooroo, we’ve found that as the stakes get higher, so does the quality of search campaigns. So what better arena could there be for us to study in order to stretch our marketing muscles?

First, the major points: More than five times the amount of traffic is being driven each month to Obama-related sites than to websites focusing on the McCain campaign.

Based on internet chatter, one might be led to believe that most of this traffic is the result of grassroots activity. It’s not. Nearly 93% of Obama-related web traffic is going directly to the Obama site (Only 73% of McCain traffic is generated on an McCain-owned website).

And despite the fact that there are 3.5x more pro-Obama websites than pro-McCain websites, McCain is receiving 11% more traffic from grassroots websites (surprise!).

From a search marketing standpoint, both campaigns are roughly equal in the level of sophistication of their paid search programs. The McCain campaign seems to have the advantage in terms of keyword selection, but the Obama campaign seems to be more responsive at targeting topical keywords (such as “lipstick” and “Paulson”).

However, Obama’s campaign has a clear advantage in terms of natural search rankings. While McCain’s website ranks on the first page of Google search results for 67 keywords, Obama ranks of the first page for a whopping 117 keywords.

Finally, we also surveyed ads currently being run by both campaigns. Again, another surprise was waiting for us: in the month of September, Obama ran 17 negative search engine ads, while McCain ran only 3.

Continued in full report...

Charts:
1. Partisan Domains by Candidate
2. Breakout of Partisan Domains by Position
3. Monthly Traffic to Partisan Domains
4. Monthly Traffic to Partisan Domains (excluding campaign-owned websites)

Download PDF (41 pages) (free registration required)

Posted on 6:01 PM | Permalink

September 2, 2008

New ad server resolution algorithm

Effective today, AdGooroo will begin resolving ads by the display URL (located within the body of the ad) rather than the destination URL (the location where the ad leads).

This change is desirable because it will allow us to more accurately resolve those ads which are served through ad servers. An example of an ad server is dartsearch.net, which serves ads from many different advertisers through the same redirect URL.

Previously, AdGooroo maintained a lengthy list of known ad servers and automatically inferred the advertiser from the print URL for them. However, ad servers are constantly changing and this made it very difficult for us to properly identify new ones. In other words, if you were monitoring a competitor and their ads began to be served from a new ad server, they would no longer show up on your reports.

In contrast, the print URL is much more reliable as an indicator of the source of an ad.

What this means to you: You should not need to make any changes to your account(s). A very small percentage of ads are served through ad servers and the vast majority of these will resolve to the same URL as they did before. In those instances where there are differences, you may actually see an increase in competitors' coverage as we are now more accurately resolving ads to their source advertisers.

Have questions? We're happy to answer them. Just contact your AdGooroo account representative or email us.

Posted on 12:38 PM | Permalink

August 25, 2008

New changes with Yahoo! China

Please note that as of July 18th, 2008 Yahoo! China discontinued display of side ads. Only premium ads are being shown on search results pages now:

AdGooroo clients need make no changes to their existing keyword groups, this change will automatically reflect in their reports.

Posted on 10:40 AM | Permalink

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