Something we get asked a lot about as an agency is our approach to pausing paid search spend on key brand terms, especially if the brand consistently ranks organically in the top position of the SERP (search engine results page) whilst paid spend for top positions is increasingly expensive.
Why do advertisers want to pause paid brand keywords?
Many advertisers are seeing large increases in average CPCs and significantly higher costs YoY without the subsequent uplift in performance. In fact, in Merkle’s Q2 Digital Marketing Report, we estimated that average CPCs for brand keywords jumped 30% YoY for Q2. Often this is due to increased bids from competitors in a bid to secure brand prominence on the SERP.
Should I test this out on my brand keywords?
There are a few things you’ll want to consider when deciding whether a paid holdout is suitable for your brand:
Depending on your business, you’ll need to think carefully about when the best time would be to test this, as it can have a huge impact on website visitors and conversions. For example, retail clients probably don’t want to pause paid brand terms in Q4 and likewise lead generation clients might not want to pause during their quietest months.
There’s little point in going any further if you don’t have a means of monitoring and analysing the results. You need to be able to see all relevant business data e.g. visits, conversions & revenue, and if you’re only pausing certain paid keywords you’ll also want to be able to segment the results to see the impact of this on that area. Yearly and monthly data is also useful as a quick way to measure drastic drops in performance, allowing you to stop the test if necessary.
Although one of the main reasons many clients want to try a paid search holdout is due to increasing CPCs, this is also a key reason not to do this. If you’re already struggling to maintain a top brand position on the SERP, then pausing search activity might allow competitors to claim their share of voice over your brand.
4. Brand Loyalty
Different industries have varying levels of customer loyalty. For example, where product offerings and price points are similar for some retailers, brand loyalty can be low, with customers looking for the best deal on the day of purchase. Conversely, brand loyalty for automobile, technology and insurance providers can be much higher. If your brand loyalty is very low, you might be more reliant on paid search to maintain dominance on the SERP; or equally, you might consider brand loyalty to be so strong that this paid search dominance for your brand terms is less important.
Luckily, we have a few case studies where we’ve already tested the impact of pausing PPC spend on brand terms. These tests were for clients in various verticals, with their own KPIs to gauge what impact it might have for clients in different industries.
Case Study 1 – Lead Generation Client
One of our insurance clients (in the US) paused their paid brand activity to test the impact of this on SEO. They found that organic brand searches only picked up a small amount of this traffic and there was an overall decrease in CTR as well as a loss of revenue:
- An estimated 92% of the visits driven by brand paid search were NOT picked up by organic
- An estimated 74% of the applications driven by brand paid search were NOT picked up by organic
- CTR suffered – organic CTR did increase 23% MoM, however there was an overall drop in CTR of 14%
- An estimated yearly loss of $590,592 for just one of the client’s service offerings (not accounting for the yearly cost of brand term paid search)
Test results - CTR performance:
A similar client, in the UK also paused their paid brand
keywords. The test was narrowed down to ‘brand + login’ keywords to identify
returning users who were less valuable than new users. There was no significant
drop in traffic to site, or in average CPCs, but the client did notice a
decline in completed forms. This meant the test ended early and the keywords
Case Study 2 – E-commerce/Retail Client
An e-commerce client operating mainly B2B performed a paid holdout test. They paused paid search and consequently saw a 31% drop in sessions on their site and a 25% loss in revenue.
Finally, one of our B2C fashion brands tested this over a six-week period. In this case, the client hadn’t run brand keywords through paid search before, so they wanted to test the impact of this on organic search. They found that paid brand activity did cannibalise organic sales, however there was a 12% drop in transactions when the paid brand terms were paused.
Test results - Organic vs paid transactions:
So, what have we learned?
Well, it seems that more often than not, the traffic is not picked up organically and there is a significant loss of traffic to site and ultimately conversions and revenue, all suggesting the value of running paid search alongside SEO.
Whilst this might not be good news for advertisers looking to reduce spend through SEM, there are alternatives.
Across the agency our PPC and SEO teams have been working together to test out other ways to address these issues:
- The impact of Quick Answers on paid search
- Assimilation of paid and organic search results (modifying paid ad copy and extensions or changing the meta titles and descriptions).
- More extensive keyword cannibalisation analysis
(pause certain keywords based on organic position, high spend, low conversions or those with aggressive competitor bidding).
If you’re interested in developing a more integrated SEM approach, please get in touch with the team.