Yesterday Zachary Rogers of ClickZ.com had an interesting article about retailers Q4 search engine spend increasing (by approximately 17 per cent). That’s great news for e-commerce as a whole, but despite the spend increase, Rogers indcated subsequent click-through rates didn’t grow with the spend. Within the report, Justin Merickel, VP of Marketing and New Product Development for Efficient Frontier, pointed to savvy web buyers and comparison shopping as primary reasons for the click-through drop.

Wait a second.

Retailers are spending more on keywords, yet the predicted ROI is coming back flat? (or flatter than usual). Many of my marketing peers tell me one of the biggest reasons online marketers dive so deep into SEM investments is because of the predictable return it provides. And now the returns aren’t panning out?

Backing up a bit, it should be noted the report also indicated reduced keyword buying competition (generally speaking) than in recent years. Although the increased search spend didn’t translate into higher click costs for marketers. Essentially, online marketers and retailers are getting more bang for their buck, sort of. Based on this information, I’m assuming reduced click rates means a drop in overall paid keyword conversions (as far as these retailers search efforts go). I’m also assuming the reason for lower keyword competition is a result of bigger retailers spending more and the smaller retailers spending less.

Merickel was quoted saying comparison shopping is having a huge impact on flat click-through rates. I buy that as a partial reason, but not the only reason. Perhaps it’s also a case of ineffective marketing? With more keywords being bought and the pressure to meet the needs of comparison shoppers, I see a huge value in differentiated web experiences, targeted messaging and lasting impressions (ie. web personalization and similar tools). Merickel also hinted at shoppers having longer buying/conversion cycles, which makes sense as well.

Keeping this in mind, you’d think retailers serious about their search investments would key into visitor’s surfing habits and tailor messaging/web experiences around repeat visitors and multi-visit sales cycles (especially for higher priced merchandise/sales). There are ways to reduce and streamline the multi-visit sales cycle. If things like comparison shopping are having the effect Merickel is talking about, upping keyword budgets won’t fully solve the problem. You’d think retailers would be interested in maximizing existing investments rather than adding to them?

But no, Effective Frontier believes search spend will continue to increase by 10-15 per cent in 2010. I hope that increase includes solutions like web personalization that help enhance existing online marketing pratices (like search). Anything else would be foolish, right?

It’s with great excitement that I announce Chris Corman, our President & CEO, will be appearing live on Online Marketing with RSS Ray Wednesday June 10th at 6pm EST.  This will be Chris’ first radio interview since coming on board in April earlier this year.

There are four basic points Chris plans to discuss

Maximizing existing traffic’s conversions
Emphasis and focus is always placed on driving traffic to websites.  Conversion rates average anywhere from 1-5% depending on industry and variables, but little attention is ever placed on reinvesting in the traffic that’s already visiting your site.  The reality is, you’ve put time, money and effort into your existing traffic base and only a low percentage of them are converting.  And that’s where Sitebrand enters the equation, helping maximize your traffic investments.

Testing messaging with your audience
Chris’ background in web analytics and measurement becomes very apparent when talking about testing and rightfully so.  Testing is a big component to Sitebrand personalization and subsequent success.  Identifying the need for personalization is one thing, but evaluating messages, understanding what works and what doesn’t is highly critical towards ongoing success.  Chris has some great ideas about testing – this will be a great piece for listeners to hear.

Personalization’s universal appeal
The e-Commerce world offers an incredible number of solutions that work towards improvements, efficiencies and increased revenue.  But unlike personalization, many of these solutions appeal to certain audiences and have limited uses.  The beauty of personalization is its universal use – personalized messages and content appeals to any and every visitor.  It has a tremendous impact on revenue and bottom line and as well on customer experience.

Bringing marketing back to marketers
As the internet continues to grow, so does it’s sophistication and technical requirements.  Marketer’s still have great ideas and ways to improve, but these plans are usually met with technical concerns and questions like “Can we do that?” and “Do we have the resources for this?”  Sitebrand’s intuitive interface makes even the most complicated segmentation rule easy to execute in minutes.  This might be one of Chris’ favorite aspect’s of Sitebrand’s Segment&Serve.

Again – don’t forget to lookout for Chris’ Sitebrand radio debut next Wednesday at 6pm EST.  Click here for more information about the show (note: click the upper left hand image for the live radio feed).

Let us know if you want to add anything to Chris’ discussion list – see you then!