Category Archives: Search Engine Marketing

How to Determine Your Search Engine Marketing Budget

Marketing Budget

Both small and medium sized business marketers are in the dark about their marketing budgets and in particular, about search engine marketing (SEM) budget. For Example, CyberAtlas reported that 58 percent of the internet marketers surveyed budgeted less than 1 percent of their annual marketing budgets to SEM, while 20 percent allocated 25 percent or more.

In this same study, 62 percent of business marketers reported receiving 50 to 75 percent of their visitors from search engines. In addition, we know traffic comes from search engines. Furthermore, we know this is targeted traffic because user searches are purposeful and self-directed. So it’s hard to understand why online marketers aren’t budgeted to take advantage of this vital marketing strategy.

Creating a Marketing Budget

Research shows U. S. corporations allocate 6 percent of gross revenues to their marketing budgets (on average). The rule of thumb is 4 to 10 percent of gross revenues for an effective marketing budget. The amount ranges from 1 percent for industrial B2B firms to 10 percent or more for consumer packaged goods, which can be higher when introducing new products.

Small to medium businesses will sometimes make a rough estimate of sales revenue, cost-of-goods, overhead, estimated gross profit, etc., then allocate anything left over to marketing. A better strategy is to estimate what your competition is spending and try to match that.

Using the industry average of 6 percent, your marketing budget for every $1M in gross revenues would be $60K per year, and ideally $15K (25 percent) of that will go to SEM.

Expense Justification to Management

There are a number of compelling reasons for substantiating Search Engine Marketing in your Internet marketing budget.

  • Most Web site traffic comes from search engines.
  • Search engine traffic is highly targeted.
  • The number of Internet shoppers in the USA is 245M and rising. .
  • SEM is cost effective compared to other marketing strategies.
  • Search engine text links provide branding and more conversions than banner ads.
  • The most compelling reason is that traffic comes from search engines.
  • The Georgia Tech GVU User Survey reported 85 percent of respondents found Web pages from search engines. Since then, other studies have reported 50 to 80 percent of Web site traffic comes from search engines. Both Jupiter Media Metrix and Nielsen/Net Ratings have reported shoppers use search engines to find product information online.
  • Equally compelling is the fact that search engine traffic is highly targeted. That’s because users initiate their searches for a reason – to find information, products and services.
  • The Georgia Tech GVU User Survey reported 86 percent of respondents were searching with intent to buy.

Another good reason for justifying the expense is the fact that the Web continues to grow and the number of users with Internet access is climbing. This means more traffic on Web sites, and a good portion of these will be shoppers.

  • Nielsen//NetRatings reported 498 million people have Internet access worldwide. In the U.S., 66 percent of adults have Web access. Jupiter Media Metrix reports that corporate spending is on the rise. Ecommerce Times predicted over $1 trillion will be spent online this year.

You need increased Web visibility to maintain market share, and SEM is one of the most cost-effective online marketing strategies you can buy compared to other advertising methods.

  • Marketing Sherpa case studies have reported increased revenues of 24% to 500% for companies conducting SEM campaigns. One case study compared SEM to banner ads and direct mail, reporting that SEM resulted in higher conversions at a lower cost-per-click and lower cost-per-acquisition.

SEM text links provide branding while producing the leads needed for sales conversions.

  • According to NPD Group, SEM performs better than banner ads for brand recall, as search engine text links proved more memorable than banner creative. Secondly, the number of online purchases made on sites found through search listings exceeded those made through banner ads by a large margin (55% vs. 9%).

Internet Site Visiblility

This should give you all the information you need to establish a marketing budget and to justify SEM in your marketing campaign. It’s important to make your site visible, and the best way to start is with targeted, search engine traffic.

SEM – Search Engine Marketing

Search Engine Marketing

Search engine marketing (SEM) is a form of Internet marketing that involves the promotion of websites by increasing their visibility in search engine results pages (SERPs) through optimization (both on-page and off-page) as well as through advertising (paid placements, contextual advertising, and paid inclusions). Depending on the context, SEM can be an umbrella term for various means of marketing a website including search engine optimization (SEO), which adjusts or rewrites website content to achieve a higher ranking in search engine results pages, or it may contrast with PPC, focusing on only paid components.

Method and Metrics

There are four categories of methods and metrics used to optimize websites through search engine marketing.

  1. Keyword research and analysis involves three “steps:” ensuring the site can be indexed in the search engines, finding the most relevant and popular keywords for the site and its products, and using those keywords on the site in a way that will generate and convert traffic.
  2. Website saturation and popularity, how much presence a website has on search engines, can be analyzed through the number of pages of the site that are indexed on search engines (saturation) and how many back links the site has (popularity). It requires your pages containing those keywords people are looking for and ensure that they rank high enough in search engine rankings. Most search engines include some form of link popularity in their ranking algorithms. The followings are major tools measuring various aspects of saturation and link popularity: Link Popularity, Top 10 Google Analysis, and Marketleap’s Link Popularity and Search Engine Saturation.
  3. Back end tools, including Web analytic tools and HTML validators, provide data on a website and its visitors and allow the success of a website to be measured. They range from simple traffic counters to tools that work with log files and to more sophisticated tools that are based on page tagging (putting JavaScript or an image on a page to track actions). These tools can deliver conversion-related information. There are three major tools used by EBSCO: (a) log file analyzing tool: WebTrends by NetiQ; (b) tag-based analytic programs WebSideStory’s Hitbox; (c) transaction-based tool: TeaLeaf RealiTea. Validators check the invisible parts of websites, highlighting potential problems and many usability issues ensure your website meets W3C code standards. Try to use more than one HTML validator or spider simulator because each tests, highlights, and reports on slightly different aspects of your website
  4. Whois tools reveal the owners of various websites, and can provide valuable information relating to copyright and trademark issues

Paid Inclusion

Paid inclusion involves a search engine company charging fees for the inclusion of a website in their results pages. Also known as sponsored listings, paid inclusion products are provided by most search engine companies, the most notable being Google.

The fee structure is both a filter against superfluous submissions and a revenue generator. Typically, the fee covers an annual subscription for one webpage, which will automatically be cataloged on a regular basis. However, some companies are experimenting with non-subscription based fee structures where purchased listings are displayed permanently. A per-click fee may also apply. Each search engine is different. Some sites allow only paid inclusion, although these have had little success. More frequently, many search engines, like Yahoo!,] mix paid inclusion (per-page and per-click fee) with results from web crawling. Others, like Google,, do not let webmasters pay to be in their search engine listing where advertisements are shown separately and labeled as such.

Paid inclusion proves to be particularly useful for cases where pages are dynamically generated and frequently modified.

Paid inclusion is a search engine marketing method in itself, but also a tool of search engine optimization, since experts and firms can test out different approaches to improving ranking, and see the results often within a couple of days, instead of waiting weeks or months. Knowledge gained this way can be used to optimize other web pages, without paying the search engine company.


Paid search advertising has not been without controversy, and the issue of how search engines present advertising on their search result pages has been the target of a series of studies and reports[ by Consumer Reports Web Watch. The Federal Trade Commission (FTC) also issued a letter about the importance of disclosure of paid advertising on search engines.


Search engines are constantly adjusting and developing algorithms and the shifting criteria by which web pages are ranked sequentially to combat against search engine misuse and spamming, and to supply the most relevant information to searchers. This could enhance the relationship amongst information searchers, businesses, and search engines by understanding the strategies of marketing to attract business.