- Many brands needlessly overspend on customer acquisition which reduces their online marketing ROI.
- The business benefits of organic search are significant when compared to paid media.
- In fact, organic search is the single most impactful marketing channel, with an ROI between 5x and 12.2x.
Are you calculating the value of your marketing channels incorrectly? What if your customer acquisition costs (CAC) are wastefully high? What if you are missing out on revenue simply due to outdated thinking and marketing practices?
Fortune 500 brands have historically focused their marketing budgets on advertising. Even if teams have included organic search in the marketing mix, it is often drastically underweighted. Unbeknownst to executives at these brands, this has an outsized negative impact on the bottom line and market share.
With the impending death of third-party cookies and ever-increasing privacy regulations (the upcoming Privacy Sandbox initiative, etc.), the online advertising industry is in a time of alarming change.
The opportunity cost for businesses is in the billions of dollars across industry verticals.
On top of that, ad clickthrough and conversion rates continue to decline, translating into lower ROI and higher opportunity cost for marketers.
As PDCA Social President Neal Schaffer says, “Old habits die hard, and many companies… continue to invest in similar activities that might have performed in the past but might not be as successful in the future.”
With this in mind, Terakeet researched the benefits of organic search compared to other marketing channels. What we found might surprise many marketing executives.
In our study, we found that whether they were B2B, B2C, or eCommerce businesses, many brands with a strong offline presence are consistently blindsided in Google as they undervalue the organic channel. The opportunity cost for businesses is in the billions of dollars annually across an array of industry verticals.
It’s with this backdrop that Terakeet has released a new white paper:
The Compounding Value of Organic Search—How brands are missing out on 12.2x ROI by underestimating the impact of organic search. — Download the paper here.
The white paper highlights the upside-down approach that many brands take to online marketing.
The Value of Organic Search vs. Paid Search
Organic search delivers customers for 87.4% less than paid searchTerakeet
Organic search delivers 5.3x ROI compared to only 2x ROI from paid searchTerakeet
Terakeet has recently seen as high as 12.2x ROI for our organic search customersTerakeet
According to a number of recent studies, the majority of individuals searching in Google click on the organic listings instead of an ad — 93%, in fact. Organic search represents a larger total addressable market. This translates into a greater opportunity for your brand to capture online market share.
In addition, paid search is used primarily at the bottom of the purchase funnel, meaning that it ignores a significant portion of the customer journey. The problem is exacerbated when prospective customers engage earlier on with better-positioned competitor brands. This, in turn, translates into deeper audience insights, and ultimately increased business, for brands that are able to engage with their audience throughout the entire journey.
On top of all of this, organic search delivers customers at a lower acquisition cost than paid search. Terakeet research has revealed that it’s actually 87.4% lower. According to Google, organic search offers double the ROI of paid search, with SEO delivering an average 5.3x ROI compared to 2x ROI from paid search. In our own portfolio of clients, we’ve recently seen as high as 12.2x ROI for our organic search customers.
Searchers trust Google and most understand that ads are paid for, whereas organic results are earned.
Imagine the tens of millions of dollars in incremental profit that could be achieved with even a minor budget allocation shift from paid search to the organic channel. The bottom line is, an investment in organic search optimization is an investment in stronger, sustainable marketing results.
The Value of Organic Search vs. Paid Media Overall
Beyond paid search, organic search is more efficient than paid media overall as well.
Many companies allocate an exponentially larger percentage of their marketing budget to advertising over organic search. However, these brands are largely unaware of all the waste inherently included in paid media, like fraudulent or accidental clicks, market obfuscation, and lack of long-term value.
“Quite simply, users have grown to trust Google’s organic results as endorsements or ‘recommended’ answers,” says Zyppy Co-Founder Cyrus Shepard.
“Sadly, the same high level of user trust is not currently found in any search engine’s paid results.”
Users trust Google’s organic results as endorsements or recommended answers.
In comparison, organic search has no click costs or wasted ad spend. Your organic search marketing budget captures real clicks because it connects with consumers more effectively, guides them through their buying journey with helpful content, and accrues value over time, leading to larger returns.
In addition, studies show that there’s no net loss in revenue when a digital ad budget is cut and reinvested elsewhere. How can this be? This is sometimes due to the fact that many marketers purchase ads to target consumers who would have already selected the brand. Other times it’s due to fraud. Or, it’s because interruption marketing doesn’t align with the customer journey.
With organic search, you engage with your audience only when they have specific questions that you can answer or when they are seeking your types of solutions. You connect with them at precisely the time that they are most responsive to your message.
When someone queries a search engine they have a specific intent at that moment, so they’re in the perfect mindset to be receptive to messages that match well with their intent.
Brands need to focus on building ongoing relationships with their customers and prospects. That happens by breaking through and delivering ongoing, positive content experiences.
The Organic Search Advantage
Most companies underspend on organic search while drastically overspending on paid ads, which results in a disappointing ROI. Many long standing businesses stick to how it’s always been done. As a result, they get blindsided online.
“Marketers often prefer comfortable lies to uncomfortable truths, which is why we continue to see PPC channels dominate digital marketing budgets, despite the channel’s inferiority to SEO,” says Barry Adams, founder of Polemic Digital.
Credo Founder & CEO John Doherty agrees: “I hope that companies will put more into SEO… but I do think that the vast majority of marketing budgets will continue to go to advertising and things… more akin to what offline and traditional marketers have done”.
It doesn’t have to be this way.
Long-term loyalty and growth happens when you couple your paid efforts with a strong organic strategy that focuses on providing value upfront.
Organic search is the single most impactful channel for digital marketing. Whether compared to paid search ads, display ads, or other forms of digital advertising, organic search delivers greater and more varied benefits to the brand.
Read our new white paper and see how organic search enables you to cost-effectively acquire more customers, increase revenue, and capture market share.