• by Ross Fadner , October 5, 2004

When it comes to selecting keywords on search engines, marketers who pay more don't necessarily get the most value for their dollars, according to a report released yesterday by DoubleClick.

The report--"Search Engine Marketing Considerations," from DoubleClick search and affiliate marketing unit Performics--found that more than 60 percent of "active" keywords (that is, keywords that have resulted in at least one click in the last month) cost 20 cents or less. In contrast, keywords that cost more than $1 account for only 6 percent of those clicked on at least once a month.

Higher position doesn't necessarily mean greater click volume. The report concluded that high click-volume keywords perform equally well both above and below the top three. In fact, lower-positioned keywords drive 10 percent of total conversions. Moreover, conversion rates tend to fall as cost-per-click prices exceed 50 cents.

The report was compiled from Performics' data of over 100 marketers for the first and second quarter of 2004.

DoubleClick also concluded that search engine marketing requires a combination of human expertise, robust technology, and constant attention--three qualities that are not always readily available to the average interactive shop or in-house marketing department.

Above all, marketers "better have the technology and better have a plan of attack," said Chris Henger, Performics' senior vice president of marketing and product development. He added that most in-house marketers aren't capable of handling the process on their own, because of a lack of resources and sufficient technological sophistication.

The full white paper is available at DoubleClick's Web site (www.doubleclick.com).