The search engine Google is the operating system of the Internet.
That has a lot of implications for branding. Imagine knowing about 15 years ago, for example, that Windows would emerge from a clutter of competing operating systems and become the dominant force it is today. How would that have affected your branding, product development and even investment plans?
If Google truly is the operating system of the Internet, then companies must place a great deal more attention on search engine marketing than they do now. It is not only much more important to corporate branding and sales than many realize, but will become even more vital when search engines are combined with geolocation and other capabilities.
Within a decade, such capabilities will reduce the importance of street signage and even location. It will also enable, for example, prospects outside a restaurant to see reviews from previous patrons before they enter. Already, a Korean "digital media city" is experimenting with these and similar location-based capabilities.
Search engine marketing is vital because 78% of Internet usage consists of people researching products, places and services, according to Jupiter Research. By any yardstick, Google leads.
A Nielsen/Netratings survey of 60,000 homes and businesses in January indicated that 29.5% use Google; 28.9% use Yahoo!; and 27.6% use MSN. However, users spent more time with Google--28.5 minutes a month, compared to 11 minutes for Yahoo! and 8.7 minutes for MSN.
Currently, search engine marketing falls into two categories.
The first is search-engine optimization (SEO). This involves persuasive Web content based around well-researched key phrases, as well as design that incorporates good metatags (codes that describe Web page content) and avoids frames, Flash or other search engine no-nos. It also involves continuous efforts to keep up with search engine ranking criteria and competing placement efforts. A top-ranked site can easily drop to the cellar in days without ongoing effort.
Companies can do SEO by themselves or pay a third party. A common estimate for do-it-yourself SEO is 20-30 hours a week. Third-parties can cost from $1,000 to $100,000+ annually, depending on the depth of effort and amount of automation. (One high-end SEO firm promises "organic page optimization of primary landing points outside of product areas," which, I suppose, is a good thing.)
A third alternative is to use a $100 package that automates site submission, although it's been reported that some search engines treat these automated submissions like Spam.
The second category is pay-per-click (PPC) advertising programs like Google's AdWords. Companies bid on relevant search terms, and then pay that amount each time a prospect clicks on an ad, which is either atop the page or amid search listings. Paid-search revenue grew 40% last year to $1.4 billion and will top $2 billion this year, says U.S. Bancorp Piper Jaffray.
PPC advertising works because prospects today are goal-driven. Who randomly "surfs" the Internet anymore? That helps make PPC advertising cost-effective. The average is 35 cents per click, cheap compared to the $1-per-lead average for Yellow Pages advertising. Staples.com believes the return from search engine marketing "outpaces everything in print or online." No wonder banner ads are dead.
As a result, it's time to develop strong search engine marketing skills and strategies. Several trends affecting branding and the Internet will make it even more important in the near future. The first trend will be various efforts to add context to searches. Context enables searches on "The Carpenters" to turn up information on the singing group, not wood workers.
Emerging specialized search engines will add some context. Already, Google has introduced a new service called Froogle (what an inspired pun!). Froogle focuses entirely on product search, which means that searches for Patagonia will never mention South America.
Froogle represents a lot of potential--prospects arrive at your site specifically looking to buy--and it also represents a lot of hard work. Unless online retailers manually submit XML product feeds and keep them current, Froogle will purge listings from its database.
The next generation of search engines, judging from work Microsoft and others are doing, will be in task-focused business applications such as logistics and procurement. Search engine technology will not only automate the search for relevant and qualified business resources, but also provide such advanced functionality as bid management.
Eventually, search engines will bridge the existing gap between virtual Web sites and physical locations, which is hindering localized branding efforts. Already a number of companies offer geolocation services that enable Web sites to determine the physical location of individuals.
This not only enables targeted advertising, but also helps insurance, pharmaceutical, gambling and other companies comply with relevant laws. Additionally, satellite technology can pinpoint wireless location to within a few meters.
To leverage location knowledge, Web sites will have to have "geotags." Searches on "restaurants," for example, will then display sites according to their proximity to you. Other localized information can also appear, such as public transport, amenities or crime rates. "Geoencryption" may enable data to only be seen in certain locations.
This potentially could change retailing as much as malls did in the '60s. Rather than location, location, location being the key to success, it may well be the amount of data that is made available. The most eye-catching sign or store window will matter less to branding than being listed atop the right wireless databases or yellow-pages services. Imagine the ongoing search engine skill and resources that will be required.
In January 2001, a client asked infamous Merrill Lynch analyst Henry Blodget about what made the first PPC firm an interesting investment. His tart email reply: "Nothin'."
How wrong he was, because every branding effort must now incorporate continuous search engine marketing into branding efforts.