Second Tier PPC Problems

I was often asked by clients and paid search marketing beginners about this. After Google Adwords, Yahoo! Search Marketing, MSN Adcenter, Ask.com Sponsored Listings and Baidu JingJia (for Chinese traffic), what will be the next PPC search engines to try? One of the major reasons could be that paid search is becoming competitive with the top-tier PPC search engines.

Also from time to time, I have always been approached by the so-called 2nd- and 3rd- tier PPC search engines. The sales representatives often came up with the selling pitch similar to below:

  • Our search engine will increase your traffic by 200%
  • Our conversion rate is 20% higher than Google Adwords
  • Our cost-per-click across the board is 25% lower than Adwords

Since a couple of years ago, believe it or not, I have tried at least over 80 non-1st-tier PPC search engines. In my experience, most of them shared the problems below:

Reason #1: Distribution

After Google Adwords and Yahoo! Search Marketing, the distribution level of other PPC search engines fall off sharply. A good example is MSN Adcenter. Being recognized as the third paid search marketing platform, the distribution level of Adcenter is only a small fraction of Adwords or even Yahoo! Panama.

From this conclusion, the 2nd-tier search engines who have been maintaining high traffic quality are definitely not providing high traffic volume and great reach regarding search network distributions.

Reason #2: User Experience

It is the great reach of distribution that has helped the top-tier PPC search engines to collect more data about their users. With the data, they are then able to continuously improve the user experience by enhancing the reporting and all types of features in their paid search marketing platform. To mention a few enhancements by the top-tier search engines,

  • Adwords updated its Quality Score to reduce low quality ads, and has already made its Quality Score more visible to advertisers.
  • Yahoo! Panama introduced a way for advertisers to flag their important campaigns, groups and keywords and to have them all displayed in display panel.
  • MSN Adcenter was first to introduce demographics options allowing advertisers to only show ads to certain age groups and specific genders.

Obviously, this is not something I have seen with lower-tier PPC search engines.

Reason #3: Cost

Adwords was the first PPC search engine to introduce Quality Score in ranking ads, and in the Quality Score a great portion of it is the CTR. This is one of the main reasons experienced PPC advertisers have been able to save hundreds of thousands of marketing budgets on Adwords.

Only after a couple of years other top-tier search engines have followed. Adcenter, Panama and Baidu all are using a similar way to the Quality Score to rank ads. Ask.com and Adbrite are also using CTR as a factor in ranking ads.

The other search engines down the ranks have not been able to catch up with this technology and are mainly ranking ads based solely on pricing. Basically, they have offered no solution to save cost for their advertisers. This can only make them less attractive to major advertisers and less competitive to the major search engines.

Reason #4: Traffic Quality and Click Fraud Concerns

To increase traffic volume, some of the less known search engines would sign up large amount of distribution partners, without concerning too much about their traffic quality. It is a way for the 2nd- and 3rd-tier PPC search engines to survive, but at the same time they are putting their reputations at risk.

Click fraud detection is also another big concern for the lower-tier search engines, as they are often reluctant to offer technologies to detect possible click fraud. Much of the click fraud detection has to be performed by the advertisers, in which this collides with one of my previous posts on 5 ways to spot click fraud. Click fraud has become great of a concern than ever, and not long ago Inside Adwords Blog has revealed the 3 steps of click fraud detection,

  • Real-time filters
  • Offline analysis
  • Reactive investigations

Reason #5: Return On Effort

Vinny Lingham previously explained in details about Return-On-Effort (ROE) with one of his posts.

Basically, the argument on ROE is that advertisers should spend their time and efforts on expanding and tuning their existing paid search campaigns. In doing this, the ROE will be higher than spending time and effort on the non-1st-tier PPC search engines.

Comments

3 Responses to “Second Tier PPC Problems”

  1. PPC Marketing Guide » Stay away from 2nd tier engines? on May 3rd, 2007 4:01 pm

    [...] Gordon Choi wrote an interesting post about why not to advertise on 2nd tier pay per click engines. He explains a few strong reasons to stay away from them. To reinforce his point take a look at this chart. With a majority of users searching on Google, Yahoo, MSN, ASK and AOL the time you spend setting up and troubleshooting those smaller engines may have been better spent optimizing your engines that drive more qualified traffic. Also, most 2nd tier pay per click engines get their sponsored results from one of the bigger engines, so your ad will most likely already appear there. 2nd tier pay per click engines [...]

  2. Extending Your Reach - 3rd Tier Search « Syzlak’s SEM on August 16th, 2007 8:45 pm

    [...] >Our search engine will increase your traffic by 200% >Our conversion rate is 20% higher than Google Adwords >Our cost-per-click across the board is 25% lower than Adwords [...]

  3. Derek Brown. WebXsposure on June 11th, 2008 8:21 pm

    I’ve had so many occasions where I have had to explain this to a potential and/or current client. I can usually get by with just stating that with Google holding 69% and yahoo trailing at 12%, that leaves 19% for ALL THE REST of the engine so share. The effort (ROE – now I have a new acronym to throw around!) put into that would just not be cost efficient. The only other engine I have tried (because of a coupon) was looksmart, and that did not yield anything worth the effort it took to set up and monitor.
    Thanks for the ammunition!

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