The Risk and Return of Social Media Marketing
Written on 4/08/2010 06:40:00 PM by Martha Ballesteros
I initially intended this post to be finance-related. I'm currently taking Financial Management classes under my MBA program. At the beginning of this term, our professor challenged us to describe financial management in the way that we understand it and not just a sentence or two picked up verbatim from a book. At the end of the class, I realized that it's just a matter cost-benefit analysis or rather gauging risk and returns. With most of the people taking MBA from the Ateneo coming from the financial sector, particularly bankers, accountants, and financial analyysts, I realized that I haven't met anyone that can relate and knows how I do what I do. Knowing this, I have to make my own analysis, come up with my own metrics, and relate it to social media marketing.
Obtaining high search engine ranking is definitely one of the most cost-effective methods of online marketing however, there’s more to it than just marketing and advertising. Businesses get many benefits from increased visibility and higher search engine ranking, some more obvious than others.
Cost-effective Customer Acquisition
Businesses and individuals need not to pay search engines for their websites to be indexed. This is significantly important for businesses and search engine optimization specialists who are working on optimizing and marketing a website to have higher search engine ranking. Most of the time, high volume and low intent phrases which can be expensive in paid-search, can also be useful for directing visitors on the long tail of search. Quite a number of businesses bid on key phrases or long tail keywords through paid-search, giving opportunity to those who use a different high search engine ranking strategy and technique.
Paid-search, or pay-per-click (PPC), as other’s call it, is like a modern variation of the practice of paying finder's-fees for the introduction of new clients to a business. The payment is based on a certain value for each new visitor or a commission for each sale or a commission for each lead. Though PPC is one of the SEM techniques advertisers and businesses invest in, for it generates site traffic, it may not always lead to high search engine positioning.
Fixed Costs
The cost of having a relatively high ranking website is relatively fixed, independent of click volume. Effectively, the cost per click from high page rank websites decline through time after initial optimization costs and lower ongoing optimization costs. On the other hand, paid-search, or pay-per-click campaigns are essentially a variable cost.
Brand Visibility
Research studies suggests that 62% of internet users click on the first page of search results. With this expected amount of traffic from internet users all over the world, what business wouldn't want their website to have a higher search engine ranking? Businesses and individuals, with the help of SEO professionals and specialists, consider the various factors to set the cost and time requirement to optimize their website to improve site visibility and gain higher search engine ranking. It can be noted that about 80% of an average site’s traffic comes from a organic search engine listings. A strong presence on organic listings is seen as complementary to Paid Search - or even an alternative in earning high search engine rankings.
The increased site traffic as well as improved brand visibility of websites not only help the business itself but also its prospects and clients because of its value-added accessibility and popularity.
Posted in
brand visibility,
cost-effective online marketing,
improving search engine ranking,
pay per click costs,
SEO professionals,
social media marketing
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