According to a new study by Engine Ready, based on traffic to 26 e-retail sites in a 12-month period that ended June 30, visitors who arrive at a retailer's site from paid search ads are 50% more likely to buy than those who come from clicking on a natural search link. The conversion rate from paid search is 2.03% versus 1.26% from organic search, according to the study as reported by Internet Retailer.
Pay per click (PPC) is an Internet advertising model, used on websites, in which advertisers pay their host only when their ad is clicked. With search engines (SEO), advertisers typically bid on keyword phrases relevant to their target market.
The current study is a follow up of a completed two year study in 2008 to identify the magnitude of any visitor behavioral trends based on traffic source in a way that could help marketers adjust their strategies to maximize value. Although there can be an almost endless number of individual traffic sources, notes the study, this study, identified and measured 4 primary traffic source categories that encapsulate all source origins:
- Organic listings
- Paid listings
- Direct access and bookmarks
- Other referrer
Most likely to buy are consumers who navigate directly to a retailer's site by typing in a URL or clicking on a bookmark, as their conversion rate registered at 7.38%. Consumers who came to an e-commerce site from another site or an e-mail converted at 6.58%, the study shows. The overall conversion rate was 3.6%. The study found that:
- Paid search visitors bought the most, with an average order value of $117.06 versus $109.27 for those coming from other sites, $106.64 for visitors from organic search and $95.29 from direct referrals, such as from a bookmark or direct entry of a URL
- Average order value for all retailers in the study was $104.21, down 31.7% from a previous Engine Ready study that analyzed data from a two-year period that ended December 2007. Retailers said average order values from all channels have declined in the past 12 to 18 months
- The average time on a site per visit increased 5.8% from the previous study to 4 minutes, 33 seconds. Consumers who navigated directly to a site spent 5 minutes, 8 seconds. The study found consumers who spent more time on a site were more likely to buy, but that their average order value was not higher than that of other buyers
- Site visitors on average viewed 5.2 pages per visit, up 15.6% from the previous study. Those who came directly or from other sites or e-mail viewed the most pages, 6.2 on average
- Average number of seconds on a page dropped 9% from the earlier study to 53 seconds, which could be a sign marketers are doing a better job of presenting information on their pages in a more easily readable format, the study says. Paid search visitors spent the most time on a page, 66 seconds on average.
- 43.9% of all visitors left after viewing just one page, down slightly from 44.5% in the earlier study. Organic search produced the highest bounce rate, 48.5%, and direct access the lowest, 39.2%
- Direct access produced the largest share of site visits (40%), followed by other referring sites and e-mail (27.9%), paid search (19.8%) and organic search (12.3%)
This study is based on an analysis of 20.8 million visits and 108 million page views to 26 e-commerce sites from July 1, 2008, through June 30, 2009. 21 of the 27 companies in the latest study also provided data for the earlier Engine Ready study.