Does the 70/30 SEO/PPC split still apply

by Peter Young on December 8, 2010 · 8 comments

There used to be a great image used by many of the presenters on the SEO circuit and beyond which suggested a ratio of between 80/20 and 70/30 clicked on organic search results over that of paid search results.

Much of this goes back to circa 2004 and before, and much of this appears to suggest a significantly higher proportion of google browsers utilising the paid search. However one has to remember, Google has changed ALOT in that time….

The days when the above assumptions/research was based was a very different animal. We have to bear in mind the significant changes that have taken place and the increasing maturity of the Google user in the modern day online environment compared against that of six years ago. This is something however I have continually seen used over the years, without any consideration for whether or not this still applies – most recently in an quote from John McGrath (head of Search for Chapter Eight in an article on the Marketer which also included Richard Gregory from Latitude and Teddy Cowell from Guava.

I would however suggest there are a number of reasons why the 70/30 search landscape may now be significantly different for a number of reasons:

The blurring of the lines

Lets compare the Google search page above, with that of the modern day search page (without taking into account any universal search results at this stage) – and we are presented with a very different landscape to that experienced in 2004, in particular:

  • The Google layout is now three column. The net effect is a much busier landscape for users which offers secondary opportunities for paid Google targeting
  • Paid Search results are now much much closer to the organic search results. The significant space between the two results is now minimal in comparison
  • The prominent segmentation in terms of background colour between paid and organic search results is now no more. Side paid search results have the same background colour as the organic results and the top paid search results are only slightly different
  • The text used to identify the paid search ads is now significantly smaller. Now just says ‘ads’. Recent research suggests the wording here can have a significant difference on paid search clickthrough rates – by as much as 33% according to a recent Harvard Study.
  • Google have recently started testing paid search results at the bottom of the page. This could further encourage those users not finding results within the top paid or first paid organic results to click on a higher proportion of paid search ads.


Paid search expands into previously organic only areas

In the last couple of weeks we have seen paid search inventory move into traditional organic territory such as image search results for example. Many of these ads occupy prominent areas of the results pages, inclusive of images within the ads themselves,something that one would suggest would have a significant impact on clickthrough when compared against that of ads where no images had been utilised.

If we go back to the days where the original 70/30 rule was started, we have a very different landscape confined solely to the traditional search engine results. Whilst this is likely only to affect small volumes of potential search traffic, this is further evidence that Google in my opinion is trying and probably succeeding in changing searcher behaviour in favour of paid search inventory.

Organic activity impacting heavily on paid search inventory

One thing 2010 will be remembered for is the continuing evolution of paid search ads, something that appeared to have been left behind in comparison to the ever evolving organic search inventory. In particular we have seen some major changes with the following:

  • Google product results showing in paid search ads
  • Google review ratings showing in paid search ads
  • Maps showing in paid search ads

One would suggest there is still signficant scope for more expansive ‘integrated’ search frameworks particularly in terms of

  • Real Estate
  • Travel
  • Social Media
  • Local

Better PPC campaigns and targeting

One has to suggest that paid search has evolved significantly over the last 5 or so years in terms of not just our understanding of how to run effective paid search campaigns but also in terms of the search engine management (both in terms of systems and MI).

Further to this, paid search managers continue with more and more organisations not utilising search (in particular) paid search the amount of available inventory is far higher again that we experienced back in the early days of search. As such this increased competition and available inventory means that more choice is thus available to potential customers. One would suggest that the availability of 10 paid search ads and 10 organic search ads is much more likely to allow potential consumers to choose from.

Reduced natural search results

Recently we have seen increasing reports of reduced organic search results being presented to searches, some seeing as low as 4 organic search results. This obviously swings the balance of favour heavily into the paid search inventories favour over its organic counterparts.

Many have suggested these may be very limited tests, so this is likely to only affect a limited number of potential searches however Google are continually updating their search results – many of these in favour apparently of their paid search inventory.

To conclude

When the initial click rations were devised the world was a very different beast.I can’t help thinking that the above ratios is due for a significant review,something I would have loved to have done as part of this post – however due to current circumstances was unfortunately not possible to do (physical data being the biggest issue here). However Google appear to be highly focussed on revenue generation, even more so than probably in subsequent years, and as such the balance of power has to have shifted during this period. With many previous examples we have highlighted, many of the tweaks made would appear to be about encouraging users to click on paid search ads. At the end of the day, we should face it at the end of the day Google is there to make money, why the hell should they not maximise their opportunities – organic search doesn’t make them any money

I would also suggest much of the data I have seen over the duration of my career would suggest to me that the ratios between organic and paid were nowhere near the 70/30 splits we often use in such discussions. My gut feel is that this is certainly lower than the 80/20 ratio I have heard mentioned during the writing of this post – and probably lower than the 70/30 we have used over the course of the last six or so years.

What do you think?

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{ 7 comments… read them below or add one }

rishil December 8, 2010 at 8:59 am

I never really bought into the 70/30 split, partially because I have worked on massive PPC accounts, and the whole variation depends on the keyword and user intent. I have seen Brand accounts which had a 50% CTR, which were used as navigational queries, while I have seen some generics, with only a 15% CTR, despite holding the top spots, and others with 60% CTR (with which I mean multiple ads, holding position 1+2 for the same KW)

However, as you rightly point out, the ladnscape is so wild, that any research would have to be superbly robust, keeing personalised search in mind, and yet I would still find myself doubting the veracity of those findings…

Xavier Izaguirre December 8, 2010 at 9:17 am

What do I think? I think we need to put the theory into practice and review that ratio, I am dying of curiosity!!

Great post, great points
Cheers

Matt December 8, 2010 at 10:43 am

Interesting post – Although Google doesn’t generate revenue directly from their organic listings, they surely have a massive indirect revenue generation impact. One of the reasons Google is in the position its in (and the fact they have the opportunity to generate income from PPC) is becasue of the quality of their organic search results, which is a result of their algorithm. If the results pages become dominated by PPC will this provide the same quality for the user and if not will they continue to come back? Wonder if at some point they will totally merge and become a hybrid, where the organic algorithm is still the main ranking factor but you can pay to boost you listing – link profile x money = overall ranking.

Peter Young December 8, 2010 at 10:57 am

Completely with you as regards buy in to the theory above – however i have seen it referred to again and again both in conference talks and whitepapers.

Like you say, my experience with large PPC accounts would suggest otherwise as well – even without any of the factors above, however its always interesting to seeother peoples feedback

Sam Crocker December 8, 2010 at 5:26 pm

Hey All,

First off great post Pete. Enjoyed it and was just having a chat about this today with some of our PPC guys (well bidding on brand terms which led us on to the “70/30″ split).

Specifically to your point Matt I think you do raise an interesting point about the value of the results and Google being somewhat constrained by that. It would seem that if they weren’t returning results that were as good/useful that they could lose some of the appeal/market share.

I personally hope they don’t go by way of merging the two. As Pete talks about the waters are already becoming quite muddy and I don’t like the fact that they are phasing out some of the differences (lighter background, etc). I also don’t like the fact that a hybrid would truly reward money spent rather than quality of content (rather than tacitly as the current system tends to).

It would make sense for Google to do that in some respects but definitely don’t think it would be good for providing the best quality results. I also suspect they would have to change their own guidelines a fair bit if they went that way (manipulating the link graph, paying for prominence, etc.).

Cool thoughts though and some great discussion here. Thanks guys!

rishil December 8, 2010 at 5:27 pm

@Matt – Yahoo used to do exactly that with their positiontech solution.

Ron December 12, 2010 at 11:10 pm

I totally agree about the last few years changes in organic ads positioning & ppc ads on the serp’s.
Shame though that google doesn’t publish some new click percentage statistics.

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