There is only so much space on the first page of major search engines for advertising; up to around 20 results for every search to be exact. Competition for top search rankings is driving up the cost for advertisers. Where and when will alternatives emerge to compete with the big three; Google, Yahoo and MSN?
The proportion of advertising spend being directed at online is growing rapidly and the search engines are well placed to capture the lion's share. Marketers across the world know that consumers are spending less time watching TV and reading newspapers. They also know that the returns on investment for billboard advertising and letter drops is diminishing as consumers become more desensitised to mass advertising. So where is this leading and how can we prepare for the inevitable consequences?
Retailers in the "bricks and mortar" world have known the importance of position for a long time and pay handsomely to position their stores in high traffic spots. Major retailers have the option of buying prime real estate and the law gives them title to the property so that it cannot be taken away from them. Half the top spots on the search engines are for sale to the highest bidder, so that is similar to conventional retail channels, but the natural search spots are not for sale. As pay per click advertising costs rise, competition for natural search rankings will rise too as these referrals, or clicks, are free. Who will get these spots?
The search engines do not share their algorithms for determining page ranking as this is the intellectual property that they use to compete with each other. However, we do know that there are two primary factors that determine rankings: "On Page" factors and "Off Page" factors. As web designers and SEO experts, we have some capability to optimize these factors but how much? I predict that in time, it won’t be much – let me explain.
One of the key factors that I believe will determine the rankings of websites in future, as I believe it does today, is what is called “Authority Websites”. Websites that are considered to have authority include such things as age of the domain, domain type (egg .gov or .edu domains score highly) and the number of inbound links from other high ranking websites. Finally I think increasingly those websites that attract the higher traffic volumes will score authority points. So if you take this thinking to its logical conclusion, small and medium size business will not be able to compete with major corporations on the major search engines! So what will they do?
Investors and venture capitalists have witnessed the meteoric rise of “information economy” companies in the stock markets. The change of leaders in the leading market indices has changed relatively quickly over recent decades. Names like IBM, Microsoft, Google and AOL were almost unheard of fifty years ago and now they are household names and large global organizations. So investing in companies like these has been very good for investors, despite the dot com bubble bursting. So any technology or internet savvy company that emerges promising new billboards for online advertisers has got to be a hot prospect. Especially of they can take on the incumbent majors.
So I predict that we will see new forms of internet advertising emerge that will begin to target niche segments of the market where major corporations will feature but perhaps not dominate. After all, I am not always looking for the biggest organisation to service my needs and I might appreciate a search engine that delivers me what I need. Until that time though, we are just going to have to do the best we can with what he have.
On a positive note, If you are a smaller company today and are willing to invest in placing highly in search engines, it may prove challenging for others to displace you. It remains to be seen but will the search engines reward loyalty? Who knows? Nevertheless, investing in search engines remains one of the best ways to attract new business today; and it may pay long term dividends.
Pete is a
search engine optimisation specialist who writes on the topic of
search engine marketing.
