SEM-A²: OPTIMIZATION OF SEARCH ENGINE ADVERTISING
Search Engine Marketing Account Aggregation
Within the scope of the “Search Engine Marketing Account Aggregation” research project – briefly referred to as SEM-A² – the research team headed by Prof. Dr. Burkhardt Funk is analyzing search engine advertising targeted at companies. The researchers particularly aim to provide scientifically relevant and practical solutions for small and medium-sized enterprises in the region.
Search engines like Google, Yahoo and Bing! subdivide their search engine results pages into two parts: In the first part, they provide a list of all websites which they deem most relevant to the keyword search term, using complex search algorithms (organic results). The second part, which is clearly separated from the first one, also includes all paid search results (sponsored results). Over the past ten years, paid search engine advertising has become one of the most important online advertising channels in Germany in terms of advertising budgets. The advertising companies provide the search engine providers with a list of so-called keywords. In technical language, keywords are words that Internet users enter into the search engine to start a search request. Each keyword is accompanied by a note indicating the maximum amount the company would be willing to pay for one click on its advert regarding a specific search request in the search engine results. If several companies are interested in a keyword, the positions on a search results page to be allocated to advertisers will be sold at auction each time a search request is made.
A challenge for small and medium-sized enterprises
While for many large companies search engine advertising has become the most efficient and, at the same time, most effective channel to solicit new customers, small and medium-sized enterprises often face difficulties in planning and carrying out advertising campaigns. Even with companies having a strong advertising budget, only a small part of the keywords purchased proves to be effective. This can be measured by the number of clicks on the advertisement that takes visitors to a company’s own website (clicks), the number of contacts made by potential customers (leads), and the number of visitors completing the desired action (conversions). Even executives often focus a major part of their optimization measures and budget on these areas.
As a result, the following problems arise:
- Small numbers of cases do not allow companies, or only allow them to a limit extent, to take any empirically founded decision to optimize their campaigns.
- Costs are unnecessarily high. Due to strong competition for attractive positions in the search results among both external advertisers and corporate subsidiaries, click prices are very high.
- Efficient support of small and medium-sized enterprises with only a small budget is difficult due to high intensity of support needed.
The SEM-A² project team has been researching new approaches to these problems since October 1, 2011. It is collaborating with several regional companies.