Mass hysteria? Finally proven: social media and SEO massively undervalued

Now that TagMan has been tracking all the activity of some very big clients for a substantial period of time, we can provide some pretty definitive answers about how different campaigns appear in, and contribute to, the path to conversion.

From this data, we have proof that natural search and social media channels are vastly undervalued, while the effect of paid search is overstated…

There were many points to TagMan but one of the big ones was to enable clients to measure,at long last, the real role of individual digital channels in the complete path to conversion.

By housing all the tags from all your channels in one place, clients would be able to see actually where and how different campaigns appeared in and contributed to the path to conversion.

Then, they’d know the answers to some really important, but very difficult, questions.Here’s two of the biggest:

  1. What’s the real value of paid and natural search in delivering sales, particularly on brand terms?
  2. What sales value do social platforms like Twitter and Facebook deliver?

Now that we have been tracking this for a substantial period of time, we can provide some pretty definitive answers.

There’s no prizes for guessing we are discovering that natural search and social media are chronically under-rewarded. Or that paid search (both brand and generic) appear overly so.

But, demanding numbers-based proof of what common sense already tells us is the yang to digital’s ying of real accountability. So, here it is:

The findings below are from a real client. The client cannot, for obvious reasons, be named; the raw data on which this insight is drawn is theirs. We can tell you it is a large retailer.

The real value of natural search

In simplest terms, on this one brand, over a six-week period, natural search listings on non-brand terms delivered about 14 times more value than they are currently credited with.

We can say this because:

We measure the ‘Conversions’ of every channel, how many times any one channel or campaign is the last click. If credit/commission is based on last click then this is the number of sales with which any one channel is credited. In our example, generic SEO was the last click on 1,663 occasions and so credited with 1,663 sales.

We measure the ‘Assisted Conversions’ of every channel. That is the number of sales in which a channel appeared in the path to conversion, at whatever stage. This gives us a gauge of just how often a channel plays a part – any part – in delivering a sale. In our example, generic SEO appeared in the path to conversion of 78,117 sales.

We measure ‘Attributed Conversions’, the amount of sales in which a channel appears in a path to conversion divided by the total number of events in that path. This is the clever one. This is what happens were we to divide credit equally for any sale between all the events that appeared in the user journey, known as a flat attribution model.

While we might want to weight credit to, say, the event that was last or the event that was first, Attributed Conversions gives us a sense of the ‘influence’ of a channel since, if a channel appears a lot in paths where users are exposed to 20 events, you can say it has less value than one that appears lots in paths where there were only two or three.

So Attributed Conversions divides the credit equally between all channels in any one path to conversion to give us a sense of its true influence. In our example, generic SEO is responsible for 23,923 Attributed Conversions.

So:

  • Natural search listings on generic terms are credited with 1,663 sales, when they should, if credit was to be shared equally between all events, be credited with 23,923.
  • Generic SEO gets credited for 14 times less sales than it deserves on [a flat attribution model].

By the way, brand term natural search, on the same methodology, is under-valued by a factor of nine.

The real value of paid search

The big question surrounding paid search is often whether it’s worth spending on PPC brand terms, given you know many of those clicks would have gone to your natural listings anyway.

So, quickly, we can tell you that branded paid search is 2.5 times less valuable than currently thought.

That doesn’t answer the question about cannibalisation, you’d have to turn brand PPC off and compare your figures to understand that, but it does tell us it gets 2.5 times more credit for sales than it should if you were to reward equally all channels in the conversion path. But, interestingly, product/generic search terms don’t fair much better.

Here’s the rundown:

  • ‘Conversions’ (amount of times generic paid search is last click):16,579.
  • ‘Assisted Conversions’ (amount of sales in which generic paid search appears in the path to conversion): 31,494.
  • Attributed Conversions (amount of sales in which generic PPC features in the path, divided by the total number of events in each path): 10,345.
  • Therefore, generic paid search gets 1.6 times more credit than it should.

Why is this? The simple answer is that, because paid search is so often the last click that it gets attributed with a greater proportion of sales than channels that appear higher upstream but which are still drivers of sales.

The real value of social media

Oh the big one, what value to sales does social media really deliver? The real value of social is of course the ability to talk with your customers.

It still seems strange that we have to justify it much more than that but, to answer questions like ‘how much should I invest in social media’, hard measures, like how they contribute to sales, have to be taken into account.

In our client example, we track redirect URLs from links in platforms like Twitter and Facebook. Clicks on links in these places are tracked alongside clicks and views from all ‘traditional’ channels and that tells us that social media delivered the following (over the same six-week period):

  • ‘Conversions’ (last clicks):100.
  • ‘Assisted Conversions’ (number of successful paths to conversion in which it appeared): 2,433.
  • ‘Attributed Conversions’ (number of successful paths to conversion in which it appeared, divided by total number of events): 795.3.
  • Social media gets eight times less credit for its direct contribution to sales than it should.

As you can imagine, the teams at the client in question are aiming to do all manner of things with this information. It’s probably not as simple as just splitting marketing spend by channel according to ‘Attributed Conversions’, but it might just be…

Paul Cook is CEO of TagMan and a guest blogger at Econsultancy.

Article from: econsultancy.com

 

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