Organic Vs Paid: Why Pay for Ads on Search when I’m Already Listed for Free?

One of the most provoking questions that can be asked of a paid search manager is “Why should I pay for a search ad when I’m already being shown at or near the top of the organic listings?”

While marketing companies may want agencies and marketers to justify thebenefits of paid search advertising when there is a free service available, those managing paid search accounts may not always have a good answer.  Search is now broken out into two different types:  organic vs. paid.  Paid search listings are shown at the top of the results page and highlighted.  Ads are shown in these listings using a bidded auction.  Organic search listings are those that are determined by Google’s relevancy algorithm.  The organic listings are free.

Google has an investment, too, to keep up paid search advertising, so they have investigated this question.  The hypothesis is that if an advertiser only relies on organic search listings, they will be missing out on additional clicks from the lack of paid search listings.  In other words, does an organic listing by itself compensate for the loss in paid search clicks?

While advertisers and agencies may be willing to succumb to such an experiment of pausing and un-pausing paid search campaigns, Google has developed a system wherein they can pinpoint advertisers who have dramatically changed their ad spend on Google’s network.  This change-point, once determined real, is then passed through a statistical analysis that investigates the loss in clicks from only serving organic listings.

The results are very encouraging for those agencies and marketers managing paid search campaigns (as well as Google’s business!).  After identifying and analyzing a few hundred advertisers in 4 countries and many industry verticals, the study found that, on average, 89% of paid clicks would not be replaced by only organic listings.  Furthermore, these benefits of paid search have been confirmed even when the organic listings are in the top positions:

Organic Rank Percentage of Paid Clicks Lost
1 50%
2 to 4 82%
5 to N 96%

When it comes to organic vs. paid, it really does pay to advertise on Google’s paid listings. Find out more about how Booyah Advertising’s paid search management services can benefit your business.