Online Stat of the Year?

Over on the Rimm-Kaufman Group blog was a report on what Forrester’s Carrie Johnson had to say at Shop.org’s Marketing Workshop.  There are quite a few interesting tidbits, but here’s the pair that blew me away:

Correlation between Google Gross US Revenues to US E-Commerce Growth: .96.

Correlation with Yahoo Display Ad Sales and US E-Commerce Growth: -.04

Now, I understand that Correlation does not imply Causation but at some level when you get directional spreads like this you have to sit up and take notice.

One explanation is this:  e-Commerce sites do not buy any Display to speak of, but we know that’s not true – don’t we

Other questions:

1.  Another conclusion would be Yahoo matters very little to e-commerce activity.  Sure, less than Google, but to this degree?  If in fact Display enhances Search performance, you would think Yahoo would have more of an effect.  Perhaps folks see Display on Yahoo and then Search on Google?   Wouldn’t that be a trip…

That scenario would really provide a whole new twist on the measurement of view-throughs.

2.  Google gross rev’s include AdSense, of course.  So we’re not really comparing PPC to Display here, though one could argue AdSense is more targeted than Display.  So what we are discussing here is the relevance of ads, not PPC versus Display.

3.  Does Yahoo Display include Travel ads triggered by selection of Location?  Auto ads triggered by selection of Model?  Etc.  Etc.  You could argue those ads are really “Search” if you look at it from a behavioral (customer) perspective.

Sure would like to find the source on this, and see what we are actually talking about here.

Other questions you would ask / data you need to make a judgment on this?  How about wild speculations on what this data means, if anything?

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5 thoughts on “Online Stat of the Year?

  1. Jim —

    Agree, incredible yes. I am following up w/ Carrie for cites. Lehman Bros, I think. She didn’t provide a handout, so notes were just Alan typing fast, hence the lower quality. More to follow. Thanks for the link. :)
    –Alan

  2. Hi Jim,

    I’m actually today on a very interesting case (kept me up until 3 AM last night).

    Here goes:

    This company operates in a geographically delimited market, with a very unique product. We know from research that the client enjoys a 96% brand awareness.

    Organic search actually drives a good third of the online sales! Paid accounts for close to nothing, and falling. When I look at the keyphrases, the top 20 grab 83%, with mention of the brand in all but one!

    Google owns that space with MSN and Yahoo barely moving dust.

    The more I look at it, the less I can call that *search*. It looks much more like *browsing* to me, as if Google was replacing the URL field of the browser.

    Google is the new browser ! (OK, I say that to create an effect).

    Actually, I am noticing that phenomenon more and more with companies that have strong brands, and whose domain name is really obvious, i.e. people could know right away from trying their name with .com. Still, the brand (and variations/associations with other keywords) often occupies almost all the territory of organic search terms. Quite interesting.

    Any thoughts?

  3. Jacques,

    I’m not sure I’m following you on this but I’ll give it a go…

    Seems to me you are saying you would expect people who know the Brand to construct some form of the URL in the address bar and hit return. But what they do instead is type Brand.com in the Google search box. So what you see is all this Organic activity that looks more like URL use than Search.

    I confess – I do this all the time. I find it easier, faster, and more reliable than typing / guessing URLs in the address bar.

    Google as a URL appliance, if you will.

    Does the above address your question? Or am I not getting it?

  4. In toher words yes. My point is, we can’t really call that behaviour *search*, as it shows in reports. Makes us wonder about how Organic and Paid should really be compared.

  5. I think you are probably right about that. This is one of the reasons why I have always thought it’s insane to buy PPC for your brand name, given the Brand site basically always ranks #1 for Organic search and given how lots of people use the search box like the address box.

    I believe Alan (above) concurs on this “PPC for brand” subject and probably has a lot more hard data than I have…if he’s still around maybe he has a link to something he has blogged before on this…

    It just seems to me there is too much intent loaded up in a Brand search like this for there to be a lot of incremental lift to PPC, along the lines of this study for the Lab Store.

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