Are you paying seven times too much for online business listings?

14 Nov

By Jonny Cameron

There’s an even more cost-effective way of attracting customers online. So start thinking outside the business-listing box.

Remember Yellow Pages? Online business listings are like an online version of that. A list of local businesses who’ve paid to have their company on the list. The way people buy online has changed and there’s a more cost-effective way to generate sales and target customers.

I spent 40 minutes on the phone the other day with a salesman from a well known online business listing site. To protect their identity, let’s call them hell.com (not to be confused with the actual hell.com). And let’s call the salesman Mr. Hell.

The salesman seemed like a nice fellow purporting to be “in marketing”, but sadly he didn’t check what we did prior to the cold call and seemed a bit sheepish when I told him that we were also “in marketing”.

Anyway on to the main event, he wanted to get our website “in front of people” searching for services similar to our business. It’s a blanket term isn’t it? “get in front of people”.

The size of the audience

Together, we agreed that our potential customers might use Google and enter the search term “digital marketing Northern Ireland”.

Mr. Hell was aware that I can access the Google keyword planner to determine how many monthly searches there are via Google. For that specific term there were, on average,  less than ten searches per month over the past year:

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Would you believe that on Mr. Hell’s site there were seven times that amount? That’s seven times the number of people who actively visited hell.com and then entered the term “digital marketing Northern Ireland” as opposed to using Google, the search engine that accounted for 90% of UK-based desktop searches and 92% of mobile searches in June this year. But there’s no reason to believe Mr. Hell is telling porkies, so we continued.

Mr. Hell’s Pitch

Mr. Hell asked the following questions, keen to persuade me that a listing on Hell.com was better than investing in paid search advertising via Google:

  • Have you used paid search marketing before (yes I have)
  • How much did you spend (I gave him the modest sum of £200 for this campaign)
  • How many enquiries did this give you (It gave us 10 for this campaign, that’s a cost per conversion / enquiry of £20 and if Mr. Hell could get me more conversions for less money then of course I’d be interested)

I could hear the cogs in Mr. Hell’s brain working through the phone as he presented me with the following solution:

  • £14 per month to get in front of the 70 people that had searched for this term on hell.com (our website would appear on hell.com on a listing alongside competitors)

Surely this is a better proposition than £200 for 10 enquiries?

No Mr. Hell, it isn’t and here’s why:

User intent

Mr. Hell is assuming that everyone searching for “digital marketing Northern Ireland” is looking for the products and services of an agency. They aren’t. People are looking for jobs, local competition and educational courses to name but a few. For the £14 per month there is no way of filtering the quality of the visitors.

“Getting in front of people” 

There’s always a value in getting your brand “in front of people” or as we call it, impressions (the total number of people who may have seen your advert online). And of course in order for people to click on your listing, they need to have seen it. The question is for £14 invested elsewhere, how many people can I “get in front of”

For the £14 pound per month I can get a listing in front of 70 people searching for one specific term on hell.com, however for an investment of £204.84 using Google adwords, I got in front of 8,138 people in one month (this campaign involved bidding on various terms as opposed to one). 100 people clicked on these ads on the Google search network, giving us a click through rate of 1.23%. If we apply the same click-through rate using Mr. Hell’s figures, we can make the following monthly comparison:

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Our cost per click for hell.com is going to be massive because not all of those 70 people who we are “in front of” are going to click. This means that using the click through rate of 1.23% as a guideline, the average amount you are spending per click on hell.com would be over £16 versus £2.05 on Google Adwords for this example. As a rough guide, this means that if we spent the same £14 on Google ads we would get nearly seven clicks, vs the nearly one using hell.com.

But wait, are these 70 people going to be more inclined to click?

No, they aren’t because on hell.com there is a list of competing agencies with no more detail than the company name, address, telephone number and a list of services they provide. Where’s the attention-grabbing, the unique selling point, the special offer or the call to action? They’re all non-existent, so unless you’ve paid hell.com to be top of that list, your chances of being clicked are significantly reduced at each stage of the user journey.

With a Google paid search ad you have the opportunity to be creative, meaning that even if you aren’t in the top three paid positions, you can still attract more clicks, at a lower cost, if you write a compelling ad.

The user journey

Mr. Hell was keen to point out the organic / non-paid search value on having a hell.com listing. Many local searches will bring up hell.com on the first page of Google.

However this is not comparing like-for -like as there is an extra click that is not there when using Google paid search ads:

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Not only are there two extra stages before the user enquires, your option to persuade visitors to take the desired action and contact you is much reduced by the additional clicks and lack of versatility on the listing that is hosted on the hell.com website.

Which is more likely to help visitors convert: a custom landing page on your own site versus a ubiquitous listing on a business listing site?

And the quality?

Hell.com seemed to give the most prominence to the highest bidder. The beauty about Google advertising is the quality score system that ensures that whilst you may have outbid all of your competitors on a specific term, if your ad, landing page, products and services are not as relevant to the search term as they could be, you may still not appear top of the list.

I raised this issue with Mr. Hell, how does he know we are reputable? We could be charlatans and you’d still be prepared to promote our services to visitors to your website. “No,” he said “I can tell from talking to you that you know what you’re doing.”

So maybe Mr. Hell wasn’t so bad after all.

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