The overriding priority for most of the major engines is survival, and the compromises made in the name of survival have been significant. In many cases, once proud engines have sold the very essence of their functionality in return for enough incoming revenue just to keep the doors open. Recently, further announcements from AltaVista have added to the confusion surrounding search engine marketing. Although I've looked at the topic before, I think it's time we look back at your paid placement options and what it really means to your website.

Break open the Piggy Bank

The fact is, search engine optimization is no longer a free form of advertising and the Net is no longer an even playing field for the big boys and the small independent players. If you want to be found for keywords on the big engines, you're going to have to budget for it. The question is, how much and where to spend it? In this NetProfit, we'll be looking at the crawler based engines: Goto, Google, AltaVista, Inktomi and Excite. In Part Two, we'll be looking at the directories, Yahoo, Looksmart and Open Directory. In Part Three, I'll look more at the future of the search engine industry (again) and also the whole question of search engine optimization and if it's still needed.

Bringing Out the Yard Stick

When looking a paid placement options, I'll be using just one criteria in my recommendations to you: where do you get the most bank for your buck. I'll look at the engines, the traffic they receive and the cost to tap into that traffic. With the fact that paying for search engine traffic is now inevitable, it's important to know you're getting maximum value for what you do spend.

To help you in this task, I've set out the following rating system

	Include this in your budget, it's a necessity
	If you can't afford it now, plan on trying it in the next 6 months
	Try it if you have all the major bases covered and you can do it at minimal cost
	I wouldn't bother, but it's your money
	If you liked this one, I've got some beachfront property in Saskatchewan you're going to love!

Express Submission vs. Paid Inclusion vs. Paid Placement

First of all, I should clarify a point that causes confusion when we talk about paying for search engine traffic. There are three basic models out there: Express Submissions, Paid Inclusion and Paid Placement. Here's the differences:

Express Submission: this refers to the program started by Yahoo and later adopted by LookSmart (which has recently gone to a Paid Placement model). You pay a flat fee ($199 US) to guarantee that an editor from these directories will review your site for inclusion. There is no guarantee that you will be included, but generally the chances are pretty good. The amount you pay has no impact on where you will rank in these directories.

Paid Inclusion: Here, you pay a flat yearly fee to ensure that the search engine's spider will include you on it's regular rounds. Started by Inktomi, AltaVista has also recently indicated that they're going this route. You pay per distinct URL (for example, each page of your site would be a different URL) and the rate is between $20 and $35 for the first URL, with discounts for additional ones. Again, the amount you pay has no impact on how you'll rank, it simply means you're guaranteed to be in the index.

Paid Placement: Here, you do pay for a specific placement. Goto is the best example of this, where you bid for certain rankings on specific phrases. In Goto's case, the bids are open and you can be bumped from the top spot at any time. The recent paid placement program announced by LookSmart gives you a bit more of a hold on the top spot, as you pay for a spot for a specified period of time. Paid placement can take the form of the entire set of search results, as in Goto's case, or strategically placed sponsored links, like Google's AdWords.

Engine by Engine

Goto

I have a love hate relationship going with Goto. I disagree with their whole philosophy of providing search results based on who pays the most, but when it comes to getting coverage on the Net for your paid placement listings, Goto can't be beat. Currently, Goto listings can be found on AltaVista, Lycos, AOL, Netscape, Go, NBCi and many other popular online search destinations.

Goto claims to give you 75% coverage of the Net with their Premium listings (these are the top 3 spots). Technically they're right, but the vast majority of searchers still prefer going with the unsponsored search results first. A heading such as "Sponsored Links", "Partner Search Results" or "Featured Results" usually indicates Goto's listings on partner sites. Danny Sullivan has often said he'd like to see agreement on how these paid listings are named, so the user doesn't become confused. I'd have to agree.

According to our numbers, which are taken from the log files of our clients, Goto's main site generates about 5.9% of all search engine traffic. It's a little more difficult to break out the traffic coming from Goto listings on partner sites, but we estimate it adds another 3 to 3.5%, bringing the total to 8.9 to 9.4% of all traffic. Obviously, this is a far cry from the somewhat misleading 75% mark mentioned in Goto's marketing material. This is partly because the 75% number refers to potental coverage, not to actual traffic. It's a big difference, but of course the distinction isn't made too clear in Goto's sales claims.

How much will Goto cost? It really depends on the keywords. A minimum bid is 5 cents per click and Goto has a minimum deposit of $50.00. I did a quick check (on July 16, don't be surprised if prices are higher by the time you read this) on the going price for some keyword phrases at Goto. They ranged from relatively reasonable to downright insane. And the ironic thing is, the highest prices are being paid by people who should know better. You could snag top billing for "Cancun hotels" for $.31 a click. "Hawaiian hotels" will cost you $.41. Want to be number one for "software"? The price was surprisingly cheap at just $.51, but then again, who searches just for software? "Cheap airfares" is $.65. Now, for the other end of the scale. Top spot for "online casinos" is $5.96 per click. "Web hosting" is an astronomical $6.80 per click. Even "search engine positioning" goes for $3.95 a click.

The nice thing about Goto is it's relatively easy to decide if it's worth it. How much are you willing to spend per person to get them to your site? What's your closing ratio per visitor? If my keyword was going for 30 or 40 cents, I'd give it a try. It it's 3 or 4 dollars or higher, I'd have a tough time justifying the cost, which is probably why you won't find searchengineposition.com on the top of the relevant Goto listings.

One other note on Goto that I should throw in before I go. One of our clients has secured top spots for a number of his keywords in Goto. According to Goto's account management tool, he received 183 click throughs for these keywords in one month. But, when looking at his visitor logs, we only found 42 visitors from Goto. Now, these visitors could have come from partner sites, right? Yes, but according to the clients logs, he only received 113 visits from all search engines combined. Confused? So were we. We're currently looking into the situation.

My Rating for Goto, at less than 60 cents:
My Rating for Goto, at more than 60 cents:

For more on Goto, check out the Nov 11. NetProfit, Can Goto Provide a Total Positioning Solution?

Inktomi

Inktomi was the first engine to introduce a paid inclusion program. Currently, you're looking at a cost of $30 for the first URL, with the cost dropping the more URL's you add. It should be noted that every single page on your site counts as a URL, so if your site is 500 pages and you want to make sure Inktomi indexes them all, you'd be paying about $6000 per year.

Is it worth it? It's really difficult for me to say yes on this one. Lately, Inktomi's search partners have been dropping the service faster than Pet.com share certificates. A long line of recent defections have left Inktomi with less than 5% of the total search engine pie. In my opinion, Inktomi is in a doomed middle ground of not generating enough revenue to survive and not offering a good enough product to ever hope of recovering. If you're considering Paid Inclusion on Inktomi, do it for 5 to 10 likely entry pages, including your home page. Don't bother with the whole site.

As I mentioned in a previous NetProfit, Inktomi's recent moves has affected the value of their search results and I think this has been reflected in the number of partners dropping them. As a provider of relevant search results, Inktomi has lost too much ground to the competition, notably Google, to ever catch up. Expect to see more signs of desperation from Inktomi in the near future.

My Rating for Inktomi (top 10 pages):
My Rating for Inktomi (more than 10 pages):

AltaVista

As goes Inktomi, so too goes AltaVista. Like Inktomi, AltaVista is now offering a paid inclusion program, albeit at a steeper price. The first URL at AltaVista will cost you $78 per year, with prices dropping to $48 for the next 9, $38 for the next 90, and $24 for any other URLs, up to a maximum of 500.

AltaVista has become the biggest panhandler in the search engine biz, more than willing to sell it's corporate soul to the highest bidder. In addition to the Paid Inclusion scheme, AltaVista features both Goto and their own sponsored listings, as well as sharing revenue from any Looksmart Business Express submissions done through their own site. AltaVista is on its last legs, as is shown by the fact that their market share of the search engine traffic has fallen in the past year from about 15% to about 7%. Gee, do you think it's because they've totally bastardized their search results, completely alienating users and webmasters alike? Don't be surprised if AltaVista is the next portal to close their doors.

My Rating for AltaVista (top 10 pages):
My Rating for AltaVista (more than 10 pages):

Google

Google has always made a clear distinction between paid advertising and their sponsored listings. And, to their credit, it has resulted in better results and expanding market share.

Currently, Google has two locations for sale.

AdWords lets you create your own ad, which will appear in boxes along the right side of search results for the keywords or key phrases you specify. Each time someone searches for a phrase and your ad is shown, you'll pay one and a half cents. A word of advice to new advertisers. Start with specific phrases very relevant to your product or service and see what your click through rate is. If you go with single generic phrases, you'll be spending a lot of money trying to attract unqualified traffic that won't buy anything.

Google's Premium Ad Sponsorship will move your listing to the top of the page, highlighted in a box for specified key phrases. Rates aren't published on the site, but be prepared to pay substantially more than you would for AdWords

Google's rates for Adwords are quite reasonable, but I have no hard data on click through rates. Google claims their click through rate is up to 5 times higher than the industry average, which would put it at 2 to 3%. If this is the case, you'll be paying about 75 cents a click.

Google does capture a significant portion of search engine traffic. According to our numbers, Google itself generates 26.6% of all traffic, with its Yahoo web page results adding another 8%. Our numbers appear to be much higher than other published ratings, but everybody has shown Google coming on strong in the last year, while other search portals have seen their traffic dwindling.

Other than AdWords and the Premium Ad slots, Google has announced no plans for a paid inclusion Program or any other paid placement revenue schemes. "We have no plans for a paid inclusion program. As we've stated in the past, our search results represent our editorial integrity, and we have no plans to alter our automated process, which works very well in gathering information and delivering highly relevant results," said spokesperson Cindy McCaffrey.

Google seems content to realize their revenue from their two advertising vehicles and by licensing their search technologies for corporate websites. By the way, Google expects to be profitable this year.

My Rating for Google AdWords:

Paid Inclusion..Coming Soon to an Engine Near You

In addition to the paid inclusion programs mentioned above, two other crawler based engines have announced plans to follow in Inktomi's and AltaVista's footsteps. Both Excite and Fast are planning to launch their paid inclusion programs later this year. That would leave Google as the sole hold out amongst major spider based engines from the paid inclusion

Excite

Right now, in addition to Excite's index results, there are also 3 featured listings at the bottom of the search page from FindWhat, a Goto clone. Findwhat's bid prices are a bit less than Goto's ("search engine positioning", 2.22, "online casinos" $3.56, "web hosting" 2.84), but the prominence of the search results also leave a lot to be desired. However, if you're paying by the click, that's not really a concern.

Excite's Paid Inclusion program is still in the planning stages for later this year. Excite@Home, the parent company, is seeing how it will integrate into other subscription services its portal may offer. According to our numbers, Excite currently generates about 8.5% of all search engine traffic.

My Rating for FindWhat/Excite (less than 60 cents):
My Rating for FindWhat/Excite (more than 60 cents):

Fast

Fast is also looking at a Paid Inclusion program, which is currently in beta testing. No word on prices yet. It should be unveiled in the fall.

In the next NetProfit, I'll be looking at Yahoo and the other directories. In the meantime, in the midst of writing this, it seems that consumers are already lashing out at the search engines for "selling out". See our article on this.

For more on Paid Submissions and Inclusion, see Danny Sullivan's recent article on www.searchenginewatch.com

Or the previous NetProfit on Paid Submissions: The Price of Being Found.