Wednesday, May 16, 2007

World of niches - cheap ads for the time being

More material for the Long Tail of Travel project.

Chris Mottershead, boss of Travelzest, speaking yesterday after unveiling the company's new report into Niche Travel, said generic keywords such as "beach", "holiday" or "ski" have become so expensive they are no longer financially viable for bucket and spade holiday providers.

The answer is to focus on niche keywords in pay-per-click advertising as they are (for the moment) cheaper and, crucially, are more likely to convert to a booking.

Interestingly this is in contrast to comments by Martin Dinham from Neutralize in our lead feature in April - How Far Can Travel's Long Tail Extend?. In the article we wrote:

"There is no actual ‘history’ for the thousands of phrases that make up the Long Tail for PPC schedules, Dinham argues, leading to search engines such as Google to ask for a “nominal fee” for bids.

"'Google is actually cutting off the Long Tail in order to get people to bid on higher value search terms,' Dinham says. 'This leads the advertiser to invest in higher volume phrases – so search engine optimisation is actually the better way of accessing the longer tail.'"
So while the industry is being urged to go "Long Tail" with its online search engine marketing, the reality is that already the likes of Google, looking behind what Dinham suggests, have realised a shift into Long tail bidding may in fact impact on its high value keywords.

Kevin May, editor, Travolution

[Exclusive extracts and analysis of Travelzest's Niche Travel Report will be featured in the June edition of Travolution]

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Alex said...

I just wrote a blog post about how travel agents can go "niche" in order to survive the changes in the travel industry

Niche travel agent strategy

Internet Retail Technologies Ltd said...

I question Martin Dinhams Comments.

With respect to PPC, the head and tail perform different functions. Let’s take head terms first and just look at just in the context of Google. To run a head term campaign is simple to manage because by definition you have a small number of terms to operate. Because of this you don't have many separate adverts to create and deep links to put in place or landing pages to produce. The problem is the cost of the click.

As mentioned in the article linked to at the end of this post, because some companies don't mind paying a high fee in order to build brand awareness, or because they are 'finding their feet' with a new campaign and seeing what bid achieves what position (ie actually... not what Google estimates), cost per click can be prohibitive for some. Or some head terms have greater value for some companies than for others, because they have particularly good deals in one product area, offsetting the CPC. So for head terms, caution is the main rule, i would say, followed by good deals with your suppliers.

However, where i disagree with Dinham is that Google is cutting off the long tail. Google provides an estimate on traffic for a term and cost per click, and as mentioned for long terms often has no history. However, once you actually operate a long tail campaign you build your own history which is what really matters.

Take an example outside of the travel industry, a ‘Sheen x300 flame gun’ ( a gardening product... honestly!). The cost for the term 'x300 sheen' over the last 4 weeks has been £0.02 per click. It’s a long tail term, and it captures shoppers in the final stages of their buying process doing a last price check amongst all those companies that rank for the product. This is a long tail term, and yet there is competition. Google haven't cut this off.

So is the long tail becoming more competitive as advertisers move down from head terms? Probably. The question I would ask is how much of this competition comes from 'Broad matching'. Broad matching is Googles default. If you add the term 'Spanish holidays' to your campaign by default Google will serve up the advert to users who have searched similar terms. This, you could argue is inadvertently creating competition at the long tail; the 'similar' terms, which will increase the cost per bid.

Over-ridding Broad Matching with 'Exact Matching' is not exactly on the front page of the Adwords admin panel. Some would be skeptical.

Not wanting to go on, but a final point would be considering 'the long tail' in its broadest context. Not just PPC and SEO, but as a whole. David Soskins commented in a recent presentation that ‘the Internet is suited to the long tail’. This is very true in it’s widest sense. In theory it’s a medium to access any information. But what has changed in recent months is that that 'anything' has grown exponentially with social media and blogging. The quantity of information, views and experiences is growing fast, some of which will be very important for online vendors as shoppers seek to validate their buying decisions buy reading company information, destination information, user comments, personal photo collections, and experiences.

Is the long tail, in general terms, in the process of expanding massively and if so how is this quantity of information filtered, sorted and served up to find the guy that wants to know about the dangers of having a sugary cup of coffee on the sleeper train from Moscow to St Petersburg. Google has ten organic slots and returns millions of results. I would say deep search rather than ‘surface search’ in vertical markets has a big future.

Travolution Blogger said...

IRT Ltd: thanks for your lengthy and valuable post.

David Soskin's PPT, as mentioned in your post, is available from our Special Report page here.