The War on 'Free' Clicks: Think Nobody Clicks on Google Ads? Think Again!

101

Do People Click on Google Ads?

If you use Google search (and who doesn’t), you may have noticed that sponsored results (Google pay-per-click, or PPC, ads) have been taking over more and more of the search engine results page.

Here at WordStream, we’ve noticed that too! So we decided to do some research into what impact all of these new, bigger, more prominent and engaging ad formats are having on the average Google searcher. The results are astonishing:

Clicks on paid search listings beat out organic clicks by nearly a 2:1 margin for keywords with high commercial intent in the US. In other words, 64.6% of people click on Google Ads when they are looking to buy an item online!

Click here to skip ahead:

Now, to be clear here, organic searches still get more clicks overall than paid search – but not all keyword searches are created equal. Keyword searches with high commercial intent – meaning, keywords where a searcher is looking to buy a product or service (for example: “buy stainless steel dishwasher”) – are worth far more to businesses than your basic informational keyword searches (for example: “who is Thomas Edison”). Our research found that for valuable, high commercial intent keywords, paid search advertising listings gave the “free” organic search listings a resounding beat-down. Naturally, we’ve illustrated the results in an infographic. Click the image to see the full-size infographic:

Google Ads and the War on Free Clicks.
© 2012 WordStream, a Provider of AdWords and PPC Management Software.
 

What’s Driving the Organic Search Listing Smack-Down?

Much to the delight of internet marketers, new, bigger, more engaging and more targeted sponsored ad formats – which allow businesses to target prospective clients in more precise and relevant ways – are behind the increases in CTR for high commercial intent keyword searches. These new keyword advertising formats include:

  • Product Listing Ads: In May of 2012, Google transitioned the previously free Google Product Search into a "Purely Commercial Model." Product listing ads include large images and are automatically triggered if someone searches for a product that is in your Merchant Center account.
  • Click to Call Ads: This powerful mobile ad format lets customers call a business phone number with the click of a button.
  • Bottom of Page Ads: Catch their attention before they click to page 2 or refine their search.
  • Mega Site Links: This huge ad format offers up to 10 additional places to click, greatly increasing your chances of presenting a relevant link.
  • Social Ad Extensions: Show who has +1'd your site, which lends credibility and potential name recognition.
  • Remarketing: Allows companies to track site visitors with a cookie and chase them around the Web, displaying relevant banner ads until they click and convert.
  • Map/Location Ad Extensions: Display your address and phone number to local searchers, enticing them to visit you faster. Advertise only to customers in the vicinity.
  • Chat Ads: Prompt viewers to open a chat window with a sales guy – get those leads while they're hot!
  • Email Ads: Prompt users to provide an email address right from the search result page.
  • Etc.

Couple these and other exciting new ad innovations with the fact that approximately half of searchers still can’t differentiate between paid and organic search listings, and you can quickly see what’s happening here. Advertising on Google will become a means to survival on keywords with high commercial intent, and the best advertisers will reap the benefits. (More on the importance of intent in marketing here.)

Get a Free Google Advertising Report

A War on Two Fronts

While these innovative new paid search advertisement options are rapidly growing in size and power, Google is simultaneously waging all-out war on SEO web spam. Over the past few months we’ve seen significant updates that make it harder to rank in organic search, including:

  • Panda Update (Feb 2011) - Google cracks down on "thin content" and ad-heavy sites. Up to 12% of search results are impacted.
  • Google Analytics Update (Oct 2011) - Google stops providing reliable access to organic search query data. Advertisers basically need to use AdWords to get full access to search query data. (Click here for more tips on dealing with the "not provided" fiasco.)
  • Matt Cutts Threatens to Penalize SEO's (March 2012) - At SXSW, Matt Cutts issues a warning to sites doing “over optimization,” declaring: "we want to make that playing field a little bit more level."
  • The Shot Heard Around the SEO World (April 2012) - Google warns an estimated 1 million websites about unnatural links and orders webmasters to cease and desist these manipulative activities.
  • Penguin Update (May 2012) - AKA the "Over Optimization Penalty" or "OOPS." Google devalues sites employing keyword stuffing and spammy link tactics.

The net result is that organic search has become significantly harder and more costly to execute, nearly impossible to measure, and yields increasingly unpredictable ROI.

SEO vs. PPC: Who’s Winning this War?

It’s too early to declare a victory for either side. The one thing that is clear from our research is that the board is set and the pieces are in motion.  What do you think of the shifting battlegrounds here? Let me know what you think in the comment fields below.

Acknowledgements

A special thank you to my colleagues, Miranda Miller (Search Engine Watch), Aaron Wall (SEO Book), Tom Demers (Measured SEM), AJ Kohn (Blind Five Year Old), and Elisa Gabbert (WordStream), all of whom provided incredibly valuable input and commentary into the design and data of this research study.

Survey Methodology

Our survey was limited to advertisers in the US, for Google Search only. In our survey, we define high commercial intent keywords specifically as keyword searches on Google that have significant advertiser competition and trigger a Google Shopping or Google Product Listing ad.

We used recent average click-through rate data collected through our AdWords Performance Grader across over one thousand AdWords accounts in the last 60 days. We also looked at the Google Analytics/Webmaster Tools and AdWords account data of WordStream’s managed accounts to analyze organic click-through rate data and trends.

Because people often click on multiple ads and/or organic search listings from a single search result page (which makes the click-through rates of all of the paid and organic listings add up to more than 100%), we normalized the CTR data to reflect the % share of traffic generated for each paid and organic search listing present on a typical search engine results page.

Hit me up on Twitter

 

 

Find out how you're REALLY doing in AdWords!

Watch the video below on our Free AdWords Grader:

Visit the AdWords Grader.

Comments

Michael
Jul 31, 2012

I can say locally PPC doesn't touch high organic rankings, at least when it comes to bringing in the client. We have a plumber based in one of the top 10 markets in the US and he is ranked #1 under most keyword searches. We also did a PPC campaign for him as a test and what we found was the offer on the organic page is what kept being brought in or mentioned to him over the offer (a little better offer by the way) that was on the adword landing page. Both pages laid out the same, only true difference was the offer code and the organic code was 4x more effective than the PPC offer code.So while your study shows one thing (of course you offer PPC software and services so it makes sense, I bet there are a lot of companies out there like ours who ran tests and saw the opposite results).With that being said I believe everywhere you can be to generate a client is where you need to be. Some returns are better than others, but if your making at least 3x your investment you should be everywhere your company can afford to be. I think some people forget the priciples of marketing never change, just the platform :)Thanks for the article.

Risa
Jul 31, 2012

After penguin, my company's sites (about 30 - 50 sites) were affected, we can't stand traffic loss,we only could use more and more adwords to keep traffic, but adwords is not our best choose.Cost too much, get too less, we need improve our SEO techniques instead of using the Google ADWORDS.

Robert
Aug 01, 2012

The search market is screaming for someone to take on Google properly. I don't always want to search for the companies that have the biggest advertising bucks to spend.Hopefully Yahoo! will get it's search act together or some new startup will get enough traction to allow true competition in the search marketplace.

tanıl
Aug 01, 2012

Thank you for sharing 

Corporate Retirement Gifts
Aug 01, 2012

Very good write up, but lots of information packed in. I agree that it depends on the keywords. I find that my sites receive more organic clicks than PPC.

Bill Taylor
Aug 01, 2012

Great article Larry and the Team, I also found the infographic very well done and it conveyed the points well.For sure SEO is not going away anytime soon and it is important also to do PPC in conjuction with it - always has been to some extent.I think Google have turned to being one of the most corrupt companies on the planet. They will do almost anything they can get away with to make money and don't care who they hurt to do it.They are constanltly misleading people as to their real reason for doing things. In the process they are deceiving the searchers who use their SERPs and take advantage of their ignorance.I certainly believe that Google will not be around too much longer as more people are seeing through them and their manipulation of the masses. Of course it also shows how their shareholders can also be manipulated to let them get away with doing anything for money - same as the banks.Keep up the good work.Bill 

Furore
Aug 01, 2012

I think this is a very nice infographic. I still think the best combination for a campaign is SEO with a good Adwords campaign. The one makes the other stronger. Grtz from Holland.

Donald
Aug 01, 2012

Clicks, Schmicks! Google must have paid you for this info-graphic. The thing is not the clicks the thing that is important in the niche you selected. "Links with High Commercial Value". My experience is people do click on Google paid links and free links both, and probably at about the same rate, but the paid links have negative returns on investment due to Googles monopoly on the ad sales business. Every search engine has a relationship with google, and without competition paid ads will produce poor results. Back when things got started with Overture, which was bought by Yahoo and then Yahoo signed a deal with the Devil since they signed a deal with Google instead of continuing the suit and running Google out of businsess for stealing the patented technology Overture had invented, yeah they got millions for it, but lost Billions!  Advertisers should boycot paid ads until there is true competition. There used to be and it cost 25 cents to get a click, and then one in 300 clicks resulting in a sale meant Advertisers could actually make money. Now when clicks cost multiple dollars, ROI is out the window. I got a call from Google adwords saying my click through rate was too low and that is what I asked the sales rep, and she had no reply. She did not care at all about the fact my purpose is to make money for me, not Google and that their model is broken as a profit generating model. So your thesis is accurate, both free and paid links get clicks, but at what price? The assumption that a click is valuable in and of itself is not accurate. Some states Attorney General needs to look at the revenue sharing deals that every major company has with Google and break them up like AT &T was years ago. Does anyone know of a single major search company that has paid clicks that are not some how tied into the Google  revenue stream? Major being the key word. Because the "little guys" have even worse ROI than the monster G! Nice infographic, but not the right angle to pursue. 

Debarup Mukherjee
Aug 01, 2012

So, what will be the senario after 2 or 3 years for SEO industry or Internet Marketing agency or Digital Marketing Agency?  

Sanford Scolex
Aug 01, 2012

I can't believe people in the comment section are actually eating this food.  I know how this article was written.  The author searched, "PPC vs Organic click rate" clicked on the first paid ad he saw, copied the stats then wrote this terrible article. Larry why not list the sources of this information? Because it would discredit the whole article. This infographic is a direct example of why Matt Cutts is going to start discrediting inforgraphics -  packed with misinformation...Thanks for ruining it for the rest of us.

Mike
Aug 01, 2012

Biased article.  I was doing incredible with 30 phone calls a day on the organic side with over 300 clicks a day.  Panda and Penguin came forcing my hand to PPC and now nothing.  I spend $500.00 a day on 6 or 7 unqualified shit calls.  PPC will never match organic search; not in my industry at least.

arcus
Aug 01, 2012

Great infographic. Decoding it took me 3 hours.

Sara
Aug 01, 2012

Why is it that every time I read more of what Matt Cutts is doing next, I find it harder to know where I'm at again in the "zig-zag course" of sequential disenchantment? Will they ever make up their mind, so we can begin to learn the rules and just spend our time applying them?

Magnet Mailers
Aug 02, 2012

Nice article, Larry!  But none of this should be news to those of us who market on the web.  We all track our clicks / conversions on a daily or weekly basis, and can see the results with Adwords, and without it.Should we be surprised that a search engine chooses to maximize revenue, while trying not to 'turn off ' its users? Probably not.Sure, the ads for High Commercial Intent keywords get lots of clicks.  Google users may believe those links are more relevant -- more likely to provide a useful commercial experience.When you want to buy a dishwasher, you go to the mall, not the library.Your article should be a wake up call for those who've built their web marketing strategy on SEO koolaid.   

Who Cares
Aug 02, 2012

Good for marketers? Is that a joke? Please. Doesn't anyone realize that clicks become more and more expensive and push everyone out but the larger corps with bigger budgets? Wake up. Where's the infographic for rising cost of PPC ads?

Jaimyn
Aug 06, 2012

Awesome infographic with great content. I love seeing exact percentages on these types of case studies. I agree with nearly everything that the graph states. PPC is becoming increasingly important as SEOs need to become more like brand managers due to all these funky algo changes. Companies with a strong brand presence both online and offline will be the ones winning the internet marketing game.

Incentivi Fotovoltaico
Sep 06, 2012

This is a fantastic Infographic!Thanks!

Applepie
Jul 25, 2012

Jordan I agree with you, the methodology and data are not very transparent and performance for PPC and SEO varies by industry, a data set like this that is not industry specific can be very misleading. A consumer purchase journey does not begin at the purchasing stage and the digital ecosystem is complex , a better way to show a sound infographic is to show mix matrix for SEO, PPC and Social.

Sycara SEO
Jul 31, 2012

Yep those billions they are making are not coming from organic 

Elisa Gabbert
Aug 01, 2012

The sources are listed. It's easier to see the sources if you look at the full-size infographic.

Who Cares
Aug 02, 2012

Well said

Anonymous
Sep 13, 2012

Well, our experience is exactly the opposite to yours. Typically the only local clients where Organic outperforms PPCare those that have strong local brand recognition. They are easy to spot as you will find lots of searches on theircompany name and those searches tend to click on the organic results.Most of our local clients get at least 30% (and ranging upto 80% for new clients) of their traffic from PPC. Thisincludes clients that have top ranking organic listing and top ranking places listings.There are many things that go into a successful PPC campaign ranging from the keywords you select, negativekeywords used, quality of the ads, quality of the Landing Pages, etc.  As an additional bonus for PPC we find thatthe PPC traffic converts better than organic traffic.Now, every niche and geographic area produces different results and I fullu concur that the best thing you can dois to get a top PPC, a top organic. a top Places and any other top rankings you can.the more you can dominatethat first page the more leads you will get!

Anonymous
Jul 21, 2013

I know that nobody ever thinks of this, because they're always too busy bowing down before Google -- but is there a chance Google will ever be busted by the Feds for anti-competitive reasons? Google's the 800 pound gorilla, and we all know they act the role. They're also (apparently) the Internet police and think it's their duty to run the Internet the way the U.S. runs the world.The Feds took down Big Telephone in the 80s because they were simply too big.Right now, Google dictates the pace of everything with their extremely powerful search engine and massive online advertising system. They also- Compete with their advertisers in pay-per-click- Build websitesAlmost like a casino house that competes will all its gamblers. Over the long term, who's most likely to really come out ahead?We all know Google's trying to kill organic search, because they're just a big, greedy company with stockholders to feed. I'd be real curious to know if the Feds will ever step in to do something about  it. Only in bible stories does David normally beat Goliath. 

healthy sexy hair
Mar 17, 2015

Touche. Great arguments. Keep up the amazing work.

Blondell
Apr 13, 2015

bookmarked!!, I really like your web site!

frangir
Nov 08, 2015

Here is a misconception among many business
owners that mystery shopping is simply when a secret shopper comes into youjr location and grads the performance of your place
of business. But, mystery shopping is so much more thaan that.

Prestiti Personali
Jul 17, 2012

This is a Cool Infographic!Very Compliments!

Online Marketing Toronto
Jul 17, 2012

Organic results get more clicks than the paid one. How many of us click those  advertisements? The answer comes only 3 or 4 out of 10. Organic results have won over paid ones.

Elisa Gabbert
Jul 17, 2012

How many of us click those  advertisements?More than you think, according to our research! But it depends on the nature of the search query.

Steve
Jul 19, 2012

Elisa, that's the bottom line, imho, it depends on the keyword/key phrase.When the user has completed their research and is ready to buy, PPC is relevant and utilized

Marc Nashaat
Jul 17, 2012

Great data here although I don't see the link/image for the infographic anywhere. What you have mentioned here however reaffirms the idea that PPC and SEO compliment each other marvelously (awesome resource on that here: http://www.seomoz.org/ugc/8-ways-ppc-and-seo-are-better-when-used-together). 

Elisa Gabbert
Jul 17, 2012

Are you not seeing the infographic in the middle of the post? Do you by any chance have Ad Blocker on your browser? Here's the link to the full infographic: http://www.wordstream.com/articles/google-adsThanks!

rama
Jul 17, 2012

no offense, the infographic was not easy to read. It looks overloaded but appreciate the time u spent in collecting the data

Elisa Gabbert
Jul 17, 2012

Much easier to read if you click to enlarge, FYI.

JesseCWalker
Jul 17, 2012

Boy did that Aaron Wall quote scare me.  Do you Wordstream folks think that SEO is going the way of the Dodo?  My experience with clients is that SEO is the highest ROI of any marketing channel.  

Elisa Gabbert
Jul 17, 2012

No, not really -- not anytime soon! But we do think it's getting increasingly complicated, especially for small businesses with limited resources. SEO and PPC should work in concert.

Nick
Aug 01, 2012

Nice infographic, I do not completely agree with with the PPC stance against organic, but oh well. Very good point on the SEO 2008 and 2012 (from one SEO specialist to a whole team)I would be keen to learn more on case studies on your SME clients who have successfully adopted PPC and have been doing it profitably for a serious amount of time (2 years+)Often small businesses have small, limited budgets, and PPC campaign always has an extent of learning curve within it, and that does not come without a cost.As it stands, for small businesses (in niche industries/local market, with limited resources), I believe organic results are the way to go. Oh yes, and I'm still looking for that person who tells me that they are so much happier with paid advertisements on Google, and how they are so much better and more relevant than organic results. Oh well.  

plr article contents
Jul 18, 2012

Excellent article. I am a paid advertiser on google. I can say for sure that people click more on my paid listings than my organic listings.

Michael
Jul 31, 2012

If your not ranked on top that would be the case :) Otherwise if you were one of the top 5 results you would notice while they may get clicked the same or even a little less your Organic is where the business is coming from. Just my thought from running my own tests.

Tony Leung
Jul 18, 2012

Well I would have to agree with the author of this post, PPC is more succesful as of now, in the past my business have made profits after I hired a SEO team, but after the google updates my business have suffered, and now my team of SEOs recommend PPC, so I am running an adwords campaign to survive and make some profit, the ROI has decreased but I have no choice, I am starting to hate google!

Will Quick
Jul 18, 2012

This is something I'd been nervous about for a while.  It is somewhat terrifying to see it in such plain black-and-white. Great infographic.  I found it through Inbound.org btw.

Anonymous
Jul 18, 2012

The infographic is too much cluttered with images. I just scanned it. ;(

Corri
Jul 18, 2012

Fascinated that Google would erode it's core purpose which is organic search.For a consumer the relevance is driven from organic search, not censorship surrounded by AdWords. Ask the TV broadcasters whether a high rating show is relevant to their ad spend.As Google continue to obliterate organic results they also decrease their relevance and promote the alternate search engines and niche destination sites.Though I understand the market forces driving Google into this behaviour unless they find balance the alternates will steal market share at a rate that will surprise all.  

KS
Jul 19, 2012

This infographic, while it has some truths is mostly inaccurate w/ specific situations used to make generalities or is complelety false.Terms such as "highly commercial intent searches" has no definition or implied SEO meaning, therefore is not a measurable concept. Much of this data has no given source point (the percentages) and directly contradicts other well known and well researched reports.  And percetages such as 8.9% on Sears Organic results unless you work for Sears and have access to their analytics or pixel data (which if you did I doubt you would be allowed to place here) then anything else is from an estimating software which is usually quite a bit off and has to be validated with real world testing. NOTE: SEOs in 2008 did and still do all the same things listed as separate jobs in 2012. Just because you did not know that SEO has always been all these things does not mean we weren't doing it. This infographic was made to make a point, not inform. Research is the unbiased revelation of information to support what the research shows us even when it contradicts our viewpoint. Thi sis NOT research. It is a flimsy excuse for research puffed up by cute graphics to support a PPC approach. In addition your methodology is inherently flawed as we would say it is a snowball sample. Snowball samples are never used to state facts because the method is so flawed as to make it impossible to do anything more then note trends on which research can be done.

Larry Kim
Jul 19, 2012

Hello. We're using Google's own definition for High Commercial Intent Keywords - Meaning, keyword searches that triggered the google product listing / google shopping ads. I think this is a pretty clear definition.Additionally, as i mentioned in the survey methodology, our data normalized the click through rates to see what % of the clicks were going where. I'm guessing you're used to seeing much higher click through rates, due to the fact that people will often click on 2 or more different listings on the same search result page.  I just normalized the data to add up to 100% (instead of adding up to 200% or 300%).I guess the flack only gets heavy like this when you're over the target!

Raz
Feb 24, 2015

I also agree SEO in the long term will a far better advert than PPC.

Solely because of Google Hummingbird, SEOs will now be able to target conversational keywords to attract the right users online.

Derek
Apr 06, 2015

Google made off with the best real estate - and so they should. The top 3 paid positions are eating up the bulk of the clicks for the average keyword/phrase. 4 years ago I would have spent a lot more time and effort on SEO and organic rankings for all relevant keywords. Today we definitely optimize and spend some effort on the primary keywords but PPC is the way to get results today. The work required to get to #1 organic for relevant keywords is just too great to get 8.9% of the clicks for that phrase. SO while the numbers vary from study to study, it is clearly the way Google is trying to lean the game. Think blend of PPC and SEO (paid and organic) and watch where you invest your hard earned efforts.

suyanto
Feb 27, 2016

No Surprise, but IMHO some of the click are from people looking for information or research for something he wants to buy, so he just click the first ad at the top spot.
After he gather some information he will compare it with ad from other spot and from organic SERP.

Jack Morgan
Mar 31, 2016

fwiw, I use adblock plus and i never see the ppc ads, adword campaigns on other sites, or pretty much any ads anywhere. i wonder if that is a factor.

Mitesh Sanghvi
Apr 01, 2016

I'm new to this SEO thing, but I still understand the fact that nothing is permanent. If you think something is changing, then it's part of the stream and you have to learn experimenting in a situation and coming up with a working plan in every situation. :)

Pages