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Local SEO vs SEM: What Drives More Revenue?

Posted by Brandon Martinez on Apr 14, 2017 5:12:41 PM
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Where is your traffic being generated?

When was the last time you clicked on an ad when searching on Google? A week ago? A month ago? A year ago? Never? (Let us know in the comments below!) The question then is posed…if consumers are not clicking on ads, where is your traffic coming from? Over 50% of click through traffic is going to the top 3 positions on the organic search results page (different from Google Maps searches). Yes, the local three pack, as well as the organic listings are flooded with traffic from local searches while the ads capture only a few clicks here and there.

Google alone handles over 2.5 million local searches every day, that accounts for 46% of all user searches! For businesses, this means the best way to drive more traffic into your stores and convert more customers is to land your business listings right where customers are looking, on page one of the local search results! But what should you invest in: the easy to measure clicks from pay per click (PPC) or a sustainable and highly effective local SEO strategy?

The real question to ask is: "Do your customers click on ads?"

This is reflected specifically by what consumers are clicking on. Across all industries, the average CTR for a search ad is only 1.91%, and even less,  0.35%, for a display ad. Why?  Up to 80% of local search shoppers will completely ignore advertisements located in the search results. That percentage doesn’t even include the number of people who recognize and read paid search ads, yet still decide not to click on them. The vast majority of today’s consumers have trained their brains to completely bypass search ads and scroll directly to the organic search results.  In addition, the trust is gone.  People are less likely to trust ads and content coming from businesses, so they just skip right over them.   

Many businesses turn to PPC ads as a strategy for generating more traffic because it is much faster and easier to implement and there is more accurate tracking methods compared to a SEO strategy. PPC ads will create visibility and generate revenue, however, they are much more expensive in the long run and not a sustainable solution for generating high quality leads and an authoritative online presence that shoppers will trust.

Why is Local SEO a more effective strategy for generate customers and increasing revenue?

In a recent survey, 89% of people admitted to searching for a local business at least once a week or more and another 58% searched for local businesses daily. Of the over 2.5 million local searches going on each and every day, nearly 80% result in a purchase! 50% of consumers who perform a local search visit a store within one day!

So, now that we know local search is important, let’s take a look at the behavior of consumers interacting with those results.   

According to this study, the #1 organic search results received nearly 30% of total click through traffic.

The number two and number three organic listings on page one receive 13.1% and 9.2%. That’s over 50% of the traffic going to the top three positions! When consumers are quickly scrolling past the PPC ads it is because they are looking for the organic results that are objectively ranked by search engines. The number of different ranking factors that influence the organic search results create a sense of trust and credibility among organic results.

Local SEO Rankings Businesses that can reach the top of organic local search results will enjoy greater visibility and higher click through rates which leads to increased revenue. Across 10 different industry verticals, we calculated that with an average 4% increase in page 1 visibility, businesses can increase their revenue by an average 6.5% per store, per month! That means a very small investment in local SEO can equal a relatively huge increase in monthly revenue. that is just the beginning, you can’t just be on page 1 to get traffic coming into your store.

Getting your listings to page 1 of Google is just the beginning. Once consumers find you on page one, that is when the real competition begins. Search engines have made it incredibly easy for users to compare all of your content directly to your competitors. That means your ratings and reviews, photos and videos, and your brands interacts with customers will be competing directly with the content of the other top results. The business with the best reviews, most informative media, and highest review response rates will ultimately win the customer's business and generate greater store traffic.

Overall, having your listings at the top of the organic local search results (remember, this is different from searching directly on Google Maps) is an authoritative and trustworthy position that gives your business the opportunity to outshine your competitors and increase your traffic with the most qualified customers.

Don’t get me wrong, getting to the top of the local search results isn’t a no brainer and competition for those top local organic positions is intense, but with the right tools and a great local SEO strategy, your business can earn and retain that top spot.

PPC advertising isn't a completely lost cause

If we are being realistic, right now you aren’t on the first page of search results for every keyword you are trying to rank for; chances are, you are hardly on page one for any of them. It will take some time to get your listings on page one, so until then you can keep running PPC ads to increase visibility for your lowest ranking keywords. However, once you begin to see improvements in visibility and local search rankings it is crucial that you continue to invest in local search rankings rather than PPC ads in order to keep those highly valuable organic search rankings.


Chatmeter is a great Local SEO solution for reaching Page 1

Hundreds of different factors contribute to how search engines design their local search rankings and the majority of businesses don’t have time to keep track of the constantly changing algorithms. Luckily for you, Chatmeter is an expert at local search and has designed some of the smartest, user friendliest tools that any business can use to improve their local search rankings. Schedule a FREE demo today and find out how Chatmeter can help you reach the top of the local search rankings.

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Topics: Local SEO

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