Search's Major Impact on Offline Conversions

Online marketing still has a stigma: that if you’re advertising to an online audience, that audience will only interact with your company online, and thus, only online conversions need to be counted as search return on investment (ROI).

While the most obvious means of measuring search return on investment (ROI) is by clickthroughs and purchases, new research shows that it’s only a sliver of the overall picture. If you’re focusing only conversions taking place on your Web site, you may be missing out on the vast majority of behavioral data and revenue benefits resulting from search marketing.

Majority of Conversions Take Place Offline
A recent comScore Networks and Overture Services study followed consumers searching for computer or consumer electronic products. Approximately 12 weeks passed from their first product search to their eventual purchase. The really intriguing fact is that a whopping 92 percent of purchases occurred offline!

That finding has led to more research on the online research/offline purchase cycle and a similar pattern can be seen in other verticals. For instance, approximately 40 percent of search engine queries are for local businesses and services and other research shows that 92 percent of local searches also convert later offline. This further verifies this consumer behavior pattern.

Would you even think of basing an offline campaign on the purchase patterns of just 8 percent of your audience? Not likely. The impetus then, is on how to measure search’s success. If retailers are focusing only on their online ROI, they’re not likely spending enough on search. Increases in search marketing budgets could exponentially increase their revenue by reaching more potential customers – the majority of which will convert offline.

Education is Key to Proving ROI
To rally for an increase in your online marketing budget, those involved in search marketing would be wise to educate their offline marketing team on the less-than-immediate conversion cycle of search.

"Many marketers who are evaluating search marketing are demanding a short-term ROI when, in fact, they're willing to accept short-term losses for their print, radio, and TV spending," said James Lamberti, VP of comScore, who managed the above-mentioned study. "From my perspective, you have to consider search marketing in relation to everything else you're doing."

Realizing that search marketing may be playing a bigger role in sales than expected, online marketers may be due more credit than previously realized. While traditional campaigns may still be contributing to in-store traffic surges and sales, it could very realistically be that it is search marketing’s 4-week sales cycle that is bringing more purchase-ready customers in the door.

Modifying Your Strategy: Brick-and-Mortars and Local Businesses
The easiest place to start taking advantage of the 92 percent offline conversion knowledge is to analyze your messaging. Instead of trying to modify your audience’s purchase patterns, try adjusting your natural and paid search campaign creative to reflect in-store sales and events more regularly.

Additionally, improving statistical data is imperative. Start including questions about your web site in check-out and post-sale surveys.

"Retailers tell us their store customers often visit their Web sites first, and they know search drives a good deal of their site traffic," said Diane Rinaldo, director of strategic alliances at Overture. "But there seems to be a disconnect in tying together search marketing and offline behavior. This research helps retailers see what a vital role search plays in closing the loop in their interaction with their customers."

Modifying Your Strategy: E-Tailers
The bad news is it will take more work to persuade an online sale than an offline one (according to this and similar studies). But the good news is that it’s much easier to track behavior from initial search to sale. Knowing which keyword strategies are working most effectively, at which search engines and at what time is much simpler when you’re focusing only on an online sale.

Benefit Today
As more marketers discover that search’s influence on revenue extends far beyond the clicks and conversions online, more attention and money will flow to search and better analytics will follow. But there’s no reason not to re-think your search strategy now. This research opens up the door to better understand the purchase cycle of a couple representative audience segments and should help brick-and-mortar companies and e-tailers prepare better messaging to capture attention for the long-haul – all the way to that in-store or on-site sale.