Paid Search beats Conversion Rates of Organic Search

Posted by webmeasurement on September 25th, 2006 filed in Websidestory

Websidestory today announced the results of a new study that shows paid search has only a slight 9 percent edge in conversion rates over organic search. In a study of leading business-to-consumer (B2C) e-commerce sites during the first eight months of this year, paid search — keywords bought on a pay-per-click basis at search engines such as Google, Yahoo and MSN — had a median order conversion rate of 3.40 percent at business-to-consumer e-commerce sites using the company’s award-winning HBX Analytics technology.

Paid v. Organic Search
    Median Order Conversion Rates at Business to Consumer E-Commerce Sites
    Jan.-Aug. 2006

    Marketing Channel                 Conversion Rate
    Paid Search                       3.40%
    Organic Search                    3.13%

This compared to a conversion rate of 3.13 percent for organic search results, defined as non-paid or natural search engine listings, during the same January-to-August timeframe, according to the WebSideStory Index, a compilation of e-commerce, site search and gloobal Internet user trends. The study analyzed more than 57 million search engine visits. Order conversions occurred during the same session.

“For both paid and organic search, you have highly qualified traffic that converts far above the overall conversion rate of about 2 percent for most e-commerce sites,” said Ali Behnam, Senior Digital Marketing Consultant for WebSideStory. “In the case of paid search, marketers have better control over the environment, including the message, the landing page and the ability to eliminate low-converting keywords.”

“There is a strong synergy between paid and organic search. The bottom line is that marketers need to optimize both to achieve maximum results,” said Heather Lloyd-Martin, an author and the President and CEO of SuccessWorks (, a search engine optimization firm. Lloyd-Martin is also Chair of the Direct Marketing Association’s Search Engine Marketing Council.

“With conversion rates 50 percent or higher than overall site conversion rates, both paid and organic search remain a very important acquisition source for online marketers,” Behnam said. “However, it is important to note that these are not typical results. Our clients are steeped in web analytics best practices and understand better than most how to truly optimize their search engine marketing campaigns and conversion rates.”

HBX Analytics is an award-winning on-demand web analytics solution providing actionable analysis of online visitor and customer behavior. HBX Analytics is part of the WebSideStory suite of integrated, on-demand digital marketing services, including web analytics, site search, web content management and keyword bid management. More than 1,500 enterprises worldwide use one or more applications within the suite. For more information, please visit

Sample Size and Methodology: More than 57 million search engine visits to nearly 20 major business-to-consumer e-commerce sites using WebSideStory’s on-demand web analytics technology. These sites generate an estimated US$2.5 billion per year in online sales. Order conversions occurred during the same sessions.


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