Organic Search Seen Dramatically Undervalued in Conversion Path

March 15, 2012

This article is included in these additional categories:

Analytics, Automated & MarTech | Data-driven | Digital | Paid Search | Retail & E-Commerce | Search Engine Optimization

slingshotseo-channel-valuations-march2012.jpgLast-touch attribution models drastically undervalue the contributions of organic search and non-branded organic search to multiple-interaction conversions, while overvaluing direct visits, finds a [download page] a March 2012 study from Slingshot SEO. The analysis examined 23 million multiple-interaction conversions across 30 domains throughout 2011, and compared results from using a last-touch attribution model (where the last in a series of interactions gets all the credit for a conversion) with results from using a flat multi-touch attribution model (where the value of each conversion is divided equally among each channel in the path).

Slingshot SEO’s analysis rests on the argument that the last-touch attribution model assumes that the final marketing event was the only influence on the user, and ignores the previous paths, although users often interact with a website several times before converting, and are influenced by each channel. By contrast, the multi-touch attribution model assumes that each interaction has equal influence on the user and that each interaction plays a role in any given conversion. The report notes that each interaction may not have equal influence, but that the model gives a truer sense of the influence of each channel in the purchase path.

Direct Visits Overvalued

The report indicates that for the 30 businesses studied from January through December 2011, users took 2.79 interactions before converting. Direct visits received too much credit for conversions under a last-touch model, as they were often the last interaction before a conversion. As a result, other channels such as organic search, paid advertising, and referrals were typically undervalued. Organic search in particular was most undervalued, as the channel drives sales and conversions from the top of the funnel as users start their research.

Organic Search Undervalued By Up to 77%

To calculate how different channels were being over- or under-valued among the websites’ conversions, Slingshot SEO divided attributed conversions (the conversion value attributed to each path in the multi-touch method) by last-touch conversions (the conversion value attributed to the last path by the last-touch method), and subtracted 1. For all 30 websites, organic search and non-branded search were being undervalued by a last-touch model. In fact, multi-touch attribution showed that organic search should have been worth as much as 77.25% more than previously thought, and that non-branded organic search should have been worth as much as 81.59% more. Looking at specific client categories, non-branded organic search was most undervalued for the majority of retailers and general merchandise websites.

Meanwhile, for all 30 websites, direct visits should have been worth up to 35.74% less than previously thought.

Although the contributions of organic search may be undervalued by last-touch attribution models, marketers certainly recognize the importance and value of search engine optimization: March 2012 survey results from Econsultancy and Adestra indicate that almost 8 in 10 global company marketers rate SEO as either excellent (31%) or good (48%) in terms of return on investment (ROI), beating out other channels such as email marketing, paid search, affiliate marketing, and social media.

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