Search engine rankings (by keyword) and click-through rate
Strategic perspective
Marketing and sales perspective
Key performance question this indicator helps to answer
How well are we optimising our internet strategy?
Why is this indicator important?
Along with page views and bounce rates (see KPI on page 155), search engine rankings (by keyword) and click-through rate are among a number of metrics that are used in website traffic analytics for assessing the effectiveness of an organisation’s internet strategy in attracting and gaining value from visitors.
Search engine rankings (by keyword) is simply a measure of website ranking based on relevant keywords. Unlike web directories, which are maintained by human editors, search engines operate algorithmically or are a mixture of algorithmic and human input.
The goal of achieving a high search engine ranking is to increase website visits. Simply put, the higher the ranking the greater the likelihood that a person browsing the web (a searcher) will visit your site (obviously they are more likely to look at a website that appears on the first page than at one that appears on page 9 or 10 – see Tips/warnings). This is called the click-through rate (CTR), which simply means the percentage of time that a searcher clicks on a website displayed in their search results versus a different site. CTRs are impacted significantly by the search engine ranking for a particular keyword. At present, the most dominant search engine worldwide is Google.
How do I measure it?
Data collection method
The online collection of rankings from search engines, such as Google.
Formula
A search engine ranking is simply a website’s position on the search engine ranking.
Consider the following as an example of measuring a click-through rate. As reported in the book The Small Business Owner’s Handbook to Search Engine Optimization (see References), a site that has earned a Google ranking of number one for a particular keyword produces a Google click-through rate of 42% versus the site that is ranked number 10, which produces a meagre 6.06% CTR.
Frequency
Search engine rankings and click-through rates can be measured on an ongoing basis but will be reported in line with the organisation’s reporting cycles.
Source of the data
Search engine rankings.
Cost/effort in collecting the data
There are a number of software applications that enable a free (or very cheap) analysis of search engine rankings (see References). So there is little if any cost/effort in collecting the ranking data. However, the cost comes when the strategy is focused on search engine optimisation (the process of improving the visibility of a website or a web page in search engines). For this an external consultant is typically required.
Target setting/benchmarks
Organisations should aim for a high ranking on the most dominant search engine. According to Net Marketshare, in December 2010 Google’s global market share was 84.65%, Yahoo was 6.69%, Baidu was 3.39%, Bing was 3.29% and others stood at 1.98%.
In the United States, Google held a 63.2% market share in May 2009, according to Nielsen NetRatings. In the People’s Republic of China, Baidu held a 61.6% market share for web search in July 2009.
So the target (and benchmark) should be a high ranking on the search engine with the most dominant national position.
Example
This example comes from www.SEbook.com (see References) for predicting an increase in online sales for each keyword. For example, say an organisation scored a Google website ranking of number one for a keyword that, according to the SEOBook.com Keyword Selector Tool (which provides a list of up to 15 of the most popular search queries for each word you enter), was searched on 100 times per day in Google. The site ranking number one would receive a Google CTR of approximately 40%. This would translate into 40 visits to the website each day (100 searches × 40% CTR = 40 visits), or 1,200 visits per month.
Now we will convert the 1,200 visits into dollars. For this we will assume that the website delivers the average 2–4% conversion rate (sales from visits). This means that the 1,200 visits should produce approximately 24 to 48 orders per month (1,200 unique visitors × 2–4% = 24 to 48). We will also assume that your average online order is approximately $50. Therefore, a single keyword with a Google website ranking of number one could drive between $1,200 and $2,400 of online sales for your business each month, or $14,400 to $28,800 annually.
Tips/warnings
It is important to remember how CTRs drop off precipitously after the number one position. This reinforces the need to keep your website ranked in Google’s (for example) top 10 (first page of search results) for the keywords that matter to your business. Otherwise, a large percentage of your customers and prospects will not find your website if Google has you ranked beyond its first page of search results.
Also, it is important to position current search engine rankings and click-through rates as part of a wider search engine optimisation strategy.
References
http://seotrainingproducts.com/blog-life/google-website-ranking
Stephen Woessner, The Small Business Owner’s Handbook to Search Engine Optimization: Increase Your Google Rankings, Double Your Site Traffic . . . in Just 15 Steps, Atlantic, 2009.
Net Marketshare: http://marketshare.hitslink.com/search-engine-market-share.aspx?qprid=4
For free applications for search engine rankings see www.gtms-inc.com/tip_websitemetricsguide.htm
For search engine optimisation consultants see www.seoconsultants.com/