To some extent, I think search engine marketing (SEM) has become mainstream (dare I say it’s “jumped the shark”?). Everyone obviously appreciates the need to show up in Google via natural search results and it’s come to the point where most everyone understands the same need for paid search. Of course, with the masses comes the ignorance.
I’ve come to the conclusion that SEM is a lot like Twitter; some of the people with the highest expectations for it simply do not understand it. Some SEM managers lack analytical skills and, potentially as a result, fail to understand search in the macro sense. These managers (the one who implement hairy target goals or test without a control) often fail to recognize the direct impact that engines and competitors can have on a search campaign’s performance.
First example; brand terms. There is nothing stopping a competitor from making the strategic decision to bid on your brand terms – and there is nothing you can do about it. Period.
Second, the “long tail” as we know it today (as terms ignored by competitors) is going to dissolve. As companies incorporate SEM into their marketing strategies, and as engines refine their relevancy algorithms, SEM is increasingly becoming a zero-sum game. As the search-industry grew, companies were able to gain share using the “long tail”, or areas without much supply or demand. Increasingly, however, these areas are becoming fewer and further between.
There are a finite number of words in the English language which means there are also a finite number of search queries. At some point, which may be now, all competitors will accurately bid on every relevant term. When this happens, and all other things being equal (i.e. Quality Score), we will have a perfect supply & demand auction system. This means it’s a zero-sum game: Every potential paid search click will be captured by an advertiser, whether or not it is you is to be determined.
All engines seemed somewhat concerned with storage space (ex. I’ve never seen benefit from the “delete terms with zero impressions in 90 days” theory that engines have claimed as a best practice). Combined with the release of Microsoft’s Bing and Google’s Wave I think we’ll start to see a change of concepts in SEM, perhaps a shift to themes rather than words. Google already has “themes” for content and Bing & Wave seem more focused around personalized search which could weigh the search query string with less emphasis.
If it’s true that the current search tools are fully utilized then this change in concept and the increase of personalization is greatly needed to allow SEM analysts to further capture the most valuable searchers. Without this change the gap between feasibility and perception of potential value will only further broaden.