Ending The Paid vs. Organic Search Debate

12pm, Wednesday afternoon. Hugo, a second-generation business owner, sat quietly, staring across the large antique desk at me with steel gray eyes that complemented his distinguished salt and pepper hair. He frowned and said, "I think I'm beginning to understand this Internet thing!"

I raised my eyebrows at him.

"I used to buy ads in the popular magazines to reach my target market, but all that's changed. Now we spend money on all sorts of things—search engines, Adwords, social media, and on and on..."

"My marketing team keeps pushing me for more and more money, so I started reading about Organic and Paid search, keeping in mind that our sales cycle isn't immediate, sometimes it takes a month or two between a quote and receiving the order."

Hugo leaned forward, "This is what I want to know: I understand that Organic is the middle results, and Paid is at the top, or down the side - so, how many Leads, Quotes, and Sales are the result of my Organic and Paid positions?"

"In other words," I said. "Business is good, but you want to know what marketing spend is generating the leads, quotes, and sales, so you can make marketing decisions based on the value generated."

"Spend more, to make more money!"

Hugo smiled. "We can always use more business."

"So, are you able to help me?"

"Yes," I said, smiling back at him.

This was just the kind of case I was hoping for! A case of missing marketing data. Let's investigate.

The case file:

For a case like this we needed more than Google Analytics to tie leads, quotes and sales back to their original sources. To get a complete picture we needed call tracking and feedback from Hugo's marketing team. (Luckily, this is included in the WhatConverts package.) After installing the WhatConverts script and getting feedback from Hugo's team, I sat back and waited for the data to roll in...

Here are the facts:

The first weeks' data is always the most exciting, and would give us indications, but a month would give us a more complete picture. So we'll continue to monitor results over 2 to 3 months and report back. Let's take a look at what we found:

Evidence - Month 1

The first month looks healthy; $738,198 in quoted value for 173 total leads, but only 53 of the leads were quotable. In the chart below we'll break down whether the leads were organic search or paid search.

Investigation:

Search vs Organic Leads

Search/Organic is winning so far with 109 Leads, compared to 26 leads from the Search/Paid campaign. Organic has 4.19 times more leads than paid!

We then asked Hugo's marketing team to mark the Leads as Quotable (Yes/No).

Search vs Organic Quotable

Organic's advantage decreased when looking at only quotable leads. Using this new data, we found out that the organic search received 2.5 times more leads than paid (28 vs. 11).

As the quote value is added to each of the quotable leads; we can then calculate the total quote value by source.

Search vs Organic Quote Value

Hold on a minute! Organic leads had a total quoted value of $139,751.58, but paid quoted value was $142,025.25. That means even though organic search had 2.5 times the amount of leads over paid search, the paid search leads were worth more in quoted value.

Case Results:

I sat across from Hugo, and took a sip of coffee. "This is really good!"

Hugo replied, "It's Kenyan Peaberry; I like it freshly ground. So, what do you have for me?"

I said, "Hugo, we have great news. The data has been eye opening! As you know you were only seeing how many leads were being generated by organic or paid search. Also you weren't tracking leads through phone calls. Not only were you missing leads, you had no idea of the value of each lead."

"Is that so!" Hugo said.

I continued, "Thanks to WhatConverts, we've captured all the leads and can now see which leads are quotable, what that quote value is, and also the sales value, so we know the value of each traffic source. Based on month one, organic search is generating a higher quantity of leads, but paid search is generating a higher total quoted value."

"Really? So, my marketing team may be correct. That's great," Hugo said. "But, what about sales?"

"The answer is simple," I said. "You said your sales cycle can take more than a month at times, and so far, $27,724 in sales have been made from $738,198 in quoted value."

"We'll dig deeper into the actual sales made by organic and paid search in our next installment," I continued. "We should see stronger sales, but I'm curious to see if paid search will keep its value lead..."

Case In Progress: With initial data, paid and organic have generated similar quote values.

Hugo's second month's numbers haven't come in yet; it might take a little while. In the meantime check out the next case, Eliminating Reasonable Doubt On AdWords ROI.

Michael Cooney
Michael Cooney

Michael Cooney is a co-founder of WhatConverts. He’s been solving everyday marketing mysteries for years! Connect with him on Twitter or via email at michael@whatconverts.com.

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