a chart to describe the search engine market

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Significance of search engines

     The significance of search engines on the internet is analogous to that of operating systems for computers. The inception of search engine technology began with the creation of ARCHIE [1] by Alan Emtage in 1990. Today, search engines have evolved as the most crucial business application on the internet due to its enormous potential to provide highly targeted consumer traffic to business to consumer (B2C) websites. From a marketing perspective it is more affective for an online business to be listed in the first three pages of search engine results than any other form of online marketing.

Few observations that highlight the relevance of search engines are:

  1. 84.8% of internet users find websites through search engines [2]
  2. 81.7% of internet users read only the first three pages of search results [3]
  3. 87.2% of internet users use their favorite search engines to launch their queries [3]

These observations are based on surveys conducted by Graphic, Visualization and Usability center at Georgia Institute of Technology (, iProspect (, webSurveyor (, Stratagem Research ( and Survey Sampling International.  ( They emphasize key aspects in the behavior of internet users with regard to search engines:

  1. 1.       Dependability on search engines
  2. 2.      Trust in search engine results
  3. 3.           Loyalty to search engines

     Search engines have thus become a gateway to gain targeted visitors so much so that search engine optimization and search engine marketing have become the focal point of internet marketing.

Statement of Problem

     As more and more web pages are appended to the Internet, there is a constant need for any B2C merchant to stand out among competitors in order to attract more and more consumers. Since an online merchant has to face increasing competition everyday, the most effective strategy to maximize exposure is by achieving top rankings in search engine results. Search engines have psychological relevance against any other channel of online advertising. The search engine user is looking for desirable information. There is no better time to present a product or service to a search engine user more than when one is looking for it. This psychological factor binding search engine provides a high return on investment [ROI]. This study attempts to identify various techniques to improve ranking of a website in search engine results.

Purpose of Study

     Search engine relevancy algorithms are proprietary. Due to the mysterious nature of search engine relevancy algorithms, the process of achieving higher rankings in organic search engine results cannot be determined using a mathematical or mechanical model. Different search engines use different factors to determine relevancy of a webpage with respect to a search query. Search engine technology is in its evolving phase; hence search engine companies are constantly classifying various techniques that improve ranking of a web site in search engine results as spam. Though major search engine companies do specify what they consider as spam, many of the minute technical details cannot be ascertained by reviewing these specifications. A website is penalized if identified as a spamming website. As a consequence, the website may be assigned a lower ranking or even removed from the index. The purpose of this study is to identify techniques which may improve the ranking of a website in organic search engine results, specify spamming strategies which should be avoided and introduce search engine marketing paying close attention to publisher and competitor malpractices.

Research Conducted

     Search engine optimization strategies are based on assumptions which are verified using trial and error. There is no literature on the subject which can claim that following a set model can result in a certain ranking in the results of a specific search engine. The research work for this study was conducted by reviewing relevant literature and applying these techniques to derive a refined process which can be incorporated into the software development stages of a website project.

The research conducted enabled the author to gain more exposure to the relevancy algorithms of Google (, Yahoo! Search ( and MSN Search ( [Chapter II: Search Engines]. A search engine optimization process has been outlined by the author in Chapter III. This process classifies different optimization schemes into techniques that may be applied to individual web pages and the entire website. Search engine spamming strategies have been listed in Chapter IV. These strategies are identified by major search engines as spam and should be restrained to avoid penalty. Chapters V focuses on bid jamming and click fraud which has become prevalent in search engine marketing industry and increases awareness regarding these malpractices.

Limitations of Study

     This study serves as a guideline to search engine optimization and search engine marketing. The inferences derived in Chapter II, Chapter III, Chapter IV, Chapter V and Chapter VI are based on independent research and data gathering. Due to the proprietary nature of search engine relevancy algorithms, the process outlined may not incorporate all possible optimization and spamming techniques. This manuscript specifies guidelines pertaining to these techniques which are valid as of October 2005. As search engine technology evolves, many of the specified optimization techniques may be rendered as spam by search engine companies. The study should be used to enhance knowledge relative to the subject so that the reader can identify and concentrate on specific optimization techniques.

Internet Marketing Terms

     Before one considers the potential of search engines as a marketing tool, one should become acquainted with internet marketing. Internet marketing like any other marketing is based on the basic principle of marketing – Make a sale to the consumer.

The key terms associated with internet marketing are:

  1. Visitor: Internet users who visit a website
  2. Targeted visitor: Visitors to a website who are interested in what the site has to offer
  3. Publisher: Any individual/organization that offers advertising space on the site
  4. Advertiser: Any individual/organization interested in buying advertising space on websites
  5. Affiliate: A website that provides internet traffic to another website in return for a commission in sales
  6. URL: Uniform resource locator is the global address of documents and other resources located on the internet
  7. CTR: Click through rate is the number of clicks divided by the total number of impressions of the  advertisement over a period of time
  8. Above the fold: The portion of the webpage that is viewable in a browser without scrolling
  9. Affinity Marketing: Marketing strategies based on established buying patterns
  10. Click Tracking: The process of tracking and auditing visitors referred by the publisher’s website to the advertiser’s website. This is done by setting a cookie on the visitor’s browser that records the publisher, the link and the payment rates

Internet advertising pricing models

     At the lowest level, internet marketing can be classified into three pricing models. They are CPM – Cost per milli, CPC – Cost per click, and CPA – Cost per acquisition. These models are behaviors exhibited by visitors on the publisher’s website.

  1. CPM or Cost per milli is the cost per 1000 impressions of advertisement displayed on the publisher’s website
  2. CPC or Cost per click is the cost paid by the advertiser when a visitor to the publisher’s website clicks on the advertisement and arrives at the advertiser’s website irrespective of the impressions displayed. The psychology being that the visitor is interested in visiting the advertiser’s website and hence the act of clicking on the advertisement. These visitors are targeted visitors
    1. CPA or Cost per acquisition is generally a commission paid by the advertiser for behavior on the advertiser’s website by a targeted visitor resulting in an action desired by the advertiser. This is a direct marketing model and takes different forms, most popular of which are:
    2. CPL or Cost per lead pays a flat fee for obtaining a consumer lead, such as signing up for a newsletter program
    3. CPS or Cost per sale pays a commission based on a transaction made by the consumer, such as a purchase

    Figure 2:  State diagram – Internet Marketing

    A comparison between the three pricing models from the advertiser’s viewpoint leads to the conclusion that CPM is least effective and CPL is most effective. The reason being the occurrence of a successful transaction on the advertiser’s website is independent of the number of times a URL is displayed on the publisher’s website. For a publisher, it may seem that CPM is the highest return on advertising space. On the contrary, CPM pays lower than both CPC and CPL over a significant period of time.

    Table 1: Rates of various pricing models

    Table 1 illustrates the rates paid by various advertisers and real time statistics of In May 2005, displayed 22,522 impressions of Google Adsense content ( With a payout rate US$ 0.09 per 1000 impressions, the earnings for CPM would have been (22,522 / 1000) * 0.09 = US$ 2.02. Instead, made US$ 7.82 in CPC earnings with a click through rate of 0.5% (112 clicks). Assuming that participated in CPS program and referred 5 successful transactions out of 112 referrals each of US$ 8.99, then CPS earnings would have been (8.99 * 5) * 0.3 = US$ 13.48. The assumed referral rate is (5 / 22,522)*100 = 0.02%. The above statistics makes a practical comparison between CPM, CPC and CPA programs and indicates that CPA has a tendency to generate higher profits for the publisher.

    Online advertisement media formats

    Figure 3: Media formats

    All pricing models use the similar media formats for advertisements. The cost paid by the advertiser depends on the following factors:

    1. File size
    2. Dimensions of the media
    3. Location on the publisher’s webpage; e.g. Above the fold
    4. Nature; e.g. Static, Dynamic, Movie, Talking media

    The different types of media formats used in internet marketing are discussed below:

    Window Formats

    1. Pop-Ups are generally 720×300 px windows which automatically open on top of the primary browser window. This can be annoying to the visitor if the content is not relevant to the visitor’s interest.
    2. Pop-Unders are generally 720×300 px windows which automatically open under the primary browser window without distracting the focus of the internet user from the primary window.
    3. Interstitials are 728×600 px web pages launched between two pages which the visitor is navigating. This page opens within the primary browser window, thus capturing the full attention of the user.
    4. InVues (250×250 px) slide into the center of the primary browser window after the main webpage loads completely. This is a modified version of the pop-up window but less intrusive.

    In-Page formats

    Table 2: In-Page advertisement formats

    Roadmap to forthcoming chapters

         Chapter II: Search Engines provides background information related to search engines, directories, relationship between search engines, search engine user trends, PageRank algorithm, TrustRank algorithm and overlap analysis of popular search engine results. Chapter III: Search engine optimization focuses on improving web page rankings in search results by fine tuning contents of the web page. Chapter IV: Search engine spam points out factors to avoid while improving ranking in search engine results. Chapter V: Search engine marketing gives a brief overview of Pay per click search engine marketing. Chapter VI: Conclusion and Recommendation summarizes the guidelines discussed in the study

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