As little as 5% (five percent!) of Google paid-search ads produce a click-through.

Gian Fulgoni, Chairman
comScore

If the chairman of a major Internet tracking firm like comScore tosses out a statistic like that in front of search conference attendees, then there is little point in comparing Google’s pay-per-click ratios to, say, Yahoo or Microsoft Live Search or Ask.

Fulgoni had his reasons. He wants to yank online marketers away from their “obsession” with direct-marketing measures of success … what Fulgoni called “The Last Click.” Instead, comScore’s chief wants to look at the ignored value of over 80% of search advertising: Latent online and offline results.

In other words: Branding effects of paid-ad search marketing.

This isn’t simply an interesting argument for e-commerce entrepreneurs, who try to improve ROI, hold onto profit margins and maybe survive an economic downturn. In fact, the most consistent tip offered by merchandise sellers who survived every national and regional economic bust in the past 20 years is this: Keep marketing your business brand and image. When the going gets tough, the remaining wholesale, retail and consumer dollars go to trusted brands. No one trusts a brand that hides.

So, what does branding babble have to do with hardworking online buyers and sellers? Here’s what:

1. Because search advertising is still a direct-response medium — measured by click-throughs pulled to your site and, then, converted to sale, purchase order or request for quote — that doesn’t mean paid search has no branding value. Brand value is becoming more important.

2. The bad news is that online buyers and consumers do not separate search ads with a Call to Action from search ads that reinforce business brand awareness or reputation (whether for quality merchandise, on-time delivery, no-hassle refunds).

That’s also the good news. Every search result that lists the business or product name, every display ad button or skyscraper ad on a trade industry web page that features a brand (even if it goes un-clicked that time), every appearance of your brand name has an effect. It may not show up until next time or offline … in a retail store, at a trade show, in a trade publication.

This is called latency; latent results are still results that bring in revenue.

3. Whether the response from a buyer is immediate and direct, or whether it’s latent and time-delayed, brand awareness is bankable, as “trusted” supplier for “brand loyal” customers.

4. Last, according to comScore chair Fulgoni, only 1/3 of online ad spending goes to building brand. But that was last Spring, before the economy went to the top of concern charts. And the forecast is for integration anyway – better measurement of branding results from search advertising and less emphasis on CTR as the be-all and end-all of search advertising.