In a recent survey, we discovered that around 42.5% of people recognise a paid online advert when seeing them alongside organic results - read the full results by clicking here. It also showed that despite 65.5% of respondents being likely to click on a Google Ad, out of those who are aware of the paid ads only a small minority will actively click on them.
Users get frustrated at Google Ads for displaying paid advertising or products, yet seldom acknowledge that supermarkets are doing the same thing without highlighting to shoppers which positions on shelves are paid positions and which aren't.
Our research suggests that younger people are more likely to be aware of ads in Google search and intentionally avoid clicking on them. For some, this is not completely surprising. People under the age of 35 have grown up with access to the internet and social media on their smartphones, tablets and laptops and this connectivity has given them other options when it comes to deciding whether to buy something. The younger generation is also aware of the ins and outs of the web, including advertising methods, which makes them more aware of paid ads. Advertising industry research concludes that this generation will go to friends on social media or independent online reviews before buying something and they are much less likely to respond to ‘push advertising’ like PPC. They don’t like feeling pushed into things.
If we take a look at the retail sector traditional advertising seems to be thriving yet supermarkets, for example, are not that different from search engines in the off-line world of selling consumable goods. They provide us with convenient access to a wide variety of products and we trust our favourites. They have to decide which of the 1000s of products they are going to place in their retail space – and which of these should be featured in the most prominent positions – just like search engines do.
And guess what – they sell these prominent positions to suppliers in the same way that search engines sell to their advertisers.
Supermarkets don’t just make money on the small margin between buying and selling goods. In reality, a large proportion of revenue comes directly from suppliers who pay to get their products featured in-store and in the best spot.
British retailers don’t publish how much of their revenue is generated from what they call ‘commercial income’ but industry specialists estimate the top four supermarket chains makeover £5bn a year direct from selling promotional opportunities to suppliers.
Comparing this to our survey results, do 42.5% of people who visit a supermarket store know they are being sold to by paying advertisers? And if they did, would a large proportion simply refuse to buy because of this? If an 18 – 34-year-old walked past an end of aisle display and saw a bottle of wine on offer would over 80% decide not to buy it simply because the supplier had paid to put it there? What percentage of people know that suppliers can pay supermarkets listing or placement fees to get their products placed in the best buying positions on any of the aisle shelves?
We suspect that the percentage of those who would be unwilling to purchase these products in a supermarket simply because a supplier paid to put them there would be considerably less than those who are unwilling to respond to paid advertising online.
There are two main differences at play between online and in-store shopping:
1 – Supermarkets don’t tell us when a promotional position has been bought
A Google search for an e-commerce query like ‘buy wine’ gives us 4 top of pages ads from wine retailers marked with the green Ad button. And 9 Google shopping ads marked with the ‘sponsored’ text in the top right corner.
While 70% of the page is taken up by paid advertising at least we are told what it is. Supermarkets are under no obligation to mark their advertising so we can assume that a majority of shoppers won't recognise paid advertising when they see it.
2 – The consumer gets a tangible benefit
You don’t hear many complaints from consumers about supermarkets making money from their advertising practices. So why do a high percentage of people not like search engines making money for placing adverts?
Our theory is that in the supermarket's people unconsciously know they are also benefiting from the arrangement in some way. Either financially, if the promotions are discount based, or personally – for example saving time and effort in searching down the aisle for a relevant product. Most PPC ads are simply not good at picking up on and promoting the benefit to the consumer. They are too generic, untargeted and often look rushed.
So how can online advertisers use this information to their advantage?
It is imperative that the content of your advertising is relevant to the search – carefully targeted by keyword and demographic – and that the benefit is well thought out and clearly stated. Each ad needs time and effort invested in it.
So to look at an example, refining our wine search to ‘top quality wine for sale’ produces the following results:
None of the paid advertising is particularly relevant or enticing. The Rude Wines advert is the only one that mentions the ‘quality’ aspect of the search. It is then rather vague so doesn’t merit a click. It does, however, include the added benefit of mentioning a January sale underneath.
A PPC ad could secure a click from this searcher (in this case a 35+ female) by including information on how the wines are selected for quality, a review or grade by an expert wine taster for kudos, a money back guarantee for reassurance and free delivery for click bait. The landing page then needs to be specifically for this ad and immediately reiterate and expand on the benefits and offers the searcher has just shown an interest in.
To compete with retailers online ads should be well targeted to the intended audience and should entice users. There is an element of trust here also, users are sceptical of paid advertising, so companies need to ensure they are offering products and services that genuinely appeal to users and offer a good deal for consumers.
For more advice on how to create paid search advertising that works, please contact the experts at AdPilot today