I’ve created the following sample excel sheet for those of you concerned with click cannibalization between organic and paid search. This is an ideal tool if you already have a high PageRank for a given keyword and still want to drive more traffic to your website, but are concerned with your pay-per-click (PPC) campaigns stealing clicks from your high organic ranking.
While some say you should never run a PPC campaign when already ranking high, others say that driving more traffic to your site is always the best strategy. This excel sheet will help you put this argument to rest.
In our example, your company already ranks high for a given keyword but wants to know what it takes to drive more traffic to your site. However, you want to make sure that you’re not stealing your clicks from organic searches. So, how do you go about determining the net benefit of paid search when you already rank high? Better yet, how do you determine whether click cannibalization is an issue?
First Month: Organic Search Only
First, we start by summarizing the first month with organic search alone, which in our example is 5000 clicks for January. Second, we input our website conversion rate, which is the number of website visitors derived from the 5000 clicks that end up placing orders. In this case, it’s 1.75%.
The third step defines the number of actual orders for the month, which is simply 5000 multiplied by 1.75%, which gives us 87.50 orders for July. We then enter our value for each sale as $25.00. Finally, the total sales for January are simply 87.50 multiplied by the $25.00 which gives us $2,187.50.
Again, several people would be apprehensive about pursuing paid search when already ranking high. These are the people who think you should build on that high ranking across multiple other keywords. However, the internet currently has well over 4.8 billion live web pages and it's growing daily. That's a lot of competition in organic search - so advertising is a must.
Second Month: Organic Search and Paid Search
In the second month, you decide to combine organic search with a pay-per-click (PPC) campaign. Now, click cannibalization is guaranteed to occur. However, your job is to define whether there is an added benefit of running a PPC campaign in conjunction with your existing high ranking.
First, you input the number of clicks generated through organic search. Right away you notice the decline as organic search only generated 4250 clicks, a decrease of 750 clicks. Second, you input the number of clicks generated through your campaigns, which in our example is 3250.
The total of both organic and paid search equals 7,500 clicks. So, we have 2500 more clicks in February than we did in January. The question that remains is whether there is a net benefit to having a higher number of clicks relative to the costs to get those clicks.
Next, we add our cost per click for the campaigns we ran which is $0.15/click. The website conversion rate remains 1.75%. However, our sales have increased to 131.25 orders as we are now multiplying our conversion rate of 1.75% against the 7,500 clicks.
We then add our value for each sale as $25.00 and then multiply this $25.00 by 131.25 clicks which is $3,281.125. So, we increased our revenue, but was the decision to run a PPC campaign when already ranking high worth it?
The only way to answer this aforementioned question is to take the difference in revenue between February and January and then deduct the cost of the PPC campaign. So, we generated an additional $1,093.75 in February and spent $487.50 on paid search. The net benefit is $606.25. Therefore, while click cannibalization occurred, it was still a good idea to pursue paid search when already ranking high.
Steps to Using Excel Sheet: All the light blue highlighted areas need you to input values. The rest of the excel sheet will perform all of the calculations.
- Input number of organic clicks (first month)
- Input website conversion rate
- Input sales value
- Input organic clicks (second month)
- Input number of clicks from PPC campaigns (Paid Search)
- Input PPC costs (per click)
- Input website conversion rate
- Input sales value
When I work with a customer looking to grow their online presence, I tend to stick to some fundamentals. First, I am not a search engine optimization (SEO) expert because I am not entirely certain that there is such a thing. After all, nobody knows Google’s algorithm but Google. There are things we’ve learned over the years, but for the most part, it’s a secret sauce and will remain as such. However, despite this, the most important approach is to do the proper keyword research and ensure those keywords are used within your content and PPC campaigns.
Second, I adopt a simple strategy of getting my customers to focus on a strong social media platform, one matched to their business model, their market, and their customers. B2C is for Facebook, but LinkedIn is for B2B. Try not to confuse the two.
Third, I think it’s always best to focus on solid content creation. Produce well-written content and do your own videos. Finally, if you want to combine your current high PageRank with a PPC campaign, then make sure you use the attached excel sheet to determine the benefit of paid search when you already rank high. Driving more traffic to your website is always a good thing if the additional revenue generated is higher than the cost of the paid search.
Here is the excel sheet: Download Click Cannibalization Versus Organic Clicks Sample Excel Sheet
