Paid Search Advertising connects an advertiser to a consumer who is actively looking online for their product or service. It’s effective, affordable, and scalable so it should be in every Destination Marketing Organizations (DMO’s) marketing toolbox. Search Advertising Benchmarks let you determine how a search campaign is performing relative to industry standards.

Search Engine Ads

Search engine ads are placed based on Keyword Selection, the words or phrases that a consumer uses as search criteria.  There basically are three types of ads and three ways to pay.

Types of Search Ads

  1. Traditional PPC ads that appear at the top of a search query above the organic listings.
  2. Shopping Ads that can contain photos, product names, price and Brand name.
  3. Google local Service Ads which are solely for service businesses.

Payment Types

  1. Pay each time an ad is clicked on. (Pay Per Click or PPC)
  2. Pay whenever an ad is displayed. (Cost Per Thousand Impressions CPM)
  3. Pay when a phone call is generated

Paid Search Advertising Benchmarks

To maintain a competitive edge, advertisers need to understand how their Paid Search strategies are performing relative to their industry averages. Wordstream partnered with LOCALiQ to compile benchmark data for the top 20 industries using Google and Bing search ads.

The Metrics to Track:

  • Average Cost per click
  • Average Click-through rate
  • Average Cost per lead
  • Average Conversion rate

Average Cost Per Click

Fortunately for DMO’s the travel industry average cost per click is one of the lowest at $1.40 as you can see from the chart above and legal services are the highest at $8.67.  The average cost across all 20 industries is $3.53.  Cost is determined by how competitive a keyword is in an industry category, the target audience, location, and other factors.

Average Click-through Rate

Here you can see that travel has one of the highest click-through rates at 8.54%.  That figure and the low cost per click for travel is a winning combination.  Click-through rate metrics can help you determine whether the targeting, ad copy and offer are working or need adjustment. But these two metrics don’t tell the whole story and need to be looked at in relationship all four benchmarks.

Average Cost Per Lead

Cost per lead is wear the rubber meets the road in Paid Search Advertising.  This metric measures how much you spent to turn a click to your website into action; request a visitor’s guide, buy something, fill out a form or make a call.  The average here is $41.40 with a range of $14.88 to $73.70.  The travel industry is just below the average for this metric at $37.34.

Average Conversion Rate

Cost Per Lead tells you how much and Conversion Rate tells you how many.  The percentage of people who clicked on an ad that actually took action.  The average here across all 20 industries is 8.82% with a high of 19.19% and a low of 3.25%.  Travel comes in just below average at 6.01%.

Bottom Line

Paid Search Advertising works but there are a lot of moving parts behind a successful campaign.  Benchmarks provides insightful data to track performance relative to your industry, gauge effectiveness, and make on-going adjustments to maximize ROI.  At MediaOne we have experts that take our Destination Marketing Partners Paid Search campaigns to the next level.

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