Pro Marketer, Carl Brabander, on the state of SEM in Canada

May 15, 2007

The IAB says that the average percentage of spend for a Canadian company on Search Engine Marketing (SEM) activities accounts for around 33% of their online marketing budget, while a recent report from Emarketer shows that the USA is around 44% and the UK is well over 55%. I recently spoke with Pro Marketer, Carl Brabander (see BIO below), about why he thinks this is?

The Brits vs. the North Americans:

It’s cultural. The British marketers are more scientific than their North American counterparts. While we’re busy letting our agencies talk us into rich media and flash animations, the Brits are looking at the numbers and making tactical decisions based on predictive modelling and ROI calculations.

Companies that have crunched the numbers and looked at SEM vs. other Online Channels are shifting more into SEM, simply because it is more profitable. There are great tools out there for tracking and optimising paid search campaigns, but companies that rely on a traditional agency to book their online media probably don’t have the information or tool they need to make that decision, and the client then gets sold on the idea of spending big bucks to “build the brand” on the web, just like they do offline.

Of course a strong brand is essential to your success on the web – and the proof is that for the big guys like Citibank or Fairmont Hotels, their company names probably drive more search traffic for them than generic terms like “mortgage rates” or “Hotel Montreal Deal”. But these guys use TV and print to build demand for their brands, and that’s the hard part. Paid Search or SEM is relatively easy and cost-effective if it is used to havest the demand.

The Canadians vs. the Americans:

The difference here has to do with the cost of media in our countries. Canadian banner real estate has always been more expensive. On the other hand, more competitors bidding for keywords in the USA are driving up the cost of Paid Search Results. So, for the exact same media plan, a Canadian Marketer will spend relatively more on Banner Ads and less on SEM efforts as keyword buys are relatively cheap and will ultimately eat-up a smaller portion of the overall budget.

About Carl Brabander (The Bio)

Carl is a professional marketing strategist with a decade of internet, mass, and direct marketing experience. He is currently embedded in the insurance industry, driving campaign strategy and website architecture for a Canadian market leader. In his spare time, Carl plays in a band, squanders money on Ebay impulse purchases, and blogs under a fake name in an effort to overthrow a corrupt small-town mayor.

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