http://adage.com/digital/article?article_id=121437
Study Finds Large Audience Online for Package-Goods Brands
By Jack Neff
Published: October 23, 2007
BATAVIA, Ohio (AdAge.com) -- Research released today by ComScore defies long-cherished beliefs that people don't care enough about package-goods products to do online search about them or go to their websites.
According to ComScore, people who visited package-goods sites via search rather than other means tended to be higher income, better educated, more female and bigger category spenders.
The study found a majority of U.S. consumers visited at least one package-goods website during the three months ended in April, with search driving a substantial proportion of those visits.
Food, baby-care sites Food product sites drew 93.7 million visitors collectively during the three-month period, 47% of them coming from search, according to ComScore. Baby-care sites got an even bigger proportion of their 26 million unique visitors from search at 60%.
Collectively, those audiences are huge -- bigger certainly than the vast majority of TV programs or print media plans for most package-goods marketers. Those 26 million visitors to baby-care sites compare to only 20 million children under 5 years old as counted by the 2000 U.S. Census, indicating some grandparents, expectant moms or baby-shower shoppers may be swelling the ranks, too.
Ironically, the data would seem to indicate that search, along with brand websites, could be the mass-reach vehicle package-goods marketers have found lacking since media began fragmenting in the 1970s.
"Search really can be thought of as a reach vehicle, and even more powerfully, reaching people who clearly are engaging with your product," said James Lamberti, a former Clorox Co. executive who's now senior VP-media for ComScore.
Under-spend in category Yet the surprising traffic comes despite the fact package-goods marketers continue to under-spend many other industries online, with most industry marketers, including study participant Procter & Gamble Co., spending low-single-digit percentages of their measured-media outlays on the internet, according to TNS Media Intelligence data for the first half of 2007. P&G spent 2.1% of its $1.6 billion outlay online, up from 1.4% a year ago.
The measured data doesn't include search, but research firm Jupiter estimates search currently accounts for less than 20% of overall package-goods online media spending.
Even so, P&G, whose partners in the study include Yahoo and the Search Engine Marketing Professionals Organization, sees the data as a sign of the power of search marketing.
"I think there's this mentality that 'This is package goods. Sure they're going to use search for a car or a mortgage, but they're not using it for deodorant or skin care,'" Mr. Lamberti said. "But in fact they do."
"P&G wants to increase our spending on the marketing elements that have the best return on investment for us," said Randy Peterson, search innovation manager for P&G. "It's increasingly looking like search is a good way to spend marketing dollars. Is it a panacea for us? No."
One of the most interesting aspects of the study, he said, was the extent to which it showed people are using search to find information in their daily lives.
"It started in the technical world, moved to books, DVDs and travel," he said. "Now people are realizing, 'I can even look up information about coffee and laundry detergent online.' It's become a natural way people use to get information of all kinds."
Of particular interest, Mr. Peterson said, was that searchers who came to package-goods sites were much more category-involved and bigger spenders (by 20%) than non-searchers. "That tells us something about how we should spend our marketing dollars," he said.
Gaps in search buysBut the study also found huge gaps in search coverage by major brands on key terms in their categories. Even though ComScore's survey of online searchers found 71% expect to see major brands come up in the results when they do a search. For example, searches on the term "anti-aging" returned nothing in the top organic or paid listings for the biggest media spender and leading brand in the segment, P&G's Olay. But Johnson & Johnson rival Neutrogena has bought the top paid listing on Google and Yahoo.
Lack of significant paid search by most major brands is a key reason why only 2% to 3% of clicks for package-goods-related searches go to paid listings, compared to 12% to 13% overall for search, Mr. Lamberti said.
Among other surprises in the research, coupons and promotions play less of a role in driving traffic to package-goods sites than he expected. Only 40% of searchers and 47% of non-searchers said they went to brand sites to seek promotional deals, compared to 73% and 58% respectively who went there seeking information and help.
Overall, people who visited package-goods sites via search rather than other means tended to be higher income, better educated, more female and bigger category spenders, also underlying the relative value of search advertising, Mr. Lamberti said.
Matt Wilburn, senior category director for Yahoo on package goods, does see a trickle of movement of industry marketers toward search, which he believes could turn into more of a flood within a few years.
"As we've gone into planning meetings with clients for '08, search consistently is being asked for," he said. "CPG companies tend to be like battleships. They're slow to make big turns."
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