Optify conducts empirical research with own and third party databases and Optify Labs is an experimental playground where new ideas are tested before integrating them into their product. In that way, the company managed to become a leading provider of marketing software and services for the Real Time Web.

A few years ago, AOL leaked their search volumes and SEO aficionados created one of the first Click Through Rate (CTR) curves. Those curves have been used thoroughly in the SEO industry as a cornerstone for ROI calculators and theoretical debates, and as a means to justify SEO efforts.

However, these CTR curves are now outdated. Given recent changes in the way search engines render the Search Engine Results Pages (SERPs) and the increasing importance of social in search, the people at Optify thought it was time for a new CTR curve and to answer a few basic questions. For doing this,  250 sites were randomly chosen as the sample set for this research, from which over 10,000 keywords were analyzed.

The three main questions Optify intended to find answers for were:

• Given the recent changes to SERPs, what is the new CTR curve for organic results?

• Is there a correlation between organic click through rate and CPC value for the same keyword?

• What is the effect of search volume on click through rates?

Optify came to the following answers and conclusions:

1. Ranking is important only as a mean to predict CTR

While you should always aspire to rank higher, real value comes from business results, not rank. The first set of results supports the old claim: ranking on the first page is far more valuable than ranking anywhere else. These results clearly show that with an average 37% click through rate, the benefit of ranking number one is very valuable, and with 60% of the clicks going to the top three, ranking at the top of the first page is more valuable than ever.

Unlike the old AOL data, ranking first on the second page has some benefits; there’s a slight bump for position eleven (the first result for page two) over the last position on page one (position ten). The implication of these results is that working to move keywords up within page one can yield accelerating benefits.

A quick ROI analysis would indicate, if you double your investment to move from the second position to the first, you could triple your visits for that keyword. Given the volatile nature of SERPs, especially in the last few months, your exact position on a page is less predictable than the page you’re going to rank on. For that reason, Optify looked at the average CTR on page one versus the average CTR on page two and found that the average CTR on page one is 8.9%, far higher than the 1.5% CTR average on the second page, emphasizing even further how important the first page is compared to any other page and position.

This means your SEO efforts should be focused on moving keywords to the first page and not necessarily to the first position. It also means that ranking below page two is good only for tracking and looking at trends, but has almost no business value.

2. There is a negative correlation between CTR on organic results and CPC value of sponsored results; as CPC value goes up, you can expect to get less clicks on the organic results.

To test the effects of the CPC value of a keyword on its CTR, Optify compared “expensive” CPC terms, over $1.50 CPC on AdWords, to “cheap” CPC terms to those under $0.25 CPC. The graph on the right shows that expensive CPC terms see a lower organic CTR than cheap CPC terms.

Optify found out further that cheap CPC terms will likely see over 30% CTR on position one, while expensive CPC terms will see less than 20% CTR on position one. The graph on the right elaborates further on the implications of these results; cheap CPC terms will likely yield over double the CTR on the first page than expensive CPC terms.

In other terms, given two keywords with the same search volume one being a cheap keyword, and one being an expensive keyword, your potential organic traffic is nearly three times greater on a lower CPC term.

The flipside of this analysis is that if you’re bidding on expensive CPC terms, you’re probably getting your money’s worth; Google’s business is advertising and our purely organic search analysis indicates Google’s doing a great job of acquiring clicks on ads over organic links.

3. Search volume affects CTR

Long tail terms (less than 100 monthly searches) yield higher overall CTR on the first Search Engine Result Page (SERP), while head terms (more than 1000 monthly searches) yield higher CTR on the first results, but lower average CTR on the first SERP.

To show the difference in CTR between keywords with different search volumes, Optify compared head terms to long tail terms and defined head terms as keywords with over 1,000 monthly searches (Google US) and long tail terms as keywords with less than 100 monthly searches (Google US).

While head terms yield higher CTR for position one (32% for head terms versus 25% for long tail), long tail terms show better overall CTR on page one (4.6% average CTR for head terms versus 9% average CTR for long tail terms), according to Optify.

The immediate implication of these results is that if you’re optimizing for head terms, you will not see huge benefits until you get to the top few positions. If you are optimizing for a long tail term, you can see decent CTR almost anywhere on the first page and there is less incremental benefit of moving up in search results.

With that said, from a share volume perspective, first page rank for a head term will probably yield more visitors than first position for long tail term.

What does this mean for you?

1. Daily tracking and measuring your keyword rank is important, but it’s definitely not enough. There are numerous SEO tools and services that will illuminate your rank for all your keywords, compare them to your competitors, research them across multiple search engines and even show you how they trend over time. Although, as long as you can’t tie these results to business results (i.e. revenue), you’re just guessing.

2. Ranking for the first position, or at least on the first page, is still more valuable than anywhere else.

3. Invest in getting more terms to page one first, then worry about advancing to first position.

4. Choose your target keywords wisely and make sure you look at the CPC value as well as the search volume.

5. If you’re interested in more than just visits and page views, measure success with the right metrics. If your goals are leads, sales or signed customers, make sure you have the mechanism to track and measure those metrics all the way from source to completion.

6. Getting a lot of long tail keywords to page one might be easier and more valuable than getting a few head terms to page one; it all depends on your goals and strategy.

7. Stay informed about SEO best practices and updates. The changing face of SERPs is not a short-term fad. As long as there are search engines, SERPs will continue to change.

The results described in Optify‘s white paper, emphasize the importance of ranking on the first page of Google. Furthermore, they show how ranking first on page one can yield accelerating benefits equivalent to tripling the number of organic visits from second position to first.

Since rank and search volume are not business results but mere Key Performance Indicators (KPIs) for most businesses, Optify focused their analysis on visits from organic search. Even though it is not a business performance metric either, they presumed it was the best KPI measurement of the bunch because of its common usage across all types of businesses.

The results clearly show that in order to truly measure your success, rank and search volume are not enough. Since the CTR for a number one position isn’t the same for long tail as it is for head terms, or for “expensive” CPC terms as it is for “cheap” CPC terms, the only way to truly measure your success is business results. Whether those are page views, visitors, leads, customers or even sales, visits are easily transferable to those metrics. (Source: www.optify.net)

By Anjum Siddiqi