Altertbox: Search engines as “leeches”

Search Engines as Leeches on the Web (Jakob Nielsen’s Alertbox)

Interesting and combative Alertbox above, arguing that in an ‘arm’s race’ with competitors to improve the levels of acquisition from search, the only winners are the search companies. His argument is nicely illustrated, but it’s simply saying what we know: in a goldrush the best money is to be made from selling shovels rather than prospecting one individual claim.

The real learning here is:

non-search users become the true source of added value from website improvements

ie customer acquisition may be at a cost (loss leader, investment, call it what you will) while customer retention (ie subsequent “free” sales) make you the profit over the customer’s lifetime.

This is a good illustration of the usual retention and relationship marketing arguments, however it misses two worrying points:

1) too many customers never return. They don’t want to return. They didn’t even know who you were. These are the “one night stands” of acquisition. Take the discount/promotion and run. No breakfast. No commitment. No calls.
2) too many customers think that the search enging is the shop. Even “on brand” customers will enter your business’ name into google – it’s as if they can’t be bothered to bookmark your site or enter your own URL directly. Much as the old portals were the ‘windows on the web’ so the search engines are the launchpads for shopping. When I see staff at work entering our own brand names into google rather than having a bookmark I despair!

The challenges to retailers are therefore to:
* make a profit on every sale
* make each product page a web site
* differentiate between ‘customers’ (who have a relationship with you) and ‘purchasers’ (who don’t, and do not wish to have).

Villifying the search engines is like chastising farmers for making hay while the sun shines…