Does the Buying Funnel Apply to Online Search?

9:02 am in Marketing Nirvana, PPC Marketing Blog by brad

I find there are three types of PPC practitioners:

Part-timers. These individuals run accounts part-time and don’t test a lot or know all of the best practices. They usually learn from seminars or the best practice people.

Best Practice People: This group might only run accounts part time, but they have the education to understand what the overall best practices are. They might not follow them all (the time vs possibility battle), but they have a solid grasp of PPC.  This group learns from the testers.

Testers. They understand the best practices but don’t assume they all apply to them. They try to test everything possible and don’t make assumptions to other people’s data. They use other case studies and testers as sounding boards for items to test themselves.

There is another group of people who are not practitioners, but understand PPC from a completely different angle: the researchers.

The Researchers often work for universities, PEW, and even the search engines. Their goal is not just to test the data; but to analyze it using the classical methods of:

  • Creating hypothesis
  • Formulate an analysis plan
  • Gathering the data
  • Analyzing the results

This group often does not make any assumptions, the empirical evidence is what matters. Once they are finished with a test, then they write a paper on the hypothesis, tests, data, and their analysis.

This is often a forgotten group for most PPC practitioners.

Researchers Research – They Don’t Make Assumptions

Most marketers are very familiar with the buying funnel (also called the sales funnel, the sales cycle, the decision making cycle, the buying funnel, etc). Same overall concept, different names and variations.

Most marketers also assume this concept applies to search. Why not? It’s a well thought out proven model of customer behavior.

This is why the researchers are so valuable. They don’t make this assumptions.

One of my favorite researchers is Jim Jansen. He’s an associate professor at Penn State, he’s worked with PEW, and has published a myriad of papers. He likes to focus on paid search.

He recently wrote a research paper (which means there’s actual research here and not just testing) that analyzed if the buying funnel actually applies to paid search.

Does the Buying Funnel Apply to Online Search?

In their study, they made 6 hypothesis about paid search and the buying funnel:

  • Hypothesis 01: There will be a significant difference among queries in each stage of the buying funnel based on average number of impressions.
  • Hypothesis 02: There will be a significant difference among queries in each stage of the buying funnel based on average number of clicks.
  • Hypothesis 03: There will be a significant difference among queries in each stage of the buying funnel based on average cost per click.
  • Hypothesis 04: There will be a significant difference among queries in each stage of the buying funnel based on average sales revenue per query.
  • Hypothesis 05: There will be a significant difference among queries in each stage of the buying funnel based on average number of orders.
  • Hypothesis 06: There will be a significant difference among queries in each stage of the buying funnel based on average number of items ordered.

When you look at the hypothesis, you would assume that most of the answers are ‘yes’. Which overall is correct.

However, when you look at they hypothesis and guess at which stage of the buying cycle you would see the most data you might not be correct.

In the first hypothesis, the average number of impressions was highest at the top of the funnel – the awareness stage – which makes sense.

In the last hypothesis, the average number of items ordered was also highest at the top of the funnel – the awareness stage. That one surprised me.

In fact there were a couple of these hypothesis that were a bit surprising.

Would you like to hear all of the results?

Jim Jansen Makes an Appearance on Marketing Nirvana

In cast you missed it, we launched a radio show a few months ago called Marketing Nirvana. The show is also available on iTunes, or you can subscribe to the Marketing Nirvana group to receive updates.

In the show airing Monday April 4th at 9am PST / Noon EST Jim and I walk through some of the research, examine each hypothesis, and give some practical tips for how you can not just take advantage of the best practice people or the testers – but also get information directly from the actual researchers.

If you would like to read the paper we’re discussing, you can find it here (Note: PDF File).

We hope to see you on Monday. When the show is available on iTunes we will also post it in the Marketing Nirvana Group.

If you have ideas for Marketing Nirvana shows, or would like to write for Certified Knowledge. Please let us know.


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