Generative AI is changing the landscape of online search. At the same time, evidence is emerging that Covid-19 lockdowns caused a fundamental shift in consumer behaviour, with shoppers acquiring a lasting preference for sourcing retail products online.
These trends have profound implications for retail companies, which will need to improve their profiles in online search in order to retain market share.
A permanent switch to online shopping is shown in a major study by Conductor, a leading SEO software company, which examined organic traffic to the websites of more than 1,000 major retail sites and found net increases in all parts of retail since mid-2021. Across the industry, there were seven quarters of consecutive traffic growth. “Even as lockdown restrictions were lifted, consumers continued to go online in greater and greater numbers,” the authors noted.
This behavioural change is so entrenched that even the traditional slowdown in the economic cycle and retail consumer activity between Q4 and Q1 appears to be a thing of the past. The study, SEO Benchmarks, showed a quarter-on-quarter uptick in organic traffic to retail sites in both Q1 2022 and Q1 2023.
As chief marketers respond to these trends, they must contend with a squeeze on their budgets in a challenging economic climate. The CMO survey for March 2023 found that 52% of marketing leaders reported that inflationary pressures were decreasing their levels of marketing spend. Less than 17% reported an increase.
Even a small change in a website’s standing across relevant keywords could have a significant impact on market share
According to the Conductor study, which compared the cost per click (CPC) of paid marketing with the cost of generating the same traffic organically, the strategic use of SEO will save the average retail company €6.6m per year. The savings in grocery retail were highest, at nearly €5m per quarter, due to intense competition driving up the price of keywords and CPC.
In sectors where keywords are expensive, Conductor recommends a switch in marketing strategy. “Shifting paid media budgets towards less expensive keywords can save money,” it says. “You can then acquire traffic for the competitive keywords with solid SEO.”
Amazon, more than any other company, recognises the power of strong SEO. The Conductor study analysed the top-10 Google rankings for thousands of transactional keywords and found that Amazon leads organic market share across every sector in retail. In apparel, Amazon enjoys a market share of 22%, while global brands such as Nike and Ralph Lauren control 2% and 1%, respectively. In sports and outdoor, Amazon has a 27% share, compared with eBay, which holds 2%, and ASOS, with 1%. And in office supplies, Amazon commands 25% of the market, compared with Office Depot at 7% and Staples at 6%.
Beyond Amazon, the fierce competition across retail creates ready opportunities for growth. “In most sectors, just a few percentage points separate the major players,” the study’s authors write. “This means that even a small change in a website’s standing across relevant keywords could have a significant impact on their market share.”
Achieving this change is the task of the SEO director. The Conductor study urges them not to ignore non-traditional competitors, such as media companies, who are taking organic market share. It stresses the need to create content that raises the company’s expertise, authoritativeness and trustworthiness (EAT) – all qualities Google’s search algorithm rewards. As search engines race to integrate generative AI, having content that meets the highest EAT standards becomes even more important. Now is the time to secure and maximise market share before real estate within the top-10 search results gets even more competitive.
SEO directors must make their case to the board. In a guide to reporting to the C-suite, Conductor urges SEO directors to avoid SEO jargon and to use the language and metrics of the executives they are addressing. Being “concise, credible, compelling and comparable” are the key components to an SEO report that will land with the C-suite, it argues.
The investment value of SEO is clear, especially in times of recession. “Compared to paid media, the customer-acquisition cost is low, and the ROI is high,” says the study. “If you are not at the top of the search results, your competitors are. Getting there and staying there is the key to long-term success.”
For more information on the value of SEO, visit conductor.com/academy/seo-reporting/
Generative AI is changing the landscape of online search. At the same time, evidence is emerging that Covid-19 lockdowns caused a fundamental shift in consumer behaviour, with shoppers acquiring a lasting preference for sourcing retail products online.
These trends have profound implications for retail companies, which will need to improve their profiles in online search in order to retain market share.
A permanent switch to online shopping is shown in a major study by Conductor, a leading SEO software company, which examined organic traffic to the websites of more than 1,000 major retail sites and found net increases in all parts of retail since mid-2021. Across the industry, there were seven quarters of consecutive traffic growth. “Even as lockdown restrictions were lifted, consumers continued to go online in greater and greater numbers,” the authors noted.
