Does Paid Search Cannibalize Organic Search Clicks?

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By David Felfoldi on August 21st, 2012

If your paid search campaign includes keywords also found well-ranking organically, you might be cannibalizing your organic search traffic. Cannibalization occurs when a user clicks on your sponsored ad instead of your organic one, causing you to pay for a click rather than receive a “free” one from organic search.

Google states that their research confirms that cannibalization doesn’t occur.

In what we call “Search Ads Pause Studies,” our group of researchers observed organic click volume in the absence of search ads. Then they built a statistical model to predict click volume for given levels of ad spend. This model generates estimates for the incremental clicks attributable to search ads or, in other words, the percentage of paid clicks that are not made up for by organic clicks when search ads are paused. On average, the incremental ad clicks (IAC) percentage across verticals is 89%. This means that a full 89% of the traffic generated by search ads is not replaced by organic clicks when ads are paused. This number was consistently high across verticals.

But our research without own clients indicates differently. And we can present it in a simple graph.

Cannibalization of Organic Search Clicks

Take a closer look at the graph above. In it, we reviewed the past 7 months search performance of a single, specific phrase to find the level of keyword cannibalization. The graph is pretty clear — when paid search was turned on, organic search traffic from that specific keyword decreased.

The most telling example is February 2012 — while it was the highest paid search month for the specific phrase, it was the lowest for organic. For the months before and after, when there is a decreased paid search spend, the organic performs better. Another telling example is July 2012 – paid search was at a 6 month low, but organic began an uptick.

What extent did paid search cannibalize organic?

The next question was — to what extent did paid search cannibalize organic? For this, we looked at organic traffic as a percentage of traffic by each month.

Here we see the inverse correlation in closer detail — when the percentage of traffic from paid search for the specific keyword is up — the months 5, 6, 8, 11 and 12 — the percentage of traffic from organic search for the specific keyphrase is down.

In other words, when you turn on the paid search ads, traffic from organic search drops. When you turn it off, traffic from organic search goes back up.

Should I Avoid Cannibalizing Organic Search with Paid Search Ads?

Our conclusion, however, was that while paid search may attract some of the clicks that may have originally gone towards organic, the months with the most keyword-sourced traffic are when paid and organic worked in conjunction.

Historically, the organic search keyphrase drove about 4-5% of total traffic. During periods of paid ads, that keyphrase now drove 10-11% of total traffic. This is what Google meant by “a full 89% of the traffic generated by search ads is not replaced by organic clicks when ads are paused” — while paid search does cannibalize some organic traffic, it also attracts and drives clicks that might never had occurred without it. It’s more of a symbiotic relationship, than predatory one.

Your results, however, may differ. If you have an ecommerce site, check out this great sources on paid search cannibalization. By looking at your average sales price, you can calculate and decide if your level of organic search cannibalization from paid search is worth it.