I like looking at marketing models; after all, we are SE Marketers. In addition, I find applying traditional marketing models to online marketing isn’t all that hard, and makes for better reading by management who know nothing about search marketing. Simultaneously, the process inspires a unique insight into one’s strategies.
This time around, I decided to look into the BCG Matrix.
Although popularly know as the Boston Consulting Group Matrix, the actual name of this well-known marketing theory is the Growth Share Matrix or the Product Portfolio (visit the original publication).
For those who don’t know of the BCGM, here’s a VERY simple version:
The BCGM is used for those businesses that have more than one product in their portfolio. It is used to determine what priorities should be given to products. The theory stipulates that to maintain long-term value, a product portfolio should include base level products that are entering the market and need support, and established products that are profitable earners.
It analyses two dimensions: market share versus market growth. The bigger the market share or the faster the market growth, the better it is.
The BCG Matrix places products into four distinct categories:
- Stars – high growth rate and high market share
- Cash Cows – low growth rate and high market share
- Question Marks – high growth rate but low market share
- Dogs – low growth rate and low market share
The below illustrates how the BCG Matrix relates to each of the above:
Why is it useful for an SEM?
This system may not be useful to all SEMs. But I have kept in mind that a large number of us, including those who specialise in making money via affiliate schemes, AdSense etc, have more than one site. Also, it’s easy to see the aggregate data and sit back and say “I am doing well,” when actually you may be spending 2 hours a week on a potential dog instead of your question mark. And sometimes we spread ourselves too thin and often tend not to be sure where to plot our resources.
Hence, the BCG Matrix for SEMs (note: these are the metrics I consider most important to me – but you can plot any two key metric you prefer to make decisions):
- A Star: Site with high growth of traffic, and high revenue
- A Cash Cow: Site with low growth of traffic, but high revenue
- A Question Mark: Site with high traffic but low revenue
- A Dog: Site with low traffic and low revenue.
Assuming that I own four sites that fit in with each one of the categories, I would ask the following conclusions:
Dog: Do I need to archive this site instead of wasting my resources? Should I add its content to one of the other sites like the cash cow or star and 301 all its present results? Very important to make this decision.
Question Mark: I get a lot of visits, but the revenue isn’t just coming through – am I promoting the right products? Maybe my monetising scheme isn’t right for the site? What other model can I turn to? Do I want loads of traffic that doesn’t convert? Very important to carry out an analysis of monetisation models.
Cash Cow: This is my old reliable – but can I increase traffic to it? Will more traffic mean more revenue? Or should I let it plod along and finance my other schemes? Very important to keep an eye on – so as to make sure that results don’t start slipping.
Star: How can I use this site’s success to push up my other sites? What am I doing right that the site is doing so well? Great to make learning decisions.
The above example gives you an idea of what sort of questions and decisions can be highlighted by the use of the BCG matrix. Note: it’s not limited to just four sites – you can plot within that space every site you have and if there are hundreds, regard them as clusters.
I do hope that this has been useful for you. If you only have one site and would like to use a traditional marketing model, try using the SEO SWOT analysis.
