SEO is a
long-term "Blue Chip" investment. It requires a lot of hard work and effort, and the results come
slowly over time, but they are
long-lasting and generally of very
high quality. SEM (Search Engine Marketing), or "Paid Ads", is a better-understood channel, especially in China, but when economic times are tough, SEM results can start to falter, and this is when SEO can often save the day. We have been doing search engine optimization since the very beginning because we have seen that it works in the good and bad times, and it helps us build long-term and fruitful relationships with our customers.
In the current global economic downturn, SEO is more important than ever, especially in China, which is feeling the effects for the first time in its history. Historically China has always focussed on SEM but in the last two years, Paid Ads have become less and less effective, so much so that even Google is worried.
In 2022, Google announced a decline in Ad Revenue growth from 69% in 2021 to 11% (
Google posts major Ad Revenue Slowdown - CNN). As a result, companies are looking for alternatives: TikTok, Metaverse, and 3D Ads. However, many fail to see how valuable, stable, effective, and important SEO is as a channel for exporting goods and contacting buyers.
SEM, SEO, and the Economy
Every channel has its advantages and disadvantages, and it is always a good idea to have multiple channels, ideally all leading to the same destination, your
independent web. SEM is highly effective (high conversion rates) when the economy is booming and money flows. However, SEM conversion rates and, as a result, the
Return On Investment (ROI), drop considerably during difficult economic times. SEO has high conversion rates in both the "good" times and the "bad" times, making it the channel of choice when there is a slump in the economy.
![SEM, SEO and the World Economy]( "SEM, SEO and the World Economy")
[image based on data from macrotrends.net]
Before the 2008 crash, with the boom in the
housing market in Europe and the USA, the ROI for SEM was excellent. Demand far exceeded supply; the more you invested, the more traffic and contacts you received. However, this SEM ROI collapsed in the post-2008 crash years, as did the
Google Stock Price.
This turned the focus to SEO, as now it was the ONLY channel generating the B2C sales and the B2B leads. Businesses were closing, and employees were being laid off. BUT thanks to SEO, many businesses survived. From that day on, ALL those businesses had a new respect for SEO traffic and realized just how important SEO really is.
For the first time, the current economic slowdown has directly affected China. For the first time, China is experiencing a drop in ROI with "Paid Ads" in Google and across all marketing channels.
![SEO Saves the Day]( "SEO Saves the Day")
[image based on data from macrotrends.net]
However, the
GOOD NEWS is that China is also beginning to realize just how important SEO is in these times. Better still, once this economic downturn has been reversed, the customers will have gained new knowledge and increased respect for just how important SEO is to their core business.
When the "good" times return, the ROI for SEM will also return, and the Google Share Price will rise.
Everyone will be happy, but everyone will remember how
SEO is important in the good times, and especially in the "bad" times.
If you would like to know more about SEO and how EC Center might be able to help you, don't hesitate to get in touch with us.
