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What is Internal Ad Competition?

by Mark Walls February 06, 2018

If you own or run a business in this digital day and age, chances are, you use online advertisements to promote your products. With the rise of smartphones, tablets, and other devices, the best way to reach your prospective customers is increasingly via screen. According to Statista, “with the penetration of the Internet and increasing popularity of digital platforms, digital advertising has grown to become one of the most important forms of advertising. Digital advertising revenue worldwide is forecast to increase at a fast pace in the coming years.” This exponential expansion is a financial fact: companies spent $170 billion on digital advertising in 2015 and $204 billion in 2017. In 2021, Statista expects this number to skyrocket to a stunning $330 billion.

In a booming market, online advertising is powerful and effective. However, as you probably already realize, it’s also highly competitive. As companies jockey for the top spot on search engines, the price for ads seems to rise by the minute. In all likelihood, your business has been beset by increasing online advertising costs. It’s easy to feel trapped by upward-climbing ad expenses, so you keep shelling out more and more just to maintain the same results. It’s all because rival businesses are snatching up the same search spots, right? Wrong.

Especially if you run a larger enterprise, you’re likely actually hampering your own ads because the components of your company simply aren’t coordinated. Various branches of your business are unknowingly competing with each other, driving up costs for all involved. Fortunately, Site Rank Systems has made it our mission to help you uncover and resolve this pervasive promotional problem. In the following blog, we explain what internal ad competition is and how we can help you eliminate it.

Internal Ad Competition 101

As you may know, when you put an ad up on a search engine, you tailor it to certain keywords or key phrases. These are the things potential customers might type in when searching for your services. By tying your ads to these keywords, you can attract the attention of those who are likely already interested in what your business offers. For example, if you own a dog grooming company, you might pay for an advertisement to appear when a user types in the phrase “poodle shampoo near me.” Of course, there could be other companies trying to target the same keywords. Perhaps a dog grooming competitor in your area also wants to shampoo all the local poodles. This is external competition, and it can certainly surge the cost of your ad.

External ad competition is to be expected, but internal ad competition is much more insidious. This occurs when multiple tiers of the one business separately vy for the same keywords. For example, if Doggone Dog Grooming was a national chain of canine salons, the national

marketing team, southwestern regional office, and individual Phoenix salon might all target ads to “poodle shampoo Phoenix.” Without realizing it, they would all be bidding against each other, inflating the cost of every online ad. Even when one tier “won” and momentarily secured the top spot on the search engine, this would simply mean the other two “lost,” pushed further down the page. All three offices would spend more than necessary for lower conversions, shooting themselves in the proverbial foot (or paw, as it were). This is how internal ad competition impairs your promotional efforts at every level.

What Not To Do About Internal Ad Competition

Without understanding the nuanced dynamics of internal ad competition, many businesses struggle with online advertisements. You may notice your promotions aren’t performing quite as well as they should, but be unable to pinpoint why.

In these cases, some businesses attempt to contact the search engines themselves for help. Unfortunately, this is not a wise course of action. Since search engines make billions off of online advertisements (and they profit even more when internal competition raises prices), asking a search engine for help with underperforming ads is akin to asking a lawyer how to use fewer billable hours or requesting that a personal trainer teach you how to work out by yourself. Search engines have no incentive to help businesses resolve these problems.

Similarly, just pouring more money into marketing efforts for each individual tier of your business without synchronizing your ad spend only exacerbates the issue. The more fiercely each segment of your company competes, the worse for your venture as a whole. This is a vicious cycle, and one that far too many enterprises encounter. If your online advertisements appear to be in a dwindling spiral, it could be because you’re improperly addressing internal ad competition.

The SRS Solution

We don’t want you to supplicate search engines for assistance or waste even more money on relatively fruitless ads. Site Rank Systems’ sophisticated team serves as an independent partner, here to help you identify internal ad competition, formulate cross-tier protocols to remedy it, ensure these are executed properly, and optimize your operations on the whole.

Since we have no vested interest in your ad spend, you can trust our team to keep your business’s best interests in mind, maximizing your efficiency and effectiveness at every turn.

Are You Suffering From Internal Ad Competition?

If your multi-tier company’s online advertisements aren’t yielding the way they should, this is all but certainly the case. Find out with SRS’s Free Internal Competition Analysis and contact us today to schedule a consultation.

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