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In a recent article posted online about Apple iPhone ad texts, it’s clear that monitoring and modifying your campaigns is crucially important because of the ever-changing competitive landscape.  You no longer have the luxury of waiting days or weeks to respond to competitive pressure – that certainly was the case with print advertising some years ago – as in real estate, you need to move quickly.  In this post I’ll discuss the types of competition out there, and how they affect your campaigns.

Due to the competitive and evolutionary landscape that is search marketing, no one can really claim to be an expert in SEO, or SEM.  Even Search Engineers themselves can’t necessarily tell you definitively what will work and what won’t work in terms of SEO or SEM because concepts, competing advertisers, search algorithms, and user queries can change rapidly.

As an online marketer, understanding the competitive landscape and choosing your battles can be critical in maintaining your mental health (and pocketbook).  You’ll need to be aware of the types of competitors out there cutting into your “click share”.

Direct Competitors

This one should be straightforward, your direct competitors advertise nearly an identical value proposition to your own.  Sure, their widgets may include neat stickers and fancy paint jobs, but most of the functionally significant specifications will be the same.  Depending on your industry and its acceptance of online marketing as a viable advertising vehicle, search results pages may already be saturated with direct competitors.

How to compete:  Target their weaknesses by flaunting your superior features or business differentiators.  If they’re offering 2GB MP3 players on sale, one up them with a 4GB MP3 player on sale.

Affiliates

This is the web’s answer to your traditional product or service reseller.   Most affiliates will serve ads that call out the comparison shopper, offer some kind of value-added proposition, whether it’s simply additional information to make the purchasing decision easier, or perhaps offering cash-back for signing up through the affiliate’s site banners.

How to compete:  Depending on your business model, you may not want to.  Consider your true cost of acquisition and compare that to the cost of motivating an online affiliate to sell your company for you.  If affiliates are hocking your direct competitors’ products or services and knocking you down the SERPs, something must be working for them.  On the other hand, if you have the budget to bid higher on your “bread and butter” keywords, it might not make fiscal sense for affiliates to compete.  The old adage, “if you can’t beat them, join them” certainly holds true for most.

Search Engines

I call, FOUL!  It’s sad but true, most search engines will compete with you for the same advertising space.  If you think about it, this would be the prime scenario for a class action lawsuit by direct competitors in the same boat, but I have yet to see this happen.  When search engines compete with advertisers within their own ad space, they are playing dirty.

As far as I’m concerned, Google, Yahoo, and Microsoft have no right competing on their own ad space (or even competing search engine ad space) as their own customers.  But don’t be surprised to see it happen – even in the most peculiar of SERPs.

How to compete:  You can’t.  Search engines are fully aware of their secret sauce, know what you’re bidding, know how much traffic you get, and have a good idea of how to dominate each and every nook and cranny you’ve worked hard to discover.  The only way they will back off is if you call them on it.