21-year-old Wei Zexi, a Chinese college student, hit the news in April when he died from a rare form of cancer. It wasn’t his death that raised concern, but the form of treatment he was given in a Beijing hospital. He had sought help for his condition, searching for answers from China’s top search engine, Baidu. He chose an experimental treatment from a hospital which appeared at the top of a Baidu web search, mistaking the paid advertisement for an organic and informed search engine result. His death caused an outcry in China and a resulting investigation into the advertising practices of Baidu SEM.
Calls for Change from Baidu SEM
The regulators demanded that Baidu make several immediate changes which included a ban on non-approved government medical institutions from appearing in the Search Engine Results Page (SERPs). The Cyberspace Administration of China called for a complete overhaul and cleanup of the ranking system, so advertisers are featured by credibility rather than by the amount of money they have paid. They also asked for assurance that paid for promotions do not account for more than 30% of search engine results, and that paid promotions are clearly marked as such.
Baidu promptly responded and have made many significant changes already including the 30% advertising ratio. Another important change includes a limitation on the number of ads appearing on one page, now capped at four. Previously, it was 8 or 9 depending on the keywords, and if the companies could not win the bid for top 8 or 9 in Page 1, they could bid for top 8 or 9 in Page 2 and so on. Now, not only are the ads capped at 4, but these 4 ads are the same across all pages. This clearly shows how much competition there is for the featured slots, and demonstrates the significant benefits companies may get from improving organic traffic.
Other changes also include the elimination of advertising featured on the right-hand side and clear differentiation markers between organic and paid for search engine results.
The Impact on other Chinese Search Engines
360 Search and Sogou, two other major online Chinese search engines, also made changes to their operations after the outcry. 360 Search has ceased all consumer related medical service marketing on its search engine. Sogou has releases a new medical feature, Sogou Ming Medicine, to provide authoritative information and professional medical content. This leads users into their Sogou Ming Medical Channel, where they can find more accurate and professional medical content such as Wikipedia, Zhihu and content from academic journals.
This is a key period for these two search engines to boost their credibility in light of the Wei Zexi scandal, and secure a greater hold in the marketplace.
So what does this mean for Baidu SEM?
Firstly, there will be a significant increase in the Cost Per Click (CPC) for keywords. With the limitation of the number of ads featured, competition will be high, and only those with the biggest budgets will make the cut. Obviously, the ad performance will be greater for those who are in those top 4 spots.
Companies who do not win one of the top 4 spots will have to fight for their spot in the normal search engine rankings.
Those with weaker SEO will possibly not appear even within the first one or two results pages. This will have a huge effect on the importance of quality SEO links as organic SEO advertising will now be featured on the remaining two-thirds of the page.
Tips for Search Engine Marketers
The changes to Baidu advertising, and the follow-on changes to other Chinese search engines, have had an impact on the way search engine marketers need to operate. These tips will help bring the best search results under the new conditions.
1. Reassess your keywords
With limited ad space, competition on keywords will be fierce. There will be a fight for those top 4 spaces, and those in position 5 and below will need to weigh up the pros and cons of raising their bids. If they happen to be successful at winning one of the coveted top 4 spaces, marketers are going to pay much more in CPC terms than they ever have before.
More than ever, marketers will need to focus on keywords which are specific to their business sector in order to see real results for their money.
2. Look at mobile options
While these changes apply to both desktop and mobile searches, the display layout of mobile search result remain unchanged in terms of the number of featured slots per page, and different ads for featured slots across pages. Globally, mobile search figures are increasing, and Baidu is showing the same increase in terms of mobile users. Therefore, it may be in your company’s best interest to focus more on the mobile search market where it is still possible to achieve better results. Advertisers or digital marketers may be able to increase their mobile stronghold to better adapt to the change.
3. Widen the search engine net
Baidu may be popular in China, but it is not the only one. 360 Search and Sogou are gaining strength, especially since the incident, and search engine competition may be less on the second and third ranked popular engines. It may pay to widen the net and invest with more than one web-based search engine company at any given stage.
Diversification will be the way of the future and marketers need to take a good hard look at not only SEM but also SEO and Online Reputation Management (ORM).
It is going to take a bit of time before the dust settles in the wake of the Baidu SEM changes and, in all likelihood, further changes are still to come. It is up to you, as the marketer, to keep abreast of these changes and understand how it will affect your business in terms of your SEM and SEO efforts.