Travelocity bets ad budget on brand search

Brand names function better as search marketing keywords than non-branded terms, according to a study conducted by online travel agency Travelocity.

The company found that only 4% of its bookings came from ads bought on un-branded search terms, suggesting Travelocity’s own brand name is responsible for 96% of its business.

Chief marketing officer Jeffrey Glueck told Advertising Age:

“For us, we can take a loss on nonbranded terms like ‘Hawaii vacation’ — but not much of a loss. [It is a] profound mistake by all of us to think we’ve figured out how to measure ROI on search. We’re in stage one.”

If the rule can be extrapolated across the industry, it would mean marketers at an anti-perspirant maker should purchase ads for “lynx” but not for “deodorant”, “anti-perspirant” or even “bowchickawowow”.

Glueck cites a 360i study that found marketers spend just 5% of their ad spend on brand name search ads – but that they drive 80% of their search marketing profit.