SEO – Lesson One

In February 2006, BMW.de, the official website of the automotive giant, ended up on Google’s “blacklist.” BMW, as they later admitted, was using so-called “doorway pages”. In short, these are pages where the owners earn by publishing dynamically generated links aimed at increasing the PageRank of those who pay for such a service. Soon, BMW.de ceased to exist for Google, at least in terms of search results.

Five years later, JC Penney, a retail chain with over 1,100 stores across the US and Puerto Rico and annual revenue of nearly $18 billion, experienced a similar situation. However, they weren’t caught by Google but by the New York Times, which then informed Google. Just a few days later, JC Penney ranked first in search results if you searched directly for their company name. But for all other searches, JC Penney was nowhere to be found on Google (and probably Bing too).

What happened? JC Penney had paid for SEO services. The company that handled their SEO promised and delivered excellent results. From Halloween to the end of January, during the Christmas and New Year holidays, JC Penney was the top web destination for several hundred keywords related to shopping, according to the New York Times. 34% of Google users click on the first search result.

There are 37.2 million searches per month with the keyword “dress” on Google. The estimated average cost per click (CPC) for the keyword “dress” is $0.58, and advertising on Google brings an estimated 11,483 clicks per day, or $6,746.75 in dollars (according to Google AdWords Traffic Estimator).

These are estimates based on a 12-month average. The numbers during the holiday shopping frenzy are significantly higher.

Now for some math: If 34% of 37 million users visit your website, and let’s say only 1% of them spend just $10, and let’s assume this applies to a hundred keywords, plus if you’re number 1 on Google, there’s no need to pay for an advertising campaign, so you save a daily amount of $6,746.75 per keyword.

The calculation shows that you directly and indirectly generate revenue of nearly $150 million for the company in just two months through SEO alone. This is my pessimistic math. It’s probably ten times more. But to quote a New York Times journalist, “Only JC Penney knows.”

The company that did SEO for JC Penney did the same thing as in the BMW story: They bought a bunch of links to JC Penney’s website. It’s not illegal. But it would have been better for JC Penney if it were – they would have paid a million dollar fine and said goodbye. Google’s penalty is much bigger.

But of course, JC Penney are not foolish. They knew very well what awaited them if they were caught. The New York Times article also mentions their financial results and shareholders’ expectations. For them, it was simple math, and in the end, they were rubbing their hands together.

However, this story is the answer to the question that clients most often ask: “How can I be first on Google?” In the following conversation, they all explain how they heard about buying links and how it speeds up the whole process… But this story is not a lesson for clients. Their calculation, in this case, is clear, just like with JC Penney.