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Did Google Hike my Insurance Costs?

I think that we all knew that Google was really, in revenue terms, a media company (they derive 97% of their revenue from advertising), but there's some fascinating new data about this in some new research from Wordstream. Kudos to them, they took their own database of keywords and ran them through Google's own Keyword Tool over a period of 90 days. Then, they organised the data into keyword themes so that we can find out which sectors are advertising on Google and from whom they make their money. The data seems to be biased towards the US, but it's fascinating nevertheless.

Where do Google make their money?

Answer: Financial Services

Occupying top spot with nearly a quarter of the top keywords and a top cost per click of nearly $55 bucks is the Insurance industry. Then it's Loans – 12.8% and $44.28 – and mortgages racking up 9% of the keywords at a top CPC rate of $47.12. Also in the top ten list were Credit and Trading.

Adding up the number of searches and the cost per click, Wordstream estimate that getting on for three quarters of the revenue comes from finance associated keywords. This Is something I found surprising at first sight –especially when you consider that the top shopping keywords – according to the BRC Google report showing that the top retail related search term was boots.

Think about it a bit more though and maybe it's simply the commoditised nature of finance, the fact that customers are buying only on price that means that they're so favoured as categories. But the amount of money is crazy.

Truly crazy.

Are Google Ad costs inflating the price of our car insurance? We're told that the reason premiums are rising is all the fault of rapacious lawyers (Attorney is the 4th most popular keyword group) making frivolous personal injury claims, but could Google also be having an impact?

I know that the Wordstream data is about top CPC costs and this will clearly distort things, so let's guess that on average the companies pay about half the Wordstream figure or $27 (GBP 16). I very much doubt that they would convert 10% of clicks into sales, but even at that rate they would pay $270 (£160) for each new online policy. That seems a helluva price to me. No wonder, insurance premiums are going up.

There are also some poignant things in the data too – who would have believed that "Cord Blood" would be in the list? But it is, at number 20.

For the retailer, the answer is that you can certainly afford to advertise with Adwords. It's a key way of getting customers to your site, but don't pay $55 bucks for a click, leave that to the titans of Finance, they've obviously got money to burn!

Google's most expensive keywords source:Wordstream
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