Progress over time: The law of diminishing returns?

I haven't posted for a little while. Partly this is a result of other activities keeping me busy partly reflecting about the graphs below.

Essentially, I think all our optimisation efforts are hitting a point of diminishing returns.

Graph 1 below shows the percentage of traffic generated from a range of sources over the last 12 months. Amongst other things it shows a useful reduction in reliance on pay per click advertising and people knowing about the site and entering the name directly (probably mostly staff). It also shows that over time search engines are now bringing in 60% of all traffic while directories and other related sites are bringing in a lesser proportion of visitors (although in absolute terms the numbers are up).

Graph 2 shows relative performance against a baseline of 12 months ago ie today our traffic numbers and total pages visited is nearly 60% more than a year ago. This is quite an improvement. Total visitors and pages viewed track closely as over time the number of pages viewed per unique visitor has not changed significantly. Unfortunately the other trend that can be observed from the graph is that the rate of improvement is slowing down - we are getting less improvements from our incremental effort.

Perhaps we are reaching the point where incremental effort is not justified. Overall ranking on search engines etc is improving as is shown by the relative improvement in traffic generated. There is still more work that can be done there but perhaps a fundamental shift to our approach is required to lift performance to another level. Have you experienced this phenomenon with your web optimisation effort? What did you do to break out of these limits?

More businesses advertising online than in print

Yet another indication of how industries can be transformed by technology comes from the US where the Kelsey Group reports there are now more small and medium businesses in the US advertising online than in traditional media.

Specifically 77% of US businesses use online advertising in August 2009 compared to 69% using traditional media. Last year the figures were about even.

However, the spending profile is different. Business is still putting more of their budget towards traditional media (nearly two thirds) although during the last year the share of online has increased from 22% to 37%.

That is a significant growth in an environment when overall advertising spending is down. ie while business cut back advertising they invested more in online. Perhaps this was largely driven by better proof points around return on investment or alternatively the relatively small amount of money needed to reach a wider audience.

In Australia these figures are likely to be much lower although the same trend over time is likely to apply. Business already spends $1.8bn advertising online.

Free Medical Website creation services

Dr Colin Mendelsohn has published an article on free websites and directory listings in Australian Doctor (Aug 25) titled Free & Easy on free websites and directory listings.

These include:

• Your Health - www.yourhealth.net.au. Which provides a free website when you sign up for their practice newsletter service.
• MyDr - www.mydr.com.au. Which provides a free website but links back to CMPMedica's medical information and advertising funded website.
• FamilyGP - www.familygp.com.au. Sponsored by MS&D.

Australian Doctor also publishes an interesting articleon 26 August titled WebPresence.com which quotes the cost of a website at between $3000-$10,000 so a free service can certainly save money.

The key of course is to carefully evaluate the benefits and shortcomings of any approach, the budget within which you are operating and what you are trying to achieve.