Dotster is one of the original domain registration services providers. Today, the company is still committed to its core service but has also expanded into site design, hosting and several other Web 2.0 services. Until the first of this year, the company allocated about 4% of its overall marketing budget to search engine marketing, buying placement for about 10,000 words on Google, Yahoo and MSN, said Marci Hansen, Dotster's marketing director. It tracked its spend via a small, third-party search engine marketing company, but there was a problem: The search metrics it provided Dotster weren't real-time.

"We were working with them once a week. They'd give us a report ,but it didn't consider how much growth was available to us," she said.

Dotster switched providers, signing a deal with search engine marketing company SendTec, based in St. Petersburg, Fla. The biggest change, Hansen said, was that SendTec was providing real-time tracking in the form of a dozen reports, so the company could make changes on the fly and see what was working and what wasn't.

International Adds Dimension

These reports came in handy, Hansen said, when earlier this year Dotster expanded its domain registration service to include international extensions such as .es, the extension that designates URLs originating in Spain, and .de, Germany's Web extension. In the case of .es, Dotster purchased placement on Yahoo.es and started tracking how most new customers were coming into the Dotster site. Results were interesting, she said.

"The recently added .es extension is the extension for Spain, but we saw that it's being used in the U.S. as a language differentiator," she said. In other words, companies inside the U.S. are purchasing the .es extension to create Spanish-language versions of their American sites for use here.

"Before SendTec, we weren't doing almost any international search engine placement, but we had such a nice little jump and what we did exceeded our initial expectations," Hansen said. "We ended up seeing a 30% to 40% increase in .es extensions being ordered."

There have been many other metrics that affected the company's SEM campaigns. For example, recently Dotster started making changes to its own site based on metrics from SendTec, SendTec President Erik Obeck said.

"One of the issues we picked up on soon after taking over Dotster's SEM account is that there were some keywords that were linking to dead pages," he said. Dotster was able to make changes immediately, he said, which helped improve the ROI of the campaign.

Increased results, SEM budget

Because of its recent success with SEM, Dotster has increased its search budget to account for more than 10% of its overall marketing budget, with more growth expected this fall, when the company will launch a TV campaign.

In the meantime, paid optimization has also affected the company's organic search, Hansen said.

"We're spending more on search, and as a result we've seen natural click-throughs go up as well," she said. "Natural search and paid results go up hand in hand."