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Somaxon's PPC Advertising Blitz on Google for Silenor

|Includes: Somaxon Pharmaceuticals, Inc. (SOMX)

September 7th, 2010 was the official commercial launch of Silenor; a sleep maintenance treatment by Somaxon Pharmaceuticals. Currently Somaxon has a co-promotion agreement with Procter & Gamble. However, I’m going to briefing discuss the current advertising being done by Somaxon.

This past two weeks Somaxon has upped the ante and started a massive online advertising blitz from what I can tell. There haven’t been any official details from Somaxon, however with a little due diligence I was able to “sniff out some information”. Apparently Somaxon is using Google Adwords to get the name Silenor in front of every possible person suffering from insomnia. In case you didn’t know Google Adwords is Google’s advertising platform allowing companies to advertise their products or services in Google Search Results.

Now, virtually any search phrase or search keyword related to insomnia has Somaxon’s ad for Silenor; in fact they are usually the first ad to appear meaning they are bidding top dollar to be on top. Below I’m going to review a few numbers for some keywords to help you get an idea of how many people are seeing these ads and the probable rate people are actually clicking on them to learn more.

The tools used to make the numbers and data below are the “Google Adwords Keyword Tool” and the “Google Adwords Traffic Estimator”. Note, these tools are maintained by Google so they will provide the MOST EFFECTIVE and ACCURATE numbers available for the data below. I’ve only used two keywords with the most relevant traffic since it would take weeks to provide data for every single keyword Somaxon is bidding on.

Keyword: Insomnia

  • Monthly Search Volume: 40,500 per month
  • Estimated Traffic: 17-21 per day
  • Details: This is a broad keyword directly related to insomnia and receives around 40,500 U.S. searches per month. According to Google Adwords Traffic Estimator if you are bidding the number one spot you’ll receive 17 to 21 visitors per day.
Keyword: Sleeping Pills
  • Monthly Search Volume: 8,100 per month
  • Estimate Traffic: 12-16 per day
  • Details: In my opinion this is a vital keyword to bid on and with the low amount of monthly searches it still has an excellent conversion rate of 12 to 16 visitors per day.
Now, to the average investor with little to no knowledge on Google Adwords and PPC advertising the above to keywords don’t show much potential. Both together only would bring 37 visitors at the most per day to the Silenor website. However, Somaxon is bidding on hundreds of keywords and with the above tools you can find related insomnia keywords and simply Google Search them to see if Somaxon is bidding on them.

Let’s throw some numbers around and assume Somaxon is bidding on 150 keywords and each keyword on average brings 7 visitors per day. That means 1,050 people “per day” will learn about Silenor; and these are people actively searching via Google for information on insomnia. It’s safe to say that all the money they aren’t spending on TV commercial ads is being wisely used via internet advertising on Google, Yahoo! & Bing.

Most investors have been talking about the value of the Proctor and Gamble co-promotion being aimed at doctors and healthcare providers. Little do they know that the PPC advertising blitz by Somaxon is going to get Silenor in front of everyone suffering from insomnia via Google, Yahoo! & Bing within a reasonable amount of time.

Silenor, if accepted by the insomnia population, doctors and healthcare insitutions will become a blockbuster drug in no time!

Disclosure: Long SOMX