The traditional and commission-driven brokerage companies on financial markets use numerous strategies to thrive and survive in an endlessly dynamic and competitive environment. Some of the methods that they use most likely would not receive much approval from their clients, of course, if they were to know about these strategies. But few of them realize that the brokers that rank on the first page of their Google search results are not actually the best companies in the industry. Even the unregulated and often disguised brokers manage to appear on the top by implementing advanced SEO strategies and artificially increasing their traffic.
Well, in a competitive world with thousands of brokerage companies out there fighting for the attention of the traders, is it really that bad to focus on increasing the website traffic? It is completely understandable and may be acceptable at some point in the business world, however, it definitely hurts the global trading community who now cannot rely on the internet to choose their brokers.
How do brokers increase their website traffic?
There are tons of digital marketing strategies that aid companies increase their web presence and thus the number of visitors they get on a monthly basis. For instance, Forbes can list at least 23 proven traffic increasing strategies for any website and pretty much all of them work well. Since brokers can rarely advertise themselves using traditional media advertising channels, like TV commercials, billboards, etc, they rely on online marketing solutions, namely Search Engine Optimization (SEO).
These brokers will often put all their resources into optimizing their website contents for the high volume keywords. They look for what customers are searching on the web and modify their websites, names, pages and service contents just to match the search queries. In this way, search engines think that such pages are most appropriate for the users and hence displays them in top positions on SERP (search engine results page). When going through the most popular Forex brokers reviewed on any third-party website, you will notice that these brokers have similar content structure, similar page titles, similar product names, etc. However, it does not mean that they offer same services, it is just due to the fact that they work on the most popular keywords in Google and adjust their contents accordingly.
Why do brokers need high volume traffic?
At a glance, the answer is obvious – to get more clients and get more revenue. But, there are some things deeper than that. Usually, brokerage companies have one of the lowest conversion rates among the various markets. It means that very few people who visit the broker’s website will eventually register or deposit money. Even the number of users who start trading with the broker after the registration is extremely small compared to clients in other industries. First of all, this is due to the high risks involved in trading. Secondly, there is a huge trust issue.
Therefore, brokers need to artificially increase their website traffic in order to get more converted clients. Consider it this way – the main source of the broker’s financial income is the client only in case he or she trades. The brokers’ revenue models are based on commissions, spreads on trades, or other administrative fees that are charged on active accounts only and usually per trade. Therefore, brokerage companies trying to maximize their revenues and profits will often concentrate no increasing their web presence. But is it that big of an issue?
Why traders are negatively affected from such efforts?
First of all, it all goes back to trust. As a trader, if I know that the broker that I’m eyeing has got its 1st rank in the search results page artificially, has acquired 100,000 clients through keyword optimization only, has spent thousands of dollars on Google ads and social media visibility instead of providing legit decent service – I’m in doubt. Or at least, I should be. Well, losing the trust is the first and foremost factor caused by artificial increase in traffic.
Secondly, this approach keeps traders away from finding whatever they need in reality. For instance, if I need a low-spread Forex broker due to my trading style and budget but every single broker tries to rank for low-spread broker keywords I will not be able to find what I need. Essentially, the traders are forced to look for non-brokerage websites that review the services of individual brokerage companies. But can they be trusted? I mean brokers could easily pay these websites to write positive reviews regarding the company. One way or another search results cannot be trusted, not in the world of Forex unfortunately.