Research

Search Engine Marketing:User and spending Trends

Search Spending by TypeIn 2007, paid search ads will contribute 62% to all search engine marketing spending, with SEO spending contributing about 18% to the pie. By 2011, however, a greater focus on SEO means that form of search marketing will represent nearly 23%, while paid search will fall back to not quite 57%.

Search Spending by Type

According to Forrester, a similar but more dramatic shift will occur in search marketing spending. However, the research firm sees paid search with only a 44% share in 2011, whereas SEO will contribute 33% to the whole.

Search Spending By Type

In dollar terms, the paid search market share will surpass $6.5 billion in 2007 and nearly double to almost $12.2 billion in 2011. Over the same period, spending for SEO and contextual advertising will more than double.

Overall, search engine marketing spending will rise spectacularly from $10.6 billion in 2007 to $21.5 billion in 2011.

Search Spending By TypeHowever, an Internet Retailer survey of chain retailers, catalog companies, Web-only merchants and consumer brand manufacturers showed 46.1% of respondents saying SEO performed best compared with 37.3% for pay-per-click advertisements.

People Who Search According to ongoing research from the Online Publishers Association (OPA) andNielsen//NetRatings, US Internet users in 2007 will spend less than 5% of their online timeusing search versus nearly 50% of their time on content sites.

People Who Search Who is the audience for search engines and the advertisers who love them? The followingsections help paint a fuller picture of the search audience by answering these questions:

• Who searches?• How many people search?• How often do they search?• Where do people search?• Where do searchers come from? Where do they go?• How many searches do people conduct?• How do people use keywords?• Why do people search?

Who Searches?A demographic profile of US search engine usersfrom Nielsen//NetRatings indicated thatsearchers were much like Internet users ingeneral, except for some salient differences.

For example, while 20% of the online populationwas younger than 18, a lower percentage usedeach of the five search engines included.Similarly, while 28% of the online populationWas between 35 and 49, a higher percentageused the five search engines.

Customer Satisfaction Consumer attitudes about search—and the data created each time people enter a search term increasingly count privacy as a valuable asset. The “Digital Footprints” report,released in December 2007 by the Pew Internet & American Life Project, studied the connections between online personalinformation and search. Though the report did not focus on search query data, it is a useful guide to

User Search BehavioursEarlier data indicated that AskEraser, or equivalent programs from other search engines, could win more users. The Center for Survey Research and Analysis at the University of Connecticut found that 60% of US adults somewhat or strongly opposed search engines permanently storing user search behaviors.

Trust is limited. At least that’s true among the 51% of respondents who expressed some degree of apprehension that information collected by search engines would remain private.

How Many People SearchAt least 155 million people in the United States used search engines in 2007. That group will riseby 25 million by 2011.

Search Engine Ranking Counting search users by search engine sites finds Google at the top of the heap. However, whilecomScore’s qSearch 2.0 service said there were 142.1 million unique users on Google inSeptember 2007, Nielsen Online’s MegaView Search service put that month’s figure at 105million.

How Often Do People Search90% of US consumers use search engines or portals weekly, according to the “State of MediaDemocracy” survey from Deloitte & Touche.

Where Do People Searchlooking just at September 2007, either 76.9% (comScore) or 77.9% (Nielsen) of unique searchersused Google. Similarly, either 35.3% or 33.2% used Microsoft sites or MSN/Windows Live,according to the two researchers.

Although shares differ for Yahoo!, the Time Warner network (mainly AOL) and Ask, those three,in addition to Google and Microsoft, get the greatest share of searchers.

Where Do Searchers Come From?For Google and Ask, the top 10 upstream sites delivered 37.7% and 43% of their October 2007 US visitors, respectively.

However, for Yahoo! Search and MSN Search, their top 10 upstream sites were far more concentrated, delivering 73.5% and 80.7% of their October 2007 US visitors, respectively.

The percentages for downstream visits among all four search engines were far more alike, ranging from 13% to 14.8% among the top 10 sites in that same month.

How Do People Use Key Words Wordtracker, a keyword analysis firm that derives its data from Infospace, a search aggregator, 23.2% of all keywords or search terms entered in the Augustto October 2007 period were entertainment related.

At the other end, only 2.3% of keywords came from either the health or the money and personal finance categories.

Top Five Key WordsThe top five keywords indicates several factors about the ways people use search engines.

MySpace and YouTube were searched for at least two different ways. That indicates how various spellings need to be bid on for any set of keywords.

Looking at the same category—or at the search sites, communication or e-commerce categories—it seems that the top searches might not be used so much to find things as they are to index things, a substitute for Web browser bookmarks.

Categories such as health and money and personal finance tend to garner more general terms. That implies that more searches, rather than user laziness, are taking place.

Average Number Of Key Words Over time, people do tend to enter more complex search queries. In data comparing the average number of keywords per query in July 2004 with July 2006, one- and two-word queries both decreased, while more Internet users went to three-or-more-word queries.

Why Do People SearchThe Internet is the tell-me-more medium—the world’s largest library, mall and local pub or schoolyard rolled into one.

What do people want to know more about? Those Web site categories that gained the greatest share of visitors directly from search engines included education, health and medical, food, and beverage and music, according to Hitwise data.

People search to shop, sometimes for pleasure and sometimes, as with health-related items, for necessity.

Why Do People SearchWhen people start to shop, a general search engine is the most-used online resource, more so for inexpensive than costly goods, according to the October 2007 “Digital Consumer Behavior Study” from Avenue A-Razorfish.

In the 2007 version of a Millard Group report, only 13% of US online buyers used a search engine to access a retail site.

Prior connections with the retailer, such as an e-mail promotion or a merchant link, are far more used. Of course, the initial contact used to create that connection might very well have come from a consumer search.

Initial Connection A similar 10% of Internet users cited search engines as their primary outlet for learning about new products, according to an Accenture report.

Yet even though TV might be the first way most people hear about a new product, a search can readily follow down the line as people look for a place to purchase the item.

SEO Attention In fact, among all the age groups polled by Deloitte & Touche, search engine results were morelikely to lead to site visits than any other form of advertising, including word of mouth, TVcommercials and display ads on other sites. So it’s no wonder that 40% of total Internet spending goes to paid search advertising.

SEO Attention No wonder, too, that search engine optimization will receive increased attention and spending,considering how 18.1% of retailers say that 10% or more of search engine shoppers visit theirsites as the result of a natural search listing.

SEO AttentionResearch from comScore and Yahoo! found that 43% of in-store buyers were influenced by acombination of online display and search ads. Even 26% of in-store buyers were inspired to handover their credit cards because of a paid search campaign.