Search Marketing:Counting Dollars and Clicks

SUMMARY

Search engine marketing is a highly concentrated industry. Over 90% of US paid search ad spending will go to Google and Yahoo! in 2007. One result of this concentration is that it often makes advertising on second-tier search engines a better value- less competition for keywords means a broader reach for fewer ad dollars.

The Search Marketing report delves into all aspects of online search advertising- and analyzes how the fast-changing trends will affect marketers large and small.

Key questions the "Search Marketing" report answers:

• Will US paid search ad spending continue to grow?
• What trends support growth in search engine marketing?
• Other than Google and Yahoo!, which search engines get the most users?
• On average, how much do search keywords cost?
• Which works better, paid search advertising or search engine optimization?
• And many others...

eMarketer Reports- On-Target and Up-to-Date

The Search Marketing report aggregates the latest data from a range of marketing and communications researchers with eMarketer numbers, projections and analysis to provide the information you need to make the right business decisions- today.

TABLE OF CONTENTS

Executive Summary

• Google and Yahoo!'s Share* of US Paid Search Advertising Spending, 2004-2007

Issues & Questions

The eMarketer View

• Key eMarketer Numbers: Search Marketing

Search Spending & Revenues

• US Paid Search Advertising Spending As a Percent of Total Online Advertising Spending, 2000-2011
• US Paid Search Advertising Spending, 2000-2011 (millions)
• US Paid Search Advertising Spending Growth, 2001-2011 (% increase vs. prior year)
• Comparative Estimates: US Paid Search Advertising Spending, 2006-2011 (billions)
• Comparative Estimates: US Paid Search Advertising Spending As a Percent of Total Online Advertising Spending, 2006-2011 (% of total)
• Comparative Estimates: US Paid Search Advertising Spending Growth, 2006-2011 (% increase/decrease vs. prior year)

Market Leaders: Google & Yahoo!

• Google and Yahoo!'s Share* of US Paid Search Advertising Spending, 2004-2007
• US Paid Search Advertising Revenue* Growth at Google and Yahoo!, 2004-2007 (% increase vs. prior year)
• US Paid Search Advertising Revenues* at Google and Yahoo! As a Percent of Total Online Advertising Spending, 2004-2007
• US Paid Search Advertising Revenues* at Google and Yahoo!, 2004-2007 (millions)

Spending Trends

• Year that Search Engine Advertisers Worldwide First Engaged in Paid Placement Search Advertising, by Business Size, December 2006 (% of respondents)
• Select New Online Media that US Advertising Executives Consider Most Effective or Very Effective, 2006 (% of respondents)
• Percent of Media Budget that US Advertising Executives Plan to Allocate to Select New Online Media in 2007
• Interactive Marketing Channels that US Marketers Are Currently Using, Piloting or Expecting to Pilot within the Next 12 Months, December 2005 (% of respondents)
• Most Important Advertising Tactics that US Marketers Plan to Use This Coming Year, December 2006 (% of respondents)
• Paid Search Spending Increases Planned for 2007 according to Search Engine Advertisers Worldwide, December 2006 (% of respondents)
• Top 10 US Search Engine Marketing and Optimization Agencies, Ranked by Revenues, 2005 (millions, % increase vs. prior year and number of employees)
• Source of Budget for Paid Placement and Paid Inclusion Programs according to Search Engine Advertisers Worldwide, by Business Size, December 2006 (% of respondents in each group)
• Existing Marketing Budgets Being Shifted to Search Marketing Programs by Search Engine Advertisers Worldwide, December 2006 (% of respondents)
• Average and Largest Client Spending in 2006 on Search Engine Marketing according to Search Engine Agencies Worldwide, by Type, December 2006 (gross spending)

Keyword Usage & Costs

• B2C Keyword Purchase Volume in the US, September 2004-August 2006 (% increase vs. prior year)
• US Media Executives Who Are Paying More to Purchase Search Keywords, Q1 2006 vs. Q4 2005 (% of respondents)
• Cost-per-Click (CPC) for Google and Yahoo! Paid Search Listings, 2005 & 2006 (% increase vs. prior year)
• Average Number of Keywords per Search Query Used by Internet Users Worldwide, July 2004 & July 2006
• Average Number of Keywords per Search Query Used by Internet Users Worldwide, January 2007 (% of respondents)
• Select Cost-per-Click Charges on Select Keywords on the Yahoo! Search Site, January 26, 2007 (price for top position)
• Cost per Click for Select Paid Search Terms on Yahoo! Search Marketing, by Top Five Positions, January 2007
• Cost per Click for Select Paid Search Terms on Yahoo! Search Marketing, by Top Five Positions, January 2007 (% increase/decrease vs. prior year)
• Cost-per-Click (CPC) for Google, Yahoo! and MSN Paid Search Listings, 2004-2006 (average)
• US Search Marketing Average Price per Click (PPC), 2003-2010 (% increase vs. prior year)
• Average Keyword Price in the US, Q4 2005-Q4 2006
• Average Pay-per-Click Term Cost for the Top Key Terms among the Top Five Industries* Using Search Marketing, Q1-Q4 2006
• US Marketers Who Bid on 10,000+ Keywords, 2005 & 2006 (% of respondents)
• Type of Search Keywords that US Internet Users Enter prior to Their First Click on a Paid Search Ad, Q1 2006
• Trademark Use in Paid Placement Search Advertising according to Search Engine Advertisers Worldwide, by Business Size, December 2006 (% of respondents)

Measuring Results

• Metrics that Advertisers and Agencies Worldwide Track to Gauge the Success of Search Engine Marketing Programs, December 2006 (% of respondents)
• Top Goals of Search Engine Marketing Campaigns according to Search Engine Advertisers Worldwide*, 2006 (% of respondents)
• Metrics Used by US E-Commerce Executives to Measure Pay-per-Click (PPC) Campaign Success, 2006 (% of respondents)
• US Search Marketing Click-Through Rate (CTR), 2003-2010
• Sponsored Search Advertising Impressions and Click-Through Rates for Select US Online Travel Web Sites, April 2006
• Conversion Rates for First Clicks on Paid Search Ads Based on Type of Keywords Entered by US Internet Users, Q1 2006
• Natural vs. Paid First Clicks that Led to Conversions via US Search Engines, 2006 (% of converted first clicks)
• Brand vs. Non-Brand First Clicks that Led to Conversions via US Search Engines, 2006 (% of converted first clicks)
• First Clicks vs. Multi-Clicks* that Led to Conversions via US Search Engines, 2006 (% of total converted clicks)
• Leading Problems with Search Engine Marketing according to US Search Marketers, by Business Size, 2006 (% of respondents)
• Measurements/Analytics in which US Online Marketers* Plan to Invest Next Year, by Type, 2005 & 2006 (% of respondents)

Search Engines: Comparative Stats

• Share of Online Searches in the US, by Search Engine Provider, July 2006-January 2007 (% of total)
• Top Five Search Engines in the US, Ranked by Share of Searches, August 2006-February 2007 (% of total)
• Leading US Search Engines, Ranked by Volume of Searches, December 31, 2006-January 27, 2007 (% market share)
• Top Five Search Engines in the US, Ranked by Number of Searches, August 2006-February 2007 (millions)
• Degree of Google Usage among US Internet Users, November 2006 (% of respondents)
• Search Engines Used by US Search Engine Users, August 2005 & 2006 (% of respondents who used the search engine that month)
• Paid Placement Search Engine Networks on which Search Engine Advertisers Worldwide Run Campaigns, December 2006 (% of respondents)
• Search Engines Used by US E-Commerce Executives for Pay-per-Click (PPC) Marketing, 2006 (% of respondents)

Selecting Tactics: Paid Search vs. Organic SEO

• Best ROI for Product Marketing Tactics according to US Marketers, Spring 2006 (% of respondents)
• Advertisers Worldwide Who Currently Engage in Paid Placement Search Advertising or Organic Search Engine Optimization, by Business Size, December 2006 (% of respondents)
• Advertising or Marketing Vehicles that Provide the Highest Return on Investment (ROI) or Advertising Spending (ROAS) according to Advertisers Worldwide, December 2006 (% of respondents)
• Best ROI for Lead Generation Tactics according to US Marketers, Spring 2006 (% of respondents)
• Paid and Natural Search Conversion Rates in the US, August 2006 (average)
• Paid Search vs. Organic Search Conversion Rates at B2C E-Commerce Web Sites Worldwide, January-August 2006
• Search Marketing Conversion Rates for Paid Search Advertising vs. Search Engine Optimization (SEO) in the US, by Campaign Goals, August 2005
• Multi-Click* Users Who Switched between Paid and Natural Listings that Led to Conversions via US Search Engines, 2006 (% of each group)
• Level of Experience or Interest in Contextually Targeted Text Advertising* according to Search Engine Advertisers and Agencies Worldwide, December 2006 (% of respondents)
• Percent of Paid Placement Search Advertising Spending that Goes to Contextually Targeted Text Ads according to Search Engine Agencies Worldwide, December 2006 (% of respondents)

Click Fraud

• Type of Click Fraud Experienced by Search Engine Advertisers and Agencies Worldwide, by Business Size, December 2006 (% of respondents)
• Average Click Fraud Rates in the US, Q2 2006-Q4 2006
• Search Engine Advertisers and Agencies Worldwide Who Have Been the Victims of Click Fraud, by Business Size, December 2006 (% of respondents)
• Average Click Fraud Rate for Companies Running Online Advertising Campaigns through Search Providers in the US, Q1 & Q2 2006
• US Advertisers Who Plan to Reduce or Have Reduced Their Pay-Per-Click (PPC) Spending Because of Click Fraud, 2006 & 2007 (% of respondents)
• Attitudes of US Search Marketers toward Click Fraud, 2006 (% of respondents)
• Degree to which Click Fraud Is a Problem with Regard to Paid Placement Search Advertising according to Search Engine Advertisers and Agencies Worldwide, by Business Size, December 2006 (% of respondents)
• Leading Problems with Search Engine Marketing according to US Search Marketers, by Business Size, 2006 (% of respondents)

Consumer Profile: Actions & Attitudes

• Demographic Profile of US Search Engine Users, by Search Engine, October 2006
• Best Search Engine according to US Internet Users, November 2006 (% of respondents)
• Internet Users in North America Who Use Search Engines, by Frequency, Q2 2006 (% of respondents)
• Average Number of Internet Searches Done Each Day by US Internet Users, November 2006 (% of respondents)
• Frequency of Search Engine Usage among US Internet Users, by Search Engine, November 2006 (% of respondents)
• Methods that US Internet Users Most Often Use to Navigate to a Web Site, November 2006 (% of respondents)
• Attitudes of Search Engine Users in North America toward Search Results, by Frequency of Search Engine Usage, Q2 2006 (% of respondents)
• How US Internet Users Locate the Blogs They Read, November-December 2006 (% of respondents)

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