On the other hand, they compete for digital advertising dollars. We see industry trends pointing toward search as Google’s paid click revenue continues to accelerate, having jumped from between 15 percent and 18 percent between Q2 2010 and Q2 2011 to 28 percent in Q3 2011.

But, there’s also evidence of a healthy growth pattern in digital display. Forrester Research points out that by 2016, display advertising will triple in spending (reaching $27B), compared to search, which will double.

So, how will marketers choose where to invest their online budgets? There are several thoughts to how this will pan out in our recent report, The Future is Now, which focuses on the driving forces behind the innovation of search and display. However, let’s begin by looking at several pieces of a digital campaign.

Search & Display Go Head To Head

First, there is the distribution of the average user’s time spent online. Display pulls ahead with users spending an average of 96 percent of their time on content related sites, compared to 4 percent, which is spent in search engines.

However, according to the Pew Internet Study, 92 percent of Americans use search engines to find information on the Web, while 76 percent use the Internet for news and 65 percent for social networking. Here, both search and display score a point.

Next, let’s look at context and creative. On search engines, users are met with small, text-based ads that lack the design appeal of the larger, interactive display advertisements. The ads are directly related to what they’re searching for, but lack the flash and zest of the display ads. Point two awarded to the display channel.

Then there’s performance. We can’t overlook the fact that search is one of the highest performing ads in the world. It’s the king of conversion. I’m not saying get rid of your display campaign or disregard the power of search – what I’m talking about here is leveraging the data within the search channel to drive performance beyond the search engine.

With search data becoming a larger part of targeted display advertising, I’d say search scores the big point here.

Speaking of data…There’s no arguing that fact that search data is the highest indicator of intent. Clearly, that’s a point for the search folks. But, let’s not move on too quickly. Data is on the cusp of a sea change in how marketers leverage their information to reach consumers across multiple display mediums. Points awarded to both teams.

Finally, let’s examine user experience. ComScore cites that Americans conducted 19.5 billion total core search queries in September 2011 (up 1 percent from the previous month).

Based on the above assessments, we know that the creative advertisements we see outside of the search engine are more appealing, but that consumers most likely prefer the ads that speak directly to our own personal interests, desires and behaviors. So who gets awarded the point?

What To Expect From Search & Display In 2012

In the report noted above, Rob Griffin, EVP, global director of product development at Havas Digital, makes a pointed argument for how search is perceived by marketers. Griffin said:

“Marketers have traditionally thought of search as a solution to their pain points. For the first time, you’re seeing customer-facing innovation on the back end. More specifically, search’s evolution is playing out very similarly to what we experienced with TV and online video as it’s driven by need and a desire from the consumer.”

So, is there really a victor to crown? Not, really. My scorecard would show it’s a tie.

As we enter into 2012, we’re poised in anticipation of how these two channels will come together. My prediction for 2012 is that display growth will outpace search growth as print dollars move online and targeting improves. This will drive search marketers to find ways to scale their SEM campaigns and push display advertisers adopt strategies for targeted awareness.

With the growth of data and innovation in targeting technology for display media, marketers can get the best of both worlds by mixing search data in their display advertising.

This year, retailers know e-commerce sales will be up. What they think they know (or admit they can’t predict) is how the huge shadow of the sluggish economy will impact their season. It’s the great unknown. The season’s wild card, if you will.

First, let’s review some numbers and predictions for the coming months. According to comScore, the 2010 holiday season reached $32.6 billion, setting an all-time record.

Now, the US Department of Commerce cites e-commerce revenue for the second quarter of 2011 at a 4.2 percent increase over 2010. Plus, eMarketer and comScore just announced that we’re projected to see a growth in holiday e-commerce spending of about 12 percent from 2010.

From this, we know that the stage is set for a knock-out, record-breaking holiday season. Now, how do you update your digital strategy to reflect the trends from the past 12 months?

Let’s take a look at five tips for retailers to make the most out of what they know (and what they think they know) about digital marketing in today’s economy to make the most of the holiday spending.

Evolving Search Strategies

Search strategies have morphed from an Internet strategy to a customer strategy. As the industry came out of the disaster of 2009, last year was just a matter of regaining some stability.

Search was an efficient and defensible strategy. Now, it puts marketers in the closest proximity to the customer decision. SEM is about being present when customers begin researching their decision, the beginning of the funnel, and when they execute a sale, at the bottom of the funnel.

Search retargeting is about being present during the consideration phase, after the customer has raised his hand, signaling intent within the search engine.

Customers that have declared themselves “ready to buy” are invaluable in today’s uncertain economy. That’s what retailers know. Search retargeting enables them to know as much as possible about their intent and how to find them.

Collect & Use Data For Retargeting

Search data, which represents the highest form of intent data, can be captured and applied beyond the search engines. Too many retailers still let search campaigns come and go without capturing that essential customer data and then leveraging it for their broader marketing strategies.

E-commerce has become event driven just like Black Friday and even though retailers are preparing for inventory needs and tracking price competition, don’t forget data. It is the best tracking for overall customer trends.

Double Up On Text & Display Ads

This year, text and display ads are more integrated into search strategies. Search retargeting has met that challenge. Text as well as display are easily integrated into search retargeting efforts.

According to SEMPO and eConsultancy’s “The State of Search Marketing Report 2011,” nearly 53 percent of respondents are now shifting their marketing budgets from print to search marketing. That means images (i.e. display ads on search) will become more important.

Align Text, Display Ads With User Activity

Data guru Mary Meeker recently made her predictions and observations for the past year and coming year. Meeker claimed that marketers are not spending in proportion to where people are spending their time.

According to the OPA and Nielsen Data, only 4 percent of consumers’ Internet activity is actually spent in search engines, leaving 96 percent of users’ time spent on display areas like content sites, social networks, etc. Meeker also pointed out that print represents 8 percent of people’s time and 27 percent of ad spending.

Mobile, by contrast, accounts for 8 percent of people’s time and 0.5 percent of ad spending. Google’s paid click growth continues to accelerate, having jumped from between 15 percent and 18 percent between Q2 2010 and Q2 2011 to 28 percent in Q3 2011. It’s easy to see where the smart money will go. Smart customers are already there.

Brand Through Display & Search Retargeting

That’s right, brand. Make that search query bring your brand to life by following up with that user beyond the search engine. The ability to apply the power of intent data as seen in search engine, to digital display advertising will go a long way for retailers this holiday season.

The most important thing for any retailer is to increase their online presence, coupled by reaching the relevant in-market shoppers.

As the dust clears on Black Friday, Cyber Monday and the rest of the holiday shopping season, 2011 needs to emerge as the year of stability and profitability. But, when you look back on 2011, will you realize that you thought you knew what you needed to execute successful digital campaigns? Or will you know it?