SEMPO formally released data on the state of search engine marketing, its annual survey of agencies and marketers. This year’s survey consisted of 800 respondents from all over the globle. However 68 percent of respondents were from the US, with 20 percent coming from a range of countries. Seven percent of respondents were from Canada and 5 percent from the UK.
The respondents/clients represented a range of industries. The top sectors were “retail, business services, electronics manufacturing and financial services.”
As part of the findings and related report SEMPO forecast that SEM spending would grow from a projected $14.7 billion in 2009 to $26.1 billion in 2013. SEM is defined broadly as all spending on search-related marketing including SEO. Consequently it represents more than the share of online ad revenues that the IAB assigns to search.
The report is lengthy and extremely detailed. Among other things it explores what marketers are willing to pay for specialized offerings or enhanced targeting including behavioral, local and mobile. Here are some of the high-level findings:
- In the past three years, offline channels are most frequently cannibalized to move budget towards SEM. This year, the top marketing channels advertisers are shifting budgets from are print magazines (26%), direct mail (21%), and print newspapers (19%).
- However, the degree to which certain channels are cannibalized is a bit lower than in last year’s survey. Only a quarter of advertisers (26 percent) report they are shifting budgets from print magazine advertising (down from a third last year), and only 15 percent of advertisers are cannibalizing their web site development budgets. Other channels affected by a shift in spending include TV advertising (13 percent), conferences (10 percent) and print yellow pages (9 percent).
- Organic SEO has always been the favored search marketing tactic among advertisers, but its popularity has risen significantly, from 80% in 2005 and 76% in 2006, nine out of ten advertisers using it the past two year.
- Advertisers are most willing to pay a premium for targeting consumers based on behavioral metrics followed by demographic targeting
- There is growing interest in new platforms for search marketing such as video and mobile search, and growing willingness to pay more for these emerging vehicles
In the context of the debate surrounding whether search is a branding or direct response medium, one of the most interesting findings was that respondents said “brand awareness” was the top goal of paid search, which took over from “sales” in the previous year’s report. The larger the firm the more the goal shifts from sales to brand awareness, which makes a certain amount of logical sense. Still I found it interesting.
Some charts from the report:
Where are marketers transferring budgets from to support paid search?
Source: SEMPO/Radar Research (2/09)
Overall the report shows the search industry to be maturing and increasingly sophisticated, diversifying into a range of related digital media.