Study: Huge Potential SEM Spend Untapped

A new JupiterResearch, Marin Software-sponsored study has found some surprising things about large-search marketers and their SEM spending: more than 90 percent would spend as much as 22 percent more — if they had better tools and technology to manage complex campaigns. That potentially represents hundreds of millions — even billions — of dollars that […]

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A new JupiterResearch, Marin Software-sponsored study has found some surprising things about large-search marketers and their SEM spending: more than 90 percent would spend as much as 22 percent more — if they had better tools and technology to manage complex campaigns. That potentially represents hundreds of millions — even billions — of dollars that are untapped by the industry because technology isn’t keeping pace with the needs and demands of the industry’s larger marketers.

The study, called “Large-scale Paid Search: Challenges and Opportunities,” surveyed 103 agencies and advertisers spending at least $50,000 per month in paid search:

  • 53 percent of respondents were spending between $50,000 –$250,000 per month
  • 30 percent spent between $250,000 –$1 million
  • 17 percent spent over $1 million per month on search marketing

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The challenges and pain seemed to be greatest for those spending the most money on search ($500K+ per month). According to the survey:

  • 78% believe managing large keyword lists is cumbersome
  • 59% say they have insufficient personnel to manage their paid search campaigns
  • 69% said existing applications are not robust enough for their needs

Many critical SEM functions, according to the survey, are “still” being managed with Excel:

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Despite the complexity of managing large SEM campaigns, 79 percent of survey respondents reported spending more on paid search management every year. The majority of the advertiser (as opposed to agency) respondents also said that increasing use of search/PPC campaigns is a “top priority.”

In the most recent IAB report, paid search increased its share of the online ad spend in the first half of 2008 to 44 percent, compared with 41 percent a year ago. Search appears to be holding up reasonably well, at least vs. other online ad categories (i.e., display), in a bad economy.

We’ll see when Google reports its Q3 results tomorrow and Yahoo next week. I’m sure they wouldn’t mind a piece of that 22 percent (potential) additional PPC spend that appears to be waiting there — on the table.


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About the author

Greg Sterling
Contributor
Greg Sterling is a Contributing Editor to Search Engine Land, a member of the programming team for SMX events and the VP, Market Insights at Uberall.

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