The Unstoppable Surge of Search Advertising

• Posted: Saturday, April 21, 2007
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• Author: pradhana
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• Filed under: Google, Marketing, Online Services, Yahoo

There are two giants in the space, and they are getting bigger!

Saying that search engine marketing is a highly concentrated industry is an understatement.

Looking at the numbers, according to comScore, US Internet users performed 75.8% of their January 2007 searches on Google or Yahoo!, and Nielsen//NetRatings put the combined total at 76.4%.

"In fact, over 90% of US paid search ad spending will go to the two search giants in 2007," says eMarketer Senior Analyst David Hallerman, author of the new Search Marketing: Counting Dollars and Clicks report. "One side effect of this degree of concentration is that it can often make marketing on second-tier search engines often a better value for the money — less competition for keywords means that advertisers get broader reach for fewer ad dollars."

Paid search makes up the largest slice of the US online advertising market, as it has since 2003.

"The point to note, however," says Mr. Hallerman, "Is that with its 42.5% contribution to the online total in 2007, according to eMarketer's estimates, paid search's spending share has remained fairly level at the 40%-plus plateau since early in the decade."

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