News Markets Media

USA | Europe | Asia | World| Stocks | Commodities

Home News USA US Search Ad Spending Falters?

US Search Ad Spending Falters?
added: 2009-02-09

Search advertising used to be reliable and solid, but growth is slowing even in this stalwart segment of the online economy. US search advertising spending fell 8% year over year in Q4 2008, according to search marketing firm Efficient Frontier. The company said it was the first quarterly decline on a year-over-year basis since it began monitoring search ad spending.

Reductions among smaller companies that spend less than $50,000 on search ads per month were even more profound: Efficient Frontier said such firms cut their spending by 23% year over year. Advertisers that spend more than $200,000 on search monthly cut spending by 9%, while those that spend between $50,000 and $200,000 held relatively flat.

Search ad spending among financial advertisers fell 20%, and automotive spending dropped 15% for Q4 2008 versus Q4 2007. Retail advertisers increased spending 9% in Q4.

"You need to read between the lines when examining the new search data from Efficient Frontier," said David Hallerman, eMarketer senior analyst. "Even though the SEM company says US search ad spending fell by 8% in Q4 2008, reported earnings from the major search companies counter that data."

"For example, Google’s US net search revenues in Q4 were up by 17% year over year. And over 65% of the US search market belongs to Google. Furthermore, Yahoo! reported that its US search revenues in Q4 were up by 18% - and that portal has an 11% market share".

"One must conclude that the Efficient Frontier data, based as it is on its own client base, reflects the particular financial problems of those verticals. Those include financial services, travel and entertainment, retail, and automotive."

While US search advertising is still expected to grow 14.9% in 2009 to $12.3 billion, that rate is down from 21.4% in 2008, according to eMarketer. For 2010 through 2013, search ad spending growth estimates are choppy.

Source: eMarketer

Privacy policy . Copyright . Contact .