£2.2 Billion Spent On Search Engine Marketing in 2007

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£2.2 Billion Spent On Search Engine Marketing in 2007

UK companies are expected to spend £2.2 billion on search engine marketing this year, up 58% from 2006, according to E-consultancy’s SEM Buyer’s Guide (2007).

Although the market does not seem to be growing as fast as it did last year, growth figures are higher in the search industry than most other industry verticals. The main driver for this growth is that an increasing number of companies and marketing personnel are recognising the value of search in the overall marketing mix.

The growth in the overall search engine marketing sector from 2004 to 2007 can be seen in the graph below:

Growth in SEM expenditure 2004-2007

According to E-consultancy’s report, trends within this market include:

  • Increased focus on organic search
  • Greater ‘savviness’ about paid search ROI
  • More complexity and integration with other marketing channels
  • Sector consolidates as agencies seek broader range of skills
  • New platforms offer further growth potential.

Growth in paid search advertising is expected to slow down from last year’s 67% to about 56% this year, as seen in the graph below, due to increased competition and keyword price inflation. Paid search will, however, still account for 89% of the total search marketing spend.

Growth in PPC expenditure 2004-2007

An increased awareness of the importance of an organic search presence is expected to drive SEO to increase by 68%, which is much faster than PPC or than its own growth rate of 50% in 2006. The trend in SEO growth from 2004 to 2007 can be viewed graphically below:

Growth in SEO expenditure 2004-2007

The Buyer’s Guide for 2007 covers a lot more ground including the increased focus on ROI in paid search, pricing models and market positioning. It can be purchased at:

SEM Buyer’s Guide 2007