One of the first panels here at SES San Jose is the Search Industry Update. This panel tends to dive into the over all health of the industry and specifically where the major search engines are today. Not one of the funnest sessions of the week as it tends to be a bit dry unless you are a real search engine statistics geek. This morning we had a number of presenters each with a different perspective on the big picture of the search industry.
First up was Sean Walsh VP of Online Marketing for LuxuryLink.com
Sean’s focus was the overall American economy and its effects on the Search Industry. Using the hotels as an example of the “real” state of the economy, he offered the following statistics:
- The Keyword “Vacation” has dropped in search volume over the past 4 years
- Hotel vacancies are up between 3.5% and 12% depending on the location
- Investment in hotels has more than doubled in the last three years
He offered that while the consumers are pulling back the investment community is still pouring money into the space. Additionally he displayed a graph of the current inflation index and the inflation index as it would show if they had not changed the formula after the inflation problems in the late 1970s. If we calculated the index using the same methodologies, we would be at almost the same levels we were back then.
So what does all this mean to search, well according to Sean, the increase in online spending by advertisers is helping us though this economy issues. However, “The American Economy is in worse shape than we would believe” according to Sean and this will cause a rough road in the next couple of years for search marketers.
Next up was Heather Dougherty Research Director for Hitwise.com
Heather emphasized to us that Google’s grasp of the market is only getting stronger. In July Google increased its overall search penetration by 10% over the previous year and surpassed 70% of all searches. While this did not surprise or was not news to most in the room, most did not know that Google is maintaining a repeat visitor rate of 95% month over month. Additionally, they are keeping the 5% of brand new visitors they acquire each month seemingly without fail.
Impact of search varies widely among industries according to Heather. According to statistics compiled at Hitwise the Automotive industry relies on search the most with 38% of its traffic driven by search. Of the industries measured, the least reliant was the banking industry where search provides only 8.5% of its traffic.
Hitwise is also able to segment out paid search specifically. When measuring paid search, the industries shift position. Percentages of paid search used to drive traffic in a specific industry were shown to the audience as follows:
- 30% – Retailers Online/Offline
- 35% – Auto Dealers/Manufacturers
- 16% – Banks and Financial Institutions
- 14% – Food and Beverage Companies
- 12 % – Grocery Chains
- 9% – Employment Services
Kevin Lee Chairman & CEO of Didit.com was up next
While Heather focused on Google share of the search query market, Kevin’s looked a bit closer at how much of the overall $$ pie is Google eating. Google percentage of marketing budgets is growing just a impressively and its market share. They have gone from 64% of spend to almost 74% of paid marketing budgets in the last couple of years. So according to Kevin 74% of online marketing budgets today are going to Google. That’s a huge number folks.
Kevin also referenced a SEMPO Poll related to PPC, “Could your afford further price increases?” 69% of the respondents said that had more room to move up if the cost of PPC kept going up. Most said they would do this mainly by improving program efficiencies and site conversion rates.
Some of the areas of focus Kevin mention which might improve or make a difference in include:
- Contextual focus
- Re-targeting content
- Keyword rich Video and Rich Media
- Better Control of Syndication
- Real-time (cookie/profiledriven) targeting
- Blended Display and Search
- Google/Yahoo alliance
Jaideep Singh,CEO of Spock.com closed us out
Jaideep had a hard time getting past his intro. Spock.com is a people search engine and after describing his product people in the audience started hitting him with security and privacy questions to the point that he was not able to get to the meat of his presentation. I am going to try and follow up with him later today if I can.