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Yahoo Gains Search Market Share As Google Dips One Percent

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Yahoo Gains Search Market Share As Google Dips One Percent

Yahoo Gains Search Market Share As Google Dips One Percent

It will need to be verified by at least one of the other traffic trackers, but comScore said that Yahoo!’s search share showed a modest, fractional gain for the second month in a row (but down vs. a year ago). Google, by comparison, showed a single point decline.

Any positive indication on the search front for Yahoo! is reason to celebrate these days. We’ll see if it’s a trend. Here’s more from their release:

Americans conducted 6.3 billion searches online in July, down 2 percent versus last month, reflecting seasonal declines typically seen in July. Growth in search query volume on an annual basis remains strong, rising 30 percent since July 2005.

Google Sites led the pack with 2.7 billion search queries performed, followed by Yahoo Sites (1.8 billion), MSN-Microsoft (802 million), Time-Warner Network (366 million), and Ask Jeeves/Ask Network (338 million).

Google and Yahoo! continued their dominance in toolbar searches, combining for more than 95 percent of the market share in July. Google grabbed 50.3 percent of toolbar searches, while Yahoo! captured 46.2 percent.

Here’s data from a William Blair advertiser survey (via iMedia) that show how much is at stake in the battle for search market share:

William Blair equity research analyst Troy Mastin, who provides coverage on 20 marketing, advertising, and media companies, wrote in the survey, “All respondents indicated that they expect online marketing budgets to increase in 2006, with average expected growth of close to 20% (up from 19%). On average, responses indicated that prices increased by about 8.4% (up from 7.3%) during the first half of 2006.”

He also noted that consistent with last survey, brand advertising spending appears to be shifting out of traditional media and onto the Internet. Rich media and “other” forms of online advertising were selected by 45% of respondents as the fastest growing, up from 43% last survey, while search declined from 38% to 34%. Also, 51% of respondents indicated that traditional advertisers would be most responsible for growth, well ahead of the second choice of emerging advertisers at 24%.

The survey also showed a mixed outlook for Yahoo, Google’s continued dominance, and MSN slipping. “Despite aggressive investment by competition, Google continues to gain market and mind share, as 69% of respondents (up from 53%) characterized Google as the best-positioned major player,” Mastin added. “While our open-ended questions revealed optimism regarding Yahoo’s search platform enhancement initiative (Project Panama) and a community that seems to be rooting for the company, only 22% characterized Yahoo as best positioned, down from 30% last survey. The overwhelming view of MSN was either negative or that of indifference, which is surprising given the recent launch of adCenter.”

Even though search declined as an online ad vehicle it’s still the dominant category. Online display advertising growth (incl. video) is anticipated to be the beneficiary of online branding and traditional media dollars moving onto the Internet, which is also good news for Yahoo! Rich media/display was cited as the fastest growing format.

Still smart marketers know they have to blend online branding/rich media with search. You can’t really have branding without search.

The William Blair survey also indicated that marketers were concerned but not overly so with click fraud.

Greg Sterling is the founding principal of Sterling Market Intelligence, a consulting and research firm focused on online consumer and advertiser behavior and the relationship between the Internet and traditional media, with an emphasis on the local marketplace.

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