Search Trends - Search Engine Marketing

It's not really news that paid search marketing (natural, too) is a serious lesson in the economics of supply and demand. As more and more advertisers catch on to the idea that search marketing actually yields measurable results, the supply is having a hard time keeping up with the demand. Even with search growing at a decent rate, search volume is just not able to keep up with advertiser demand. This shortage of search volume is driving up search prices like crazy. I believe the increased bid prices also increase the value of unpaid or natural search listings. Natural search is one of those "secret" market tactics that writers never seem to mention in stories like this one. Perhaps because it's not considered an advertising channel because it doesn't cost anything and you can't just buy your way in like you can with paid search. The author of this article from the NY Times makes a valid point (citing data from NetRatings) about the limited supply of keyword searches, and it's always interesting to read the point of view of non-search marketing professionals who write about search marketing.

Here's an excerpt:

"SEARCH engines like Yahoo and Google have spawned bidding wars among a growing number of marketers who want to place their ads next to search results. That is a beautiful thing for Yahoo and Google, of course, but in the long term, some analysts think it could haunt them.

According to a report to be released today by the Internet research firm Nielsen//NetRatings, the demand for search advertising is growing far more quickly than the supply of available advertising spots. The report's author, Kenneth Cassar, said the implications could be far reaching.

'In the long term, we'll hit a wall where a lot of the search buys that make sense today won't make sense anymore because prices will have risen so high,' Mr. Cassar said. 'So for the search engines to grow their revenues, they'll have to increase supply.'"


Read entire article on The New York Times (Reg. required)