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September 21, 2012

Search Engine Marketing Budgets Remain Healthy: Survey

North American firms will spend $23 billion in search engine marketing in 2012 — a 19 percent surge over 2011, a new report has found.

The State of Search Marketing Report 2012, estimated a 13 percent growth rate for search marketing in 2013. Some 58 percent of respondents foresee growing budgets in paid search and 55 percent in SEO this year.

The bulk of those who are not upping budgets are keeping them about the same, while 17 percent will decrease spending in paid search and 11 percent in SEO, the study found.

Search marketers identified changes in Google’s algorithm, puzzling cross-channel attribution models, lack of mobile analytics and retaining talent as their chief concerns for 2012.

Eighty-seven percent described Google’s algorithmic updates during the last 18 months as “significant or highly significant.” Although marketers, in most cases, said the changes were positive, “combating SEO spam sites can come at the expense of many legitimate brands,” the report stated.

The “integration and measurement of multiple channels” remains a challenge, as marketers attempt to gain a better understanding of the impact from all search-related channels.

Thirty-four percent of professionals are concerned with integration and measurement of other online and offline marketing channels this year, up five percent since 2011.

Other findings:

•  Survey responses show a drop in the blunt objective of driving traffic, but it remains a key goal for SEO. More than double the number of agencies cited brand/reputation as a goal, up from five percent in 2011 to more than 11 percent in this year’s survey.

•  As with SEO, many agencies evaluating their clients’ goals for paid search cited brand/reputation as their No. 2 goal which, largely, came at the expense of “generating leads,” which nonetheless remains the top priority.

• Some companies, especially those with advanced attribution methods in place, are using pay-per-click (PPC) as an “assisting” channel to build brand terms and ideas. This, the study found, has a greater cumulative effect on lead generation than campaigns designed for immediate returns.

• Use of social media is moving away from being purely a means for thought leadership and branding-related goals. According to the study, companies do not expect immediate revenue through this channel any more than they were in 2011.

Published by Econsultancy, the report is based on a global online survey of nearly 900 companies and agencies. The SEMPO study, now in its eighth year, is based on information provided by organizations from 36 different countries, and from marketers and agencies across a range of sectors.