It is estimated that in the UK market, search engine marketing will be worth a whopping £1.41 billion by the end of 2006 (an overall 65% growth rate for both paid and organic search). It's paid search, the new boy on the block, that accounts for the majority of this market with an estimated value of more than £.126 billion. However, on the other hand organic search is still thriving and E-Consultancy estimates that SEO will grow a further 50% by the end of 2006 to a value of £147 million.
So what is driving these rapid growth rates?
The reasons can be broadly grouped into 4 areas:
- Demand. A recent IAB report pointed out that online advertising now accounts for almost 8% of the total advertising spend in the UK, whilst up to 25% of media consumption is now online. Paid search is an ideal avenue for advertisers to address this gap.
- Internet usage in the UK is still increasing. Marketers are becoming increasingly wise about reaching these internet users whilst they are in "search mode" and are more likely to convert.
- Organic search is now seen as strategic and can compliment the investment in paid search. Improved analytical tools have highlighted the positive effects organic search can have on Return on investment (ROI).
- Firms now see search as a vital part of the marketing function and understand that, when integrated with other online marketing activities and traditional marketing methods, search becomes even more powerful.
The vital point is that search marketing is now being seen as part of an overall marketing strategy recognised at boardroom level of many companies. With this school of thought being adopted across the board, search marketing will continue to grow and prosper in 2006 and beyond.
