CPC Rates Rising as Spend Shifts among other Search Engines; Google Remains Dominant, But Others Growing Share in Local
IRVINE, Calif. – WebVisible, Inc., a worldwide leader in local online advertising, released its 2009 Q3 Report on the State of Small Business Online Advertising. This report, gleaned from data gathered over 90 days from a sample of WebVisible’s small and medium sized business clients, examines local interactive advertising trends through Q3 2009, using Q3 2008 as a baseline. WebVisible has worked with more than 100,000 clients across more than 3,000 vertical categories around the world. Copies of the report are available at: http://webvisible.com/learning-center/free-resources.php
Among the report’s highlights is its finding that Yahoo and Bing/MSN have both gained market share among the major search engines, perhaps as much as five percent (5%). The report also notes that the tide continues to rise for all the search engines in Local – including Google. Microsoft’s newly-launched Bing seems to be doing especially well since its summer launch.
“Microsoft spent a lot of money over the summer to launch Bing, and they targeted their campaign directly at local business owners,” said Matt Booth, SVP and Program Director, Interactive Local Media for BIA/Kelsey. “I should think that they would be encouraged by these results, as more and more SMBs move their ad budgets away from print and directories and online, small market share increases will come to represent big dollars.”
The WebVisible Report cites Bing/MSN’s higher click-through rates (CTR) in certain verticals as a potential explanation for this market dynamic. Projected strategically, this could bode well for Microsoft in the race to grab as much market share in the fast-growing, hyper-local market.
“The big picture is great news for SMBs and good news for the Engines,” said Kirsten Mangers, WebVisible CEO. “Local revenue is up across the board, and the number of first-time buyers to increase quarter-on-quarter. Anyone would feel good about the increased competition in these markets. But, the real news is that these SMB advertisers are getting results from their interactive budgets that they’ve been after for years now. Local interactive is on the rise – because it works.”
Rising Local CPCs – Rising Budgets?
Cost per Clicks (CPCs) – the amount advertisers spend for each keyword term or phrase clicked on by users – has been increasing steadily for small business advertisers. This, after a drop due to reduced spending in Q2 2009, CPCs stabilized in Q3. While Google still dominates the charts with the most market share, the numbers have decreased as advertisers spread their money across other search engines. In Q3 2009, Google accounted for 60.4% of search advertising spending. Yahoo! accounted for 26.2%, Bing* 10.5% and Ask 2.4%. Google lost five points year-over-year (YoY) as spend shifted among these other engines. Bing (formerly Live Search, Windows Live Search, and MSN Search) is the current web search engine from Microsoft and also powers Yahoo! Search, has stepped up to compete for a chunk of the local advertiser budget. With CPC rates almost 30% lower than Google in some verticals, according to the WebVisible Report, Bing has been able to gain market share from the Search giant.
Bing’s debut in the summer of 2009 featured an $80 to $100 million online, TV, print, and radio advertising campaign in the US alone. Without mentioning the competition, they attempt to convince users to switch to Bing by focusing on its search features and functionality. They claim that Bing does a better job countering “search overload,” offering more-relevant, higher-quality results and helps you find what you’re looking for faster than the competition. Regardless of the advertising spend to increase Bing’s awareness the WebVisible report indicates a shift in ad spend to given higher conversion rates and available advertising inventory.
Other notable findings in the WebVisible report show Click-through rates (CTR) improved YoY across all the engines, with the biggest improvement on Yahoo!, whose CTR improved 123% from Q3 2008 to Q3 2009.
About BIA/Kelsey
BIA/Kelsey advises companies in the local media space through Consulting and Valuation Services, Research, Continuous Advisory Services, and Conferences. Since 1983 BIA/Kelsey has been a resource to the media, mobile advertising, telecommunications, Yellow Pages and electronic directories markets, as well as to government agencies, law firms and investment companies looking to understand trends and revenue drivers. BIA/Kelsey’s annual conferences draw executives from across industries seeking expert guidance on how companies are finding innovative ways to grow. Additional information is available at www.bia.com and www.kelseygroup.com. The company’s blogs are located at http://blog.bia.com/bia/ and http://blog.kelseygroup.com, and it can be found on Twitter through http://twitter.com/BIAKelsey.
About WebVisible, Inc.
WebVisible, headquartered in Irvine, Calif., makes it easy for small and mid-size businesses (SMBs) to be found online, when and where customers are looking. The leading provider of local online marketing products and services since 2001, WebVisible was among the first to pioneer the use of search as a reliable, measurable avenue to connect directly with a buyer’s needs. It has helped more than 100,000 SMB customers from over 3,000 industries in 11 countries to create innovative and accountable Internet advertising campaigns.
WebVisible manages the entire online presence lifecycle, from take-off to landing, using its award-winning, proprietary Geneva Software Platform. Currently managing more than 600 million keywords daily, it oversees online advertising campaigns that are cost-effective, targeted and measureable. WebVisible’s inimitable approach combines the best of service by certified trained professionals and effective media buying management, ad creation, deployment and optimization for its customers.
SMBs partner with WebVisible directly and through its many partner companies, including Intuit, AT&T, British Telecom, European Directories and The New York Times Company. For more information, visit www.webvisible.com or call (949) 502-5757.
