Report: Paid Search Prices On The Rise

    March 10, 2008

Companies hoping to ride out a recession may be able to rely on paid search advertising, according to a new report.  Natural search shouldn’t be forgotten, though, and paid search campaigns are likely to cost more than they have in the past.

Report: Paid Search Prices On The Rise
   Tim Kauffold

Tim Kauffold, Oneupweb’s director of business development, explained to Sarah Mahoney, "One of the things that surprises marketers – particularly those who have been using the media for several years – is how the costs are rising.  They think, ‘Why doesn’t the same dollar buy me the same volume it used to?’  But there are really big inflation numbers with cost-per-click.  It’s still a great avenue, but as more folks jump in, costs are going higher."

Oneupweb found that 48 percent of all U.S. online advertising spending in 2007 went towards paid search.  Also, paid search grew by 32.2 percent in 2006, whereas traditional media climbed by only 0.5 percent.

These trends are likely to continue; Oneupweb confirmed that, when integrated with a natural SEO campaign, paid search offers a better ROI than most other forms of advertising.  "It increases conversion rates and suggested sales, and even improves brand recognition," stated Lisa Wehr, the company’s CEO.

People and companies interested in paid search will probably do best to stick with it, then, despite rising costs.