SES: Search Engine Marketing Heading Up Forecast Says

    August 8, 2005

With the SES: San Jose starting today, JupiterResearch, a division of Jupitermedia put out its online advertising forecast for 2005 as one of the first pieces of information from the conference. The forecast predicts online advertising will continue its growth well into the future.

Talk about this and all the other latest news getting piped out of SES: San Jose and straight into the WebProWorld’s forums.

According to their study, online advertising will continue to grow over the next five years hitting $18.9 billion in 2010 more than doubling the 9.3 billion at the end of 2004. They concluding this reflects not only the advertiser confidence but the strength of the medium itself.

They predict search engine advertising will generate more revenue than standard display advertising by 2010. The reason for that move is due to the difference in compound annual growth rates.

JupiterResearch Senior Analyst Gary Stein explains the surge in search engine advertising, ”There is phenomenal momentum behind search engine advertising. The number of advertisers using search to market products continues to grow, as does the overall efficiency of the market – search engines are getting even better at making money off search engine results pages.”

While the search engine aspect of marketing is important, Jupiter said it’s just one element of an growing online ad market. They said other ads will experience growth in the coming years. They mentioned classified will grown 10% reaching $4.1 billion but 2010.

They also predict the ads will be much stronger with the advent of broadband combined with streaming video. Rich media spending will grow at a 25% compound annual growth rate $3.5 billion and streaming media will grow at a 30% compound annual growth rate to $943 billion by 2010.

Another important point they mention is that publishers will see revenue growth in several areas including direct sales and network revenue-share deals. They predict that ads this year based on performance will climb past the impression based ads. The primary reason comes from increased use of targeting technology.

”Publishers are in a good position right now,” noted JupiterResearch VP and Research Director David Card. ”Not only can they monetize their non-premium inventory, but they can strategically choose the network providers they feel can generate the most yield from that inventory,” added Card.

All in all, this isn’t terribly surprising news. The Internet and search engines more specifically provide 24-7 advertising anywhere in the world, literally. Traditional advertising means are certainly effective but clever, effective ads on the Internet can reach an even more targeting audience, perhaps even more so than trade journals and at the very least on their level. The beauty is that marketers will be able to hit much broader scales and if the forecast by Jupiter are anywhere even close, then marketers, advertisers and pr firms will have a lot more work ahead of them.

Talk about this great new information and all the other latest news coming out of the SES: San Jose at WebProWorld’s special coverage discussion.

John Stith is a staff writer for WebProNews covering technology and business.