The Search Engine Marketing Professional Organization (SEMPO) has shared the results of its annual State of Search Marketing Report. WebProNews talked about the findings with SEMPO’s outgoing president Sara Holoubek at the Search Engine Strategies conference in New York (more exclusive interviews from the conference can be viewed here).

Holoubek tell us that they had a record number of respondents this year. "Almost 1,500 people from across the globe in 68 countries answered the survey, she says.

The report estimates that the North American search engine marketing industry will grow 14% from $14.6 billion in 2009 to $16.6 billion by the end of 2010.

The report also indicates that measuring ROI is the biggest challenge facing marketers this year in all three key search tactics covered in the survey – SEO, paid search, and social media marketing. Additional findings include:

– Around half the companies (49%) are reallocating budgets to search engine marketing from print advertising. More than a third (36%) are shifting money away from direct mail, and almost a quarter are moving budgets from conferences and exhibitions (24%) and web display advertising (23%).

– The research highlights Google’s dominance as a search engine, with 97% of companies paying to advertise on Google AdWords. Nearly three quarters of companies (71%) pay to advertise on the Google search network while 56% use the Google content network (keyword targeted).

– More than half of advertisers (56%) and agencies (62%) say that Google keywords have become more expensive over the last year. Meanwhile, only around a third of advertisers noted an increase in Yahoo (32%) and Bing (29%) keyword costs.

– From a range of trends and marketplace developments, company respondents are most likely to say the personalization of search results is having an impact. Just under a third of companies (31%) say this is "highly significant," and a further 44% say it is "significant." Agency respondents felt the "rise of local search" was the most significant emerging trend with 38% saying this was "highly significant" with 47% labeling it as “significant."

SEMPOs findings suggest tha the rise of social media budgets, while still modest in comparison to EO and paid search, represent the "biggest opportunity" for search marketers in 2010.