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SEMPO 2011 State of Search Marketing Report Estimates Industry to Grow from $16.6B in 2010 to $19.3B in 2011

Facebook becomes major player in PPC campaigns; Mobile internet, local search are most significant trends impacting industry

Wakefield, Mass., April 13, 2011 – SEMPO today announced results of its 2011 State of Search Marketing Report. With over 900 companies and agencies participating in the global online survey conducted by Econsultancy, the report estimates that the North American search marketing industry will grow by 16% in 2011 to a value of $19.3B, up from $16.6B in 2010.

A significant percentage of companies are now using Facebook. Just under half of respondents say they use Facebook for pay-per-click (PPC) campaigns – 47% in North America and 45% outside the US and Canada. The rising popularity of Facebook is even more apparent within agencies. Nearly three quarters of North American agencies (74%) and two thirds of those outside the U.S. and Canada (69%) say their clients use Facebook.

The rise of the mobile internet is the trend which is having the most impact on search marketing, according to the survey. Local search is the next most significant trend, yet primarily from the perspective of agencies. Respondents also indicated the growing importance of behavioral targeting. The number of companies doing SEO, paid search and social media in-house, has decreased, with more marketers seeking help from service providers.

"The healthy growth reported for the industry in 2011—surpassing the 14% growth in 2010—is gratifying,” commented SEMPO president Chris Boggs. "The industry is evolving to encompass much more than the search engines. The increasing role of social media is re-shaping the industry in surprising ways.”

Other top findings include:

Mobile internet

  • 40% of company respondents said that the growth of the mobile internet was "highly significant", an increase from 26% last year. A further 39% said it was "significant".  
  • Agencies are feeling the impact of the mobile internet even more strongly, with almost half of supply-side respondents (47%) describing its impact as highly significant.

 Local search

  • The next most important trend is local search, according to agencies. Forty-three percent (43%) of supply-side respondents said this was highly significant. A further 41% say that it is significant. According to agencies, 34% of client search budget is spent on local PPC advertising (i.e. at a regional, city or sub-market level).
  • Client-side advertisers are not yet affected by local search as much as their agency counterparts. Only 26% of company respondents say that the impact of local search has been highly significant. Local, on average, represents just under a quarter (23%) of client-side search budget, which is significantly less than the agency average (34% of client budget).

Use of social networks, including Facebook, Twitter and LinkedIn

  • Beyond PPC, the percentage of companies using Facebook more broadly for promoting themselves now stands at 84%, up from 73% last year.
  • Three quarters of companies (75%) use Twitter to promote their companies or brands, while 52% use business networking site LinkedIn. More than a quarter of North American companies now run PPC campaigns on LinkedIn.

More companies outsourcing SEO, paid search and social media

  • Only 44% of companies are now carrying out search engine optimization in-house, compared to 51% last year.
  • Only 38% of companies are doing paid search marketing in-house compared to 47% last year.
  • Only 55% are doing social media marketing in-house, compared to 62% last year.

Behavioral targeting

  • The proportion of company respondents who say that behavioral targeting is highly significant or significant now stands at 78%, up from 68% last year. 

This year’s annual SEMPO study – now in its seventh year – is an aggregation of information provided by organizations from 66 different countries, from marketers across a range of business sectors and types of agency.

"Once again the SEMPO survey has collected a rich set of data that provides valuable industry perspective and insights as seen through the eyes and dollar investments of both advertisers and agencies,” said Marc Engelsman, VP Client Programs and Services at Digital Brand Expressions and the lead for this SEMPO initiative. "All marketers, not just search marketers, should want to leverage this information as they look to improve the performance of their digital engagements.” 

"A mature industry maintains a balance between today and tomorrow,” said Stefan Tornquist, U.S. Research Director at Econsultancy. "Search engine marketers have learned how to roll with algorithm shifts and price increases and are constantly improving their efficiency. At the same time, they're taking the time to focus on the emerging opportunities where search, social and mobile meet."

The report is based on an online survey, conducted in February and March 2011, which SEMPO and Econsultancy promoted to their respective members and to search marketing professionals. A complimentary copy of the report is provided to SEMPO members and those who participated in the survey. A total of 920 total respondents from 66 countries took part, including 325 advertisers and 595 agencies or consultants conducting search marketing on behalf of clients.
To obtain a copy of the SEMPO 2011 State of Search Marketing report, visit: www.econsultancy.com/reports/sempo-state-of-search.

About Econsultancy
Econsultancy is a community where the world's digital marketing and e-commerce professionals meet to sharpen their strategy, source suppliers, get quick answers, compare notes, help each other out and discover how to do everything better online. It was launched in 1999 and since then has grown to a dominant position in the digital marketing industry with more than 100,000 members worldwide. Its website and blog attracts more than 300,000 unique users per month and its range of training courses and conferences are attended by more than 5,000 marketers every year. For more information, visit www.econsultancy.com or follow @econsultancy on Twitter.

About SEMPO
SEMPO is a global non-profit organization serving the search marketing industry and marketing professionals engaged in it. Its purpose is to provide a foundation for industry growth through building stronger relationships, fostering awareness, providing education, promoting the industry, generating research and creating a better understanding of search and its role in marketing. SEMPO includes thousands of professionals across 50 countries. The organization’s mission is to represent the common interests of companies and consultants worldwide and provide them with a voice in the marketplace. SEMPO's education and outreach initiatives are funded in part by Google, American Express Open SearchManager, and Baidu, and supported through partnerships with SMX, SES, OMS, and MediaPost. For more information or to join the organization, visit www.SEMPO.org.

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