Online Advertising 60 Billion in 2010

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Online Advertising $60 Billion In 2010

By: Barry Hurd
2007-03-05

A recent article by MediaPost detailed how estimate for online advertising spending should exceed $60 billion dollars by 2010.

This was up from a previous estimate of $54 billion in projected advertising for 2010 last year. In 2006, revenues were estimated at $30 billion.

The article also says "search will account for nearly half of all ad dollars spent online."

Other bullet points of the article and covered report:

Search advertising was almost $14 billion in 2006

Keyword search advertising is the most popular online ad format, accounting for 40% of revenues, followed by display advertising (21%); classifieds (20%); referrals/lead generation (7%); rich media (6%); sponsorship (4%); and e-mail (2%).

A good point for Social Media Systems,

"Cost-per-click and CPMs have flattened in the last year due to CPCs on popular keywords reaching levels that make it challenging for merchants to hit their ROI targets, and the increasing emphasis on non-paid algorithmic search and on multiple-word queries that tend to be less expensive since there are fewer advertisers bidding on them."

So when one of our clients needs a specific phrase or keyword and we get them top results, it really does save them money. Its hard to argue with a good search engine marketing strategy when the major media players are shifting gears and following our example.

Here is another qoute that I love:

"The launch of Yahoo's Panama system in early February appears to have revved up keyword bidding on Yahoo as advertisers and search engine marketers jockey for position. For example, an advertiser that might lose a top position-since the algorithm goes from ranking advertisers on bid price only to bid price popularity-may decide to experiment with the new platform and drastically raise the bid price in order to keep a top-tier position."

So let me get this straight Google has been throwing fuel on the fire to encourage advertisers to bid up their own advertising for years, and now Yahoo has finally got on board with encouraging pay-per-click prices to sky-rocket and the whole market suffers? It is encouraging to know that the two largest search engines are promoting clients to fight against one-another. I love the fact that Yahoo and Google have done such as excellent marketing and public relations campaign that they have actually convinced a market to aggressively bid against one another and give them more money.

It may take a while, but eventually all those advertisers will realize that a competitive advertising marketplace is an extremely costly one and that most of them are creating a false "ad bubble" within each industry. Some of those industry bubbles have already popped and I expect to see many more explode in 2007.

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Tag: Social Media, Online Advertising

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About the Author:
Barry Hurd is a fifteen year veteran of online marketing and interactive advertising. As president of Social Media Systems online marketing company, he is an evangelist for emerging social technology and shares his daily thoughts on the 3net Search Engine Marketing Blog.


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