Search Engine Marketing growing

By Ekalavya B • April 12, 2007

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MediaPost reports that the entire search marketing industry is poised to grow and search spending is growing.

Jupiter Research finds that 26% percent of companies with annual revenues of $50M or more “plan to increase spending on search engine marketing by more than 25% this year.” Another 28% of those companies will increase their SEM spending by 11% to 25%.

Reasons cited for the budget increases include rising keyword costs.

"I don’t think it’s any surprise that search and rich media are driving growth," said David Rittenhouse, Group Planning Director at neo@Ogilvy. "There’s a shocking lack of interest from creatives," he adds. Harry Gold, CEO of Overdrive echoes similar views "Search is ignored by creatives, but it continues to grow for clients, and is even being used for branding.”

Well, i remember Vivek Bhargava (Communicate2) talking about how SEM Companies showcase their creativity through words and how at times words are worth a 1000 pictures at the IAMAI Digital Marketing Conference (15th March, Mumbai)

Well let us look at SEM from an Indian point of view:

Some highlights pointed out by Mahesh Murthy (Pinstorm) in the IAMAI - Pinstorm report:
Rs. 230 crores of ad spend on this media (Search Engine Marketing) is aimed at Indians alone. Of this, about a third, over Rs. 70 crores is spent by Indian companies. For an industry that barely got off the ground a couple of years ago, it’s a huge leap.

This ones not a new report and was out in September, 2006 - but is the only distinctive report out there.

I would say, companies are increasing their budgets for SEM primarily because they’ve finally begun to realize how important search engine marketing is, but Mediapost also states:
"In addition to keyword inflation, complex campaign management and methods of tracking the success of search engine marketing activity continue to elude marketers…"

Well SEM is definitely catching up in India and here are a couple of more interesting points from the IAMAI Report:

There are 90 Indian brands that spend more than Rs. 10 lakhs a year in India on SEM.
The total no. of brands that spend more than 10 Lakhs a year in India on SEM was pegged at 291.

..and mind you this was in September, 2006.
I’m quite sure this number would be easily doubling soon - or perhaps would have already done so!

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