Definition Edit

In search advertising, an advertiser bids, via an ongoing auction process, to have his or her ad displayed when a consumer types a query into a search engine using a given keyword. Advertisers generally pay only if a consumer clicks on their ad.

Overview Edit

The search market is dominated by Google and Yahoo! (now in a partnership with Microsoft, which has the Bing search engine).

Search advertising, which did not exist a decade ago, now has about 4% of the overall ad market and accounted for 47% of the digital ad market in the second quarter of 2009.[1]

The advantage of search advertising is that it allows advertisers to target individual consumers who are actively looking for a certain product or service. Using data generated by searches, advertisers can further refine ad campaigns to deliver additional, relevant ads to individuals based on their previous searches. Google had 64% of the search market in August 2009,[2] but faces new challenges after a July 2009 announcement by Microsoft and Yahoo! that they have formed a partnership on Internet search, under which Yahoo! will use Microsoft’s Bing search engine.[3]

As search advertising has become more prominent, it has spawned a cottage industry of analysts and media buyers who help businesses navigate the online auction system.[4] One strategy, search engine optimization, describes the practice of companies configuring their websites to have the attributes search engines are programmed to seek, giving them a better chance of appearing in an organic list of search results. To accomplish this, consulting firms try to figure out the algorithms large search firms use in their auctions.

References Edit

  1. PricewaterHouse Coopers and Interactive Advertising Bureau, IAB Advertising Revenue Report, 2009 Second Quarter and First Six Months Results 2 (Oct. 2009).[1]
  2. comScore, “comScore releases August 2009 U.S. Search Engine Ratings." (Sept. 22, 2009).[2]
  3. Associated Press, “Microsoft, Yahoo Announce Search Deal” (July 29, 2009).[3]
  4. Steven Levy, “Secret of Googlenomics: Data-Filled Recipe Brews Profitability,” Wired, May 22, 2009.[4]

See also Edit

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