The value of search engine marketing in Europe
According to Forrester Research, in Europe the search engine market will generate 1.4 billion Euros of spending in 2005. The definition “search engine marketing” includes everything related to commercial search: paid listings, contextual search, site optimization, and paid inclusions. While search marketing’s share in online advertising will increase for another two years, Forrester believes it will start decreasing in 2007. The slowdown will be due to a probable increasing negative attitude of consumers towards paid listing, but also to the growth of rich media ads and the increase in the price of keywords.
Hellen Omwando, Consumer Markets Analyst at Forrester Research, says:
“While it’s unlikely that prices in Europe will reach the same levels as in the US — where the same keyword might command five times the price than in Europe — increases will be significant enough to make it difficult for some marketers to justify the ROI of high prices; they won’t be able to compete for popular keywords.”
The Forrester estimation is not correct, almost for some countries like Italy and Spain that are *significantly* underestimated. In Italy, for examples, IAB figures (very conservative on paid search) officialy reports numbers that are 400% higher than Forrester. It’s strange that Forrester takes IAB as source but only in some countries… I wrote to the analyst who realized the research and she told me that numbers will be revisited fall this year.
Mauro, thanks a lot for sharing this with us!