Search Overview
Introduction
When it comes to offering companies the most bang for their advertising
buck, Internet search is hitting the mark.
With the Web now a major hub for shopping online, savvy marketers
are turning to Internet search to tap the purchasing power of
more than 200 million online consumers. The ability to reach interested
consumers who pre-qualify themselves by actively looking for specific
products or services is a key advantage that helps companies market
in a cost-effective manner and increase their return on investment
(ROI).
Far more effective than flashy banners that spanned the Internet
in its earliest stages, search has become one of the hottest sectors
within the online advertising industry, marked by rising consumer
and advertiser adoption, technological advancement, and sizeable
growth potential.
Now, a $1.4 billion market, Internet search and related services
is expected to climb to $2.6 billion in 2004, with 20-percent
plus annual growth through 2008, according to Salomon Smith Barney.
Indeed, no other online advertising category is growing as fast.
Search Industry and Competition
To meet growing demand from cost-conscious advertisers in a tight
economy, different forms of Internet search are available, including
editorial and algorithmic, as well as paid placement and paid
inclusion. Providers of these search services are looking to connect
with about 60 million households, or 90 percent of the Internet
population, that use " Web search services monthly.1
Internet search has not only advanced the way companies are marketing
products and services, but also fostered innovation with respect
to how providers are capitalizing on the market opportunity. Some
have created technology in-house to address search needs, while
others have aligned with partners to tackle key objectives such
as returning quality, up-to-date search results. Here's a look
at today's search landscape:
In editorial search, providers such as MSN will present listings
that are handpicked by their editorial staff. Editors' picks are
driven primarily by the quality of individual sites, so businesses
are growing more focused on making sure the content is current
and engaging.
Algorithmic search engines, meanwhile, use "crawling" technology
to create an index of Web pages. This index is searched when a
user enters a query that, in turn, generates search results. Algorithms,
including Google, FAST and Inktomi, are primarily based on keyword
matching and link popularity. In recent years, search engine optimizers,
or SEOs, also have emerged to help marketers optimize their Web
pages and increase their chances of being included in search results.
To help businesses boost visibility with consumers, paid search
channels are becoming an increasingly attractive option for many
advertisers seeking more control over their spending per lead,
as well as the placement of each listing.
Under the paid inclusion model, advertisers set up an account,
submit listings and pay a fee to be reviewed by the algorithm.
However, there is no guarantee the listings will always be included
in the search results, or where they might be ranked on a given
page. Still, paid inclusion helps increase relevance of results
by allowing search engines to crawl deeper into businesses' Web
sites and onto areas previously indexed only via spam techniques.
As a result, individual Internet users are given access to better
quality search listings.
In paid placement, advertisers pay to receive premium placement
within the search results listings. For example, at Overture,
advertisers bid for placement in its search results and only pay
the company when a consumer clicks on the advertiser's listing.
Following a rigorous screening for relevance by Overture's editorial
team, the company then distributes its search results to thousands
of Web sites across the Internet, including popular destinations
such as MSN, Yahoo! and Lycos.
Rapid success of the paid placement search model pioneered by
Overture has lent itself to increased progress -- and competition.
The push to provide marketing services comes as more advertisers
embrace the medium and seek a greater stake of e-commerce territory,
both in the U.S. and overseas. The paid placement search market
is expected to grow to $3 billion by 2004 and $6 to $8 billion
by 2007/2008, up from $1 billion in 2001, according to Overture
estimates.
Overall, as the Internet search sector expands, most search engines
and portals are employing a mix of editorial, paid inclusion and
algorithmic methods to meet diverse needs of their users and better
monetize search pages. For example, portals such as Yahoo! and
MSN provide a composite search page by combining various search
options.
Search and Direct Marketing
As a direct-response channel, Internet search comes with many
built-in benefits that provide online marketers an attractive
mix of message control, consumer targeting and conversion-tracking
capabilities. In general, search comes with four distinct advantages
over traditional direct mail that marketers find hard to resist.
First, a tremendous effort goes into defining the target audience
and mailing lists when launching a direct-mail campaign. Search,
however, reverses this process as the consumer finds the marketer
by actively looking for his or her specific product or service,
thereby creating a pre-qualified lead.
Second, in terms of creative, design and messaging, direct marketers
must continuously spawn breakthrough packaging and copy for each
mailing. In search, marketers simply identify keywords relevant
to their businesses and create descriptions for their product
and service offering.
A third advantage is that marketers can track success rates in
real-time with Web-based tools; whereas in direct mail, performance
is often hindered by traditional phone and "snail-mail" tracking.
A final point of differentiation is pricing and cost control.
With direct mail, costs are incurred before a single lead is generated.
In many forms of search, however, a marketer only pays after a
consumer clicks through to their Web site at a price the marketer
decides the lead is worth.
While search can be a powerful, stand-alone marketing tool, it
is best used as a compliment to an advertisers other direct marketing
programs - both online and off.
(Source: Overture.com)
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