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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