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looking ahead to search September 29, 2008

Posted by nicholas gill in search.
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For a recent pitch, we were asked this question: “what trends do you see emerging in PPC in the next 5 years?”

Significant increases in spend

The major trend is that spend in search will soar over the next five years with total European spend topping €8.1 billion by 2012 and growing in line with the pace of online marketing spend as a whole as brands move toward more measurable and efficient forms of customer communications.

Specifically for the UK, the 45% growth between 2005 and 2007 will slow but still represent a 28% growth to 2012 representing a €2.8 billion market and leading Europe as the most advanced search market.

The growth of mobile

Mobile search will become a significant factor in search as mobile internet penetration increases to 38% by 2012 based on technology advances and improving access speeds. The introduction of the iPhone and Nokia N95 handsets are starting to accelerate this nascent opportunity and in the US, 6 out of 10 users made searches using their mobile in January 2008 alone. Mobile search provides many opportunities, not least of which are geo-targeting opportunities. Ensuring the destination from the click is mobile-ready is also an important consideration.

Search viewed as complex, inhibiting innovation

From an attitudinal perspective, there is a shift toward ensuring greater integration, co-ordination and consistency across the marketing mix, delivering prominence to the role of search in the consumer journey. There is also a fear that search will become more complicated (nearly 90% either agree or strongly agree with this statement) which is inhibiting how brands are incorporating new approaches to search marketing with under 30% driving innovation.

Financial services surprisingly have low commitment to search

From a vertical perspective, only 44% of financial services firms are currently using search marketing, with 29% having no plans at all to use it. This places any pioneering brand in a strong position with the majority of consumers preferring search as their starting point for financial services providers.

Visual search and niches will both augment and fragment

While today text and sites are important in the search results, increasingly multimedia will be the result of search: video, images, audio. Google are already implementing this activity and this is expected to increase.

Search will also fragment into horizontal planes, for example, Spock allows you to search by people, globrix allows you to search properties.

Conversational search and sentiment is niche at present but already services such as Summize for Twitter are gaining prominence and allow users to understand what other consumers are saying about brands and products in near real-time removing the need to trawl forums and advice sites.

Visual search services such as searchme or AT&T Pogo will gain attraction by showing the actual results visually, a la iTunes coverflow artwork, attracting users who have a higher visual preference than the current standard of text results.

Social search will drive relevancy and consumer trust

Social search on social networks such as Facebook, MySpace, linked In etc. will become more valuable to users because of relevancy and their inherent higher trust in consumer, particularly peer, reviews of places, people and companies than from brands themselves. 90% of consumers trust recommendations from other consumers compared to 45% from a TV ad. Augment this with the fact that 44% of users would abandon a financial services purchase due to negative user generated comments and positive opinion and increased use of social search become increasingly important. Combining search and peer advice will become more important than contextual listings and vertical search.

Industry consolidation cannot be at the cost of local relevancy

From an industry perspective, there will be even more consolidation into global networks as multinationals look for more consolidated control and global consistency, e.g. to avoid country managers from bidding against each other. What this detracts from though is the need for search services to be local; requiring an innate understanding of how local consumers will ask for things and how search is used in relevant context.

Sources: Forrester, eMarketer, OfCom, Yankelovich.

Twitter | Facebook | LinkedIn |nr_gill@hotmail.com

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