Thoughts from the Shelf

A recent survey conducted by Digital Media firm Guava on trends of the 2010 UK search industry, added weight to the general coconscious that in the aftermath of the tough financial climate in 2009, businesses are looking to expand their search budgets for SEM and take a cautious step towards Social Media Marketing.

A copy of the 2010 search trends report is available from the Guava site.

Paid Search Services:

Keyword research still leads the list of paid search activity with 77% of clients actively researching keywords prior to running paid search campaigns. A worrying statistic, leaving 23% of businesses are relying on other means to establish a paid search strategy.

Up 10% and 11% respectively was contextual advertising and competitor research as advertisers look to exploit gaps in an increasingly competitive market place and look to utilise new, cheaper mediums for paid search display.

Organic Search Services

Again keyword research topped the charts with 69% of companies researching terms before they create an SEO campaign. Surprisingly this was up 12%, suggesting in a tough financial climate, businesses are becoming more aware of the benefit of putting long term SEO strategies in place.
Social media consultation was an activity only 35% of people sought, suggesting the ineffective way of measuring an ROI on social media platforms is preventing businesses from committing reduced budgets to social media projects.

That said social media marketing was one area of the search market that record substantial growth with 59% of companies partaking in social media marketing in 2010, up 25% on 2009.
Interestingly the local search market has reached a plateau, even with Google’s quest for both personalised and regionalised search results. Shopping comparison site also saw a reduction of 1%, down to 26%.

The hard times are over

With 60% of companies looking to increase their organic search budget in 2010 and 52% their paid budgets, we are moving into a period where both markets will become increasingly competitive.
With 49% and 22% of companies intending to spend over £50k in 2010 on paid and organic search respectively, and more importantly significantly more are looking at medium budgets above £5k, it’s clear that businesses are looking to further expand excising organic search strategies. Could this be that they have proved a welcome safety net in hard times and businesses are waking up to their true value, especially in lean times where paid search budgets are pruned.

Objectives

72% of companies do still however look at SEO as a means to drive traffic to a website. With 54% of companies partaking in paid search looking to convert directly into direct sales, it seems that there is a misconception about how valuable target organic traffic can be to a site. With a typical conversion rate 50% higher than paid search, businesses still regard ‘free organic traffic’ as a ‘catch all’ as opposed to targeted sales generation tool.

This is again very different for social media where a huge 72% of companies see social media projects as nothing more than a brand building exercise. Again it seems the harsh reality of not being able to determine and ROI is preventing companies from viewing social media as a credible medium for sales generation.

Poorly converting websites and lack of internal resource is still the biggest barrier to paid and organic search marketing. For social networks 43% of retailers deem measuring success as the biggest hurdle to committing budget to the medium.
Conclusion

There is no surprise that Twitter and Linkedin have recorded impressive growth rates over the last twelve months, up 32% and 14% respectively and the continued growth of Facebook is also up 13%. Compared to the decline of social bookmarking sites Digg, Delicious and Wikipedia, down 8%, 7% and 6% respectively, a trend is developing in social media where users are requiring increasing levels of interactivity online.

The success of the Facebook plug-in and its integration into many ecommerce sites suggests added interactivity is the way users want shop online, effectively connecting with social networking sites whilst visiting different retailers. With one constant profile across the web, users are embracing the ability to recommend products and shop whilst connected to a social network.