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Search Engine Marketing Services: Trends and Predictions
By Scott Buresh (c) 2006

The search engine marketing industry is consistently evolving,
sometimes at a pace that makes it hard to believe that search
engine marketing services can stay on top of all the latest
developments. The one constant for search engine marketing
firms, and for the industry in general, is change--usually for
the better, sometimes for the worse, but almost always
significant. The industry is not for the faint-hearted or those
who abhor change. However, savvy search engine marketing firms
try to look ahead to anticipate trends. Here are my predictions
of issues that search engine marketing services will face in the
short term.

More Accountability Demanded from Search Engine Marketing Firms

Search engine marketing firms that use tactics designed to trick
the engines into showing results that aren't directly addressing
the search query will struggle, as more companies begin to look
at the larger goals that lead them to investigate search engine
marketing services in the first place. The "traffic-centric"
mindset will evolve as companies begin to demand accountability
from search engine marketing firms in terms of bottom line
increases. Ranking increases delivered by search engine
marketing services will be questioned if they do not lead to
significant traffic increases, and traffic increases will be
questioned if there is no subsequent increase in business
generated from the website. This is a good thing for quality
search engine marketing firms, since the "snake-oil"
practitioners that have given the industry such a bad name will
never be given serious consideration by any company that does
its homework in the vendor selection process.

Rising PPC Costs and Increasing PPC Frustration

As larger companies with huge budgets continue to jump into the
pay-per-click (PPC) arena, costs will continue to rise.
(Average PPC costs have increased 37% from Q1 2005 to Q1 2006 [1])
These well-funded companies will use PPC as a branding tool as
much as a sales tool, which will squeeze out many of the current
smaller advertisers. In fact, the top 10 PPC advertising
companies, based upon the number of PPC impressions, include
such names as eBay, NextTag, Vonage, Time Warner, Orbitz,
Target, and Yahoo.[2]  More large companies will continue to join
the fray, many of them throwing ROI out the window and bidding
high prices for desirable keyphrases for the sake of branding.
This means that search engine marketing firms will find small-
to medium-sized companies turning to SEO to achieve results when
they no longer can afford PPC.

Increased Interest in Organic SEO

While PPC costs rise, there is also a trend that no doubt
disturbs the engines that offer PPC programs. Sixty-six percent
of consumers "distrust" paid search ads. [3] Up to 85% of
searchers say they "tend to ignore the paid listings" [4], while
87% of commercial clicks take place "on the natural (not
sponsored) search results." [5] Three times as many marketers who
outsource the management of their natural SEO to search engine
marketing firms and who also participate in pay-per-click
advertising recognize a higher ROI from their search engine
marketing services than from PPC. [6] These facts, coupled with
the fact that Google has recently announced that it will begin
to take the relevance of pages into consideration when deciding
in what order the ads will appear (which will mean that
effective PPC campaigns will need at least some basic organic
SEO), point to one obvious result--an increase in the number of
companies that investigate organic SEO programs, whether
internally generated or provided by outside search engine
marketing firms.

Continued Reluctance from Agencies to Pursue Search Marketing

To most, it seems like a perfect fit--traditional advertising
agencies joining forces with (or purchasing outright) PPC
providers and organic search engine marketing services.
However, the average agency is scared to death of search engine
marketing services in any form (although some forward-looking
agencies have finally jumped on the search engine marketing
bandwagon). The reasons are simple: accountability and
metrics.

Advertising agencies have for years made money based upon a
percentage of what a company spends on advertising. This model
has been the accepted norm for decades. However, it raises some
ethical issues. What is the motivation for an agency to
recommend decreased spending on non-performing initiatives?
Moreover, what reasons does an agency have to report on the
effectiveness of each of its campaigns? (If an agency's clients
dug deeply into any such metrics, they would likely reduce their
advertising spend based on the performance of individual
campaigns.) Many PPC service providers have adopted this model,
even though the goal of a PPC campaign should be to monitor the
metrics of a campaign to decrease the spend (eliminating
underperforming keyphrases, for example).

Good search engine marketing services offer metrics that scare
traditional advertising agencies. If these agencies were to
present such metrics to their clients, those same clients may
start to demand similar metrics for other campaigns (television,
radio, magazine ads, etc.). Until the "percentage of spend"
model is altered, large agencies will continue to reject search
engine marketing services and will not recommend them to their
clients.

Continued Focus on Google for Organic SEO

In general, where Google goes, other engines will follow. Smart
search engine marketing services will continue to optimize for
Google, which currently accounts for half of searches in the
United States. [7] However, instead of trying to trick Google by
unraveling the latest, ever-changing algorithm, search engine
marketing firms will instead need to use the "piggyback"
approach. This approach entails learning from the extensive
studies that Google conducts of its users (learning by observing
the commonalities of the types of sites that consistently rank
highly) and applying those same attributes to client websites.
In this way, search engine marketing firms not only make sites
better for Google, but also for users. As other engines try to
close the relevancy gap in search engine results, search engine
marketing firms will be rewarded as the tactics they have used
for Google success become the accepted industry standard.

Conclusion

The use of search engine marketing services is still a new,
"unproven" channel to many companies. Even so, it is changing
the way that many traditional advertising agencies must do
business. With PPC costs on the rise, and the effectiveness of
the PPC channel coming into question, more companies will
investigate the hiring of search engine marketing firms using
organic tactics for their Internet marketing needs. Smart
companies that outsource organic or PPC advertising will no
longer say "what have you done for me lately"--they will say
"prove what you've done for me lately." Search engine marketing
services that are on top of the curve will be more than happy to
do so.

Sources:

1. Doubleclick, Performics 50 Search Trend Report
2.  Nielsen/Netratings, 2006
3.  eMarketer
4.  Marketing Sherpa study, 2005
5.  Jupiter Research, 2005
6.  iProspect
7.  La Monica, Paul R. "Yahoo, Google Search for Fans on Wall Street".  CNN.com, 14 July 2006.
<"http://money.cnn.com/2006/07/14/news/companies/yahoo_google/index.htm">

================================================================
Scott Buresh is the CEO of Medium Blue, a search engine
optimization company (http://www.mediumblue.com/). Scott has
contributed content to many publications including Building Your
Business with Google For Dummies (Wiley, 2004), MarketingProfs,
ZDNet, WebProNews, Lockergnome, DarwinMag, SiteProNews,
ISEDB.com, and Search Engine Guide. Medium Blue, which was
recently named the number one search engine optimization company
in the world by PromotionWorld, serves local and national
clients, including Boston Scientific, Cirronet, and DS Waters.
Visit MediumBlue.com to request a custom SEO guarantee
(http://www.mediumblue.com/seo-guarantee.html) based on your
goals and your data.
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