Paid Search: 12% Year-Over-Year Growth in Q2 2011

According to IgnitionOne’s “US Online Advertising Report” for the second quarter of 2011, U.S. online advertising spend in the second quarter showed strength across all channels despite larger economic uncertainties.

U.S. paid-search advertising spend grew 12 percent year-over-year in the second quarter, according to IgnitionOne. It was flat with the first quarter of the year.

However, the company notes that while the quarter began strong, it dipped sharply in June, possibly foreshadowing what’s to come in future months. IgnitionOne notes that its expectations for the third quarter are cautiously optimistic.

Search spend was particularly strong for retailers, who spent 34.7 percent more year-over-year. The travel sector, however, displayed a decline in spend of 7.5 percent year-over-year.

Google boasted 80.8 percent of U.S. search advertising spend, while Yahoo/Bing held 19.2 percent of the market.

In the second quarter, Google’s impressions rose 12.8 percent year-over-year, while Yahoo/Bing’s rose just 1.4 percent.

Google’s clicks rose 17.6 percent, while Yahoo/Bing’s rose 3.6 percent. Meanwhile, Google’s spend rose 17.7 percent, while Yahoo/Bing’s declined 7.7 percent.

Google’s click-through rate rose 4.2 percent, while Yahoo/Bing’s rose 2.3 percent. Google’s cost per click remained unchanged, while Yahoo/Bing’s declined 10.9 percent. Also, Google’s eCPM rose 4.3 percent, while Yahoo/Bing’s declined 8.9 percent.

According to IgnitionOne, Google’s AdEx real-time bidding platform had a strong second quarter on a year-over-year basis, with impressions surging 313.5 percent, spend increasing 228.9 percent and CPM declining 20.5 percent.

Yahoo’s Right Media Exchange saw its impressions fall 42.4 percent, spend decline 44.7 percent and CPM fall 3.9 percent.

“Share of RTB display spend is now almost evenly split between the two dominate players, with Google at 51% share and Yahoo! at 49% share,” according to IgnitionOne.

Facebook advertising had a notably good second quarter on a year-over-year basis, with spend up 22 percent on a same-client basis and impressions up 11 percent.

“However, Facebook advertising has experienced high rates of growth due to new marketer adoption in the past year, which contributed to a 280% increase in spend across all clients and 200% increase in impressions YOY,” notes IgnitionOne.

The company also notes the volatile spending patterns for Facebook advertising, spotlighting the medium’s immaturity.

Source:

http://www.ignitionone.com/pdf/IgnitionOne-Q2-2011-US-Online-Advertising-Report.pdf