02 pruitt optimization2008

Search Engine Marketing (SEM) Trends and The Future of Search in North America

Ashmanov and Partners Conference 2008

Jeffrey PruittiCrossing Executive Vice President, Search

SEMPO President

“Search and Search Engines are the collective

consciousness of today’s World giving equal access to

anyone, anywhere.”

The Gold Rush

Level the Playing Field

COPYRIGHT ICROSSING / PROPRIETARY AND CONFIDENTIAL 5

Optimization.ru Conference 2008 | Moscow

Internet Connection: Anyone, Anywhere at Anytime

Equal Opportunity

Your Choice

Agenda

• A New Digital Paradigm for Brand Success

• Search: Past and Present

– Search Marketing Statistics

• Search is Evolving

– Digital Asset Optimization

– Performance Media

• Digital Agencies

– How organize for trends in search

Always-on Network



Network of Human Beings



Brands need a new model to be successful

Creating connected brands.

Brands must be aware of their world - using

their “senses” to understand their

environment, especially their

customers.

Brands must live in their

networks, always-on, agile and adaptive –

they must participate and

engage with their customers.

Brands must behave in ways

that are authentic, and

earn the trust of it’s customer.

Brands must contribute to

their networks, providing tools

and content that are relevant.

Aware Active TrustedUseful

Agenda


• Search: Past, Present & Future









Source: eMarketer,,US Online Advertising Spending,Report, October 2008

0

5

10

15

20

25

2001 2002 2003 2004 2005 2006 2007 2008 2009* 2010* 2011* 2012*

Sp

en

din

g (In

bil

lio

ns)

Year

Search

Display

Classified

Rich Media

Email

$3.85b (38%)

$10.78b(42%)

U.S. Online Advertising SpendingTotal Dollars in Billions by Format, 2001 - 2012

* Projected

PAST $19.65b(47%)

FUTURE

$0.25b(3%)



Source: eMarketer,,US Online Advertising Spending,Report, October 2008

-50%

0%

50%

100%

150%

200%

250%

300%

2001 2002 2003 2004 2005 2006 2007 2008 2009* 2010* 2011* 2012*

Year-O

ver-Y

ear

Ch

an

ge (P

erc

en

t)

Search Display Rich Media Email

U.S. Online Advertising SpendingYear-over-Year Percent (%) Change by Format, 2001 - 2012

PAST FUTURE



U.S. Advertising SpendingTotal Dollars in Billions by Media Type, 2001 - 2007

$0

$10

$20

$30

$40

$50

$60

$70

2001 2002 2003 2004 2005 2006 2007

Sp

en

din

g (In

bil

lio

ns)

Internet*

Radio

Outdoor

Magazine

Newspaper

Television

* Internet includes yearly totals for Display, Paid Search and Natural SearchSources: eMarketer,,US Online Advertising Spending, Report, October 2008;

TNS Ad Spending by Media Report, 2001 - 2007



U.S. Advertising SpendingYear-over-Year Percent (%) Change by Media Type, 2001 - 2007

* Internet includes yearly totals for Display, Paid Search and Natural SearchSources: eMarketer,,US Online Advertising Spending, Report, October 2008;

TNS Ad Spending by Media Report, 2001 - 2007

-10%

0%

10%

20%

30%

40%

50%

60%

2001 2002 2003 2004 2005 2006 2007

Ye

ar-o

ve

r-ye

ar

ch

an

ge

(p

erc

en

t)

Internet*

Radio

Outdoor

Magazine

Newspaper

Television



Annual Advertiser Spend ForecastBy Vertical, 2007-2012

Source: Forrester U.S. Interactive Marketing Report, 2008



Organic SEO Most Popular of SEM ProgramsBy Advertiser Respondents, 2004-2007

Source: Search Engine Marketing Professional Organization survey of SEM agencies and advertisers, December 2005. Global Results. Copyright © 2005

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2004 2005 2006 2007

Ad

vert

isers

En

gag

em

en

t (P

erc

en

tag

e)

Year

Organic SEO

Paid Placement

Paid Inclusion



Rank

2006 2005

Agency Headquarters SEO/SEM Revenue

2006 2005

Percent Change Number of Employees

1 2 iCrossing New York $63m $46m 37% 350

2 7 Avenue A Seattle $30m $12m 156% 1800

3 5 360i New York $28m $19m 48% 175

4 NA Website Pros Florida $25m NA 22% 700

5 NA DoubleClick/Performics

Chicago $24m NA 58% 242

6 NA Leapfrog Illinois $21m NA NA 85

7 6 Efficient Frontier California $20m $13m 96% 140

8 3 iProspect Boston $16m $23m - 30% 115

9 8 Impaqt Pittsburg $14m $11m 18% 87

10 10 Acronym Media New York $12m $10m 20% 65

Top 10 Search Marketing Agencies2005-2006

Source: Advertising Age DATA Center, Top Search Marketing Agencies Fact Pack, 2006, 2007



Current Economic Condition

“91% are using online advertising, and over one-half (+50%) indicate that their companies plan to maintain or exceed current levels where possible”

Source: eMarketer, U.S. Online Advertising Spending, Report, October 2008

“55% of marketers said they’re cutting expenditures on traditional media, precisely in order to increase funding for online efforts”

According to a McKinsey & Co. survey of 340 senior marketing executives worldwide…



Current Economic Condition

The Internet…• Is inherently more measurable and

accountable than are traditional channels

• Allows for better, more-granular targeting

• Is interactive, thereby allowing for a higher degree of engagement

• Is accounting for a larger share of total media time

• Plays into the consumer-in-control movement

• Provides marketers with the potential to gain rich insights into consumer behavior

• Allows marketers to reach prospects throughout the entire consumer buying cycle

“In the recession of 2009, marketers will be making cuts almost across the board, and will seek safe harbors and cost efficient alternatives.”

- Jack Myers,

Media Business Report

Source: JackMyers Media Business Report, October 13, 2008

What is behind the bullish projections for online ad spending?

Agenda









Digital Asset optimization

Platform

Content

Digital Asset Optimization



Google Universal and Ask3D

Search engines are now integrating multiple media types in the results pages, including:

– Video– News – Blogs– Images– Maps



Google Universal Search and Video Ads



Search and Social Impact



Purpose of Search Engine Marketing Use

"What is your company using search engine marketing to accomplish?"

Source: Search Engine Marketing Professional Organization survey of SEM agencies and advertisers

Brand, Sales, Leads and Traffic Are Top Objects of Paid Placement Programs Among Advertisers



Methodology: Testing the Brand’s Placement

1. Control• (No branding: “Honda” does not appear on the SERP)

2. Side Sponsored• Honda appears in side sponsored result only

3. Top Organic• Honda appears in top organic result only

4. Top Sponsored• Honda appears in top sponsored result only

5. Top Sponsored and Top Organic• Honda appears in both top Sponsored and top organic

results

Subjects entered an unbranded query and saw one of the following search engine results pages (SERP):

Source: Enquiro Search Solutions, Inc., July 2007.



A 2.2x Lift in Aided Brand Recall When Brand Is in Top Sponsored and Top Organic Results

Which of the following brands do you remember seeing in the search results page you just viewed?

Side Sponsored

TopSponsored

Top Sponsored & Top Organic

Top OrganicListing

2.2x

1.5x

x

Test Brand

Other0%

10%

20%

30%

40%

50%

60%

70%

Source: Enquiro Search Solutions, Inc., July 2007.

Query: Unbranded (i.e., “fuel efficient cars”)

Performance Media



Advertising Platforms

• Ad Platforms include: Panama, Google Adwords, AdCenter

• The digitization of all content will lead to new advertising methods across multiple forms of content.

• Advertising platforms will be utilized to manage cross channel campaigns “Performance Media”

One Stop Shop Ad PlatformCentralized Search Driven Media



Buying Search and Contextual Ads (past)

Media Buyer



Buying Search and Contextual Ads (present)

AP

I

Bid Management

ToolMedia Buyer

AP

IA

PI

Examples:• - Blondinka.ru• - SmartContext.ru• - iCrossing’sMerchantize



Buying Display Ads (today)

Media Buyer

Ad Network



Buying Display Ads is about to get easier!

AP

I

3rd Party AdManagement

& Serving Tool

Yahoo - RightMedia

AP

I

Google - Doubleclick Network

AP

I

Microsoft - AdECN

Networks, Exchanges and APIs

Media Buyer



+

AP

I

Cross MediaBid/Buy Tool

Media Buyer

AP

IA

PI

3rd Party AdManagement

& Serving Tool

Bid Management

AP

IA

PI

Ad Exchanges

=

RadioTVPrint

DisplayVideoExchanges

Search

Performance MediaBuying Search, Contextual, Display Ads & Video



One Stop Shop for all Search Driven Media

Ad Networks | Ad exchanges

API’s

Bid Management System

Convergence of Search and Display



Performance Media(CPA/CPC)

Convergence of Search and Display

Search DisplaySite Targeting

Contextual

Exchanges

PAST Branding(impressions/CPM)Performance

BrandingNOW

Credit Band of Moscow: Convergence of Search and Display

Case Study: Dove®



DOVE Campaign Assets

Click to Play Video

Flash Banner

Text Ad

Source: comScore / Nielsen NetRatings

®



DOVE Nielsen//NetRatings: Sales Impact

• 96% new buyers entered the Total Brand

• +25% more dollars spent on the Total Brand

• Incremental dollar impact to the Total Brand was significant, (for every $1.00 invested with Google, consumers spent an incremental $1.43)

$$ $

Source: comScore / Nielsen NetRatings

®

Agenda











Program Management

ResearchExperience

PlanningOptimize Advertise

Integrating the digitization of all content

PROGRAM MANAGEMENT



Digital Agency Strategic Model



Multi-Channel Reporting



Multi-Channel Conversion Funnel

“ The digitization of all content will lead to new

advertising methods across multiple forms of

content. As the Engines develop these new products

and media types, it is imperative that Search Engine

Marketers stay in lock step with the engines in our

technology integration and service line expansion ”

Jeffrey PruittExecutive Vice President, iCrossing

President, Search Engine Marketing

Professional Organization (SEMPO)

1.480.505.5807 direct

1.602.430.0640 mobile

[email protected]

iCrossingwww.icrossing.com

SEMPOwww.sempo.org

Thank you

02 pruitt optimization2008

Documents

paid search

search engines

brand success search

natural search sources

search sempo president

us online advertising

media report

tnsad spending