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Covario Study Finds Holiday Season Pushes Global Search Ad Spending by Tech Firms Slightly Above Expectations for 2011

PPC Spend Grew 21 Percent Annually and 28 Percent for the Quarter Over 2010, While Cost-per-Click Inflation Abated (January 04, 2012)

SAN DIEGO, CA -- (Marketwire) -- 01/04/12 -- Covario, Inc., the nation's largest independent provider of search marketing agency services and SEO software solutions, today issued its Global Search Spending Analysis, reporting that spending for paid search advertising by the firm's high-tech and consumer electronics clients increased 21 percent in 2011 over the previous year -- slightly above the company's original expectations of 15 to 20 percent growth for the year.

The quarterly Covario study found that robust holiday PPC (pay-per-click) advertising in the consumer electronics sector led to a fourth quarter rise of 28 percent in search spending compared to the fourth quarter of 2010. Global search spending in the fourth quarter was also up 7 percent over the previously strong third quarter of 2011.

Among the major search engines, Google continued to dominate the paid search scene in 2011 with global market share of 76 percent (down 2 percent from the prior year), with annual spending growth of 27 percent over 2010. Global paid search spend on the integrated Bing/Yahoo platform was down 18 percent from the prior year. Baidu, which dominates the Chinese market and the Asia/Pacific region as a result, stood out with annual growth of 185 percent over 2010.

Looking at the global cost competitiveness of the seven largest search engines, Covario CEO Russ Mann noted that the fourth quarter of 2011 was the first time since mid-2010 where the trend toward higher CPCs (cost-per-clicks) was broken.


"Global advertisers appreciate that CPC inflation is taking a breather," Mann said. "This shift appears to be due to a fundamental change in search behavior by consumers, who are now further along in the conversion process by the time they initiate an internet search. In addition, advertising strategies are more effective than ever and the search engines have improved their matching algorithms, resulting in more relevant query results for consumers and greater cost efficiency for advertisers."

Looking ahead through 2012, Covario is recommending that global advertisers keep pace with the competition and increase paid search spending by 18 to 22 percent overall to maintain market share -- 18 to 20 percent in the Americas, 15 to 18 percent in EMEA, and 40-plus percent in the Asia/Pacific region.

"Asia/Pacific continues to be where the major growth opportunities exist for global search marketers in the high-tech industry," Mann said. "The economies in North America, led by the U.S. and Canada, are also stabilizing and are poised for stronger growth in 2012. On the other hand, growth in search spending in Europe will further decelerate due to the macro-economic slowdown and political unrest in the region."

The Covario Global Search Spending Analysis encompasses all of the major search engines and is based on worldwide paid search spending by the firm's high-tech and consumer electronics clients. This is the fifth year of the analysis, which spans the first quarter of 2007 through the fourth quarter of 2011. Covario clients invest about $400 million in annual paid search programs conducted worldwide on numerous search engine platforms in more than 45 countries. All of the data was compiled using the Covario Paid Search Insight™ software solution.

About Covario
Covario is the nation's largest independent provider of paid search and SEO agency services, as well as licensable SaaS-based SEO software solutions. The firm is also the developer of a unique platform for cross-media optimization and attribution analysis, known as the Covario CMO Dashboard™. Headquartered in San Diego, the firm has more than 130 team members worldwide with offices in Chicago, London, Beijing, Tokyo, and Singapore. Covario's growing customer base includes world leaders in technology, consumer electronics, retail, ecommerce, financial services, media, entertainment, publishing, and consumer packaged goods. More information is available at http://www.covario.com.

Contact:
Rick Clancy
Sr. Director, Public Relations
858-397-1500, ext. 1643 office
[email protected]


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