SEMPO: State of Search Marketing 2009

• 1. SEMPO: State of Search Engine MarketingSurvey of Advertisers and AgenciesSearch Engine Marketing Professional Organization (SEMPO) February, 2009

2. Agenda

• About SEMPO

• SEMPO Mission & Team

• Local and Global Activity

• State of Search Marketing, 2008

3. About SEMPO

• Global non-profitwith over 875 SEMPO members, representing thousands in 40 countries

• Membership includestraditional agencies ,interactive agencies ,in-house marketers, individual search,andtechnology

• Produce the industrys mostcomprehensive market researchannually, 5 years running

• We invest ineducation ,research,andthought leadership

• We are buildingcommunity locallyandglobally

4. Mission and Board of Directors 2009-2010 ChairpersonJeffrey Pruitt Partner, Arkon Ventures PresidentSara Holoubek Corporate Strategy Consultant Vice PresidentRon Jones President/CEO, Symetri Internet Marketing SecretaryChris Boggs SEO Manager, Roseta TreasurerDave Fall VP Product Mgmt-Search, Google Jessica Bowman In-House SEO Consultant Massimo Burgio Global Search Expert, Global Search Interactive Bruce Clay President, Bruce Clay, Inc. Duane Forrester Senior Program Manager, MSN SEMPO is a global non-profit organization serving the search engine marketing industry and marketing professionals engaged in it. Our purpose is to provide a foundation for industry growth through building stronger relationships, fostering awareness, providing education, promoting the industry, generating research, and creating a better understanding of search and its role in marketing. Gordon Hotchkiss, President, Enquiro Search Solutions Bill Hunt, President, Back Azimuthl Kevin Lee Executive Chairman, Didit Dana Todd, CMO, Newsforce 5. Local and Global ActivityActive working group New working groups for 2009-2010SEMPO working groups create a needed space for education, content, and networking at the local level 6. SEMPO Research A study by the Search Engine Marketing Professional Organization (SEMPO) slated for release on Dec. 4 found that 71% of advertisers are "worried" about click fraud, or describe it as a "moderate" or "significant" problem. (2006) SEMPO research, including the State of the Market survey and the salary surveys, is widely regarded and frequently referenced Companies spent an estimated $8 billion in 2006 for sponsored links on search engines, according to the Search Engine Marketing Professional Organization, or SEMPO, a trade group.(2007) Also, search is continuing to steal from traditional ad budgets, according to the survey. More than a quarter of advertisers reported that they were shifting budgets into search marketing from print magazines. Nineteen percent said they were shifting their budgets into search from print newspaper advertising (2009) Even as some marketers rein in spending to hedge against further economic problems, search engine marketing (SEM) is in great shapeat least for the moment (2008) 7. About the Report

• Radar Research, Inc. oversaw the following research initiatives as part of this project:

• • Understand the size of the industry in order to help promote its growth

• • Understand where marketer spending is going, among different recipients (search engine media companies, SEM agencies, in-house) and towards what types of SEM programs (paid placement, organic SEO, SEM technology)

• • Identify key industry trends

• • Identify key industry issues SEMPO should address

• Radar Research oversaw the following research initiatives as part of this project:

• • Development of SEM forecast model

• • Detailed online survey completed by 890 search engine advertisers and SEM agencies, administered via IntelliSurvey, Inc.

• • Extensive analysis of secondary research, reporting and commentary

• Almost two thirds of global respondents are agencies

• 125 of the 317 advertiser respondents are from firms of 500-plus employees

• 95% of advertiser respondents have budget or strategic oversight or are directly involved in SEM.

8. We Need Your Feedback! Source: Search Engine Marketing Professional Organization survey of SEM agencies and advertisers, Nov 08-Jan 09. Global Results. Copyright 2009

• In total 890 respondents completed the survey

• North American firms (U.S. and Canada) made up three-quarters of all respondents

• Respondents from other countries included Argentina, Australia, China, France, Germany, Hong Kong, India, Israel, Italy, Netherlands, Norway, South Africa, Spain, Sweden

Location of Surveyed Companies "What country is your company located in?" Total n=890 ABOUT RESPONDENTSUK 5% Other 20% 9. Key Points

• Search spending is still growing

• Search ROI

• Revenue from Search

• Senior executives and search

• Search in the marketing budget & mix

• Forward looking

• • Video

• • Mobile

• • Local

• • Social

10. Show Me The Money Spending will grow to $26.1 billion by 2013 in North America. We actively encourage more European respondents to participate to effectively measure global spend. Source: Search Engine Marketing Professional Organization survey of SEM agencies and advertisers, Nov 08-Jan 09. Global Results. Copyright 2009 11. Search Still Rules ROI Source: Search Engine MarketingProfessionalOrganization survey of SEM agencies and advertisers, Nov 08-Jan 09. Global Results. Copyright 2009 Marketing Vehicles Respondents Cited as Among Their Top Three by ROI "What are the top-three most-efficient forms of advertising or marketing you spend money on in terms of the return on investment (ROI) or return on ad spend (ROAS) that they yield? (ranked 1-3) 12. Projected Revenues from SEM Climb Steeply from Last Year

• More than one-third of advertiser respondents expected their firms to book more than $100 million in revenue in 2008 continuing the upward trend from previous years.

• Nearly a fifth of all advertiser respondents expected their firms to book less than $1 million in revenue in 2008

• Almost two-thirds of small firms (