Smaller advertisers have a better shot of appearing on the crucial first page of search results and there are big opportunities for all advertisers to attract attention by bidding on less popular, multi-word terms, suggests the quarterly Search Engine Advertising Update from research firm AdGooroo LLC. The first quarter study also shows that Yahoo made gains in attracting advertisers.
The study revealed a significant increase in the number of ads being shown on the first results page—reaching a high of 5.5 ads per keyword in February, up from a low of 3.1 in September, AdGooroo says. “This means there are additional opportunities for second-tier advertisers to appear in search results,” says Rich Stokes, AdGooroo’s founder and chief guru. “That’s very good news for smaller advertisers, but it may be bad news for big advertisers already on the first page, because it may depress the click-through rates for ads on the top of the page.”
Appearing on the first page is important because 85% of interactions with search engines take place on that page, Stokes says.
The study also reveals that 42% of Google keywords produce pages with no ads and 13% with only one ad; by contrast, 15% have 10 or more ads. That means there are big opportunities for advertisers to get noticed by bidding on less popular, long-tail terms, often several-word phrases such as “red Florsheim girl’s shoes.”
“That’s where the true opportunities are, because a lot of times you’ll be the only advertiser showing up,” Stokes says. “Even if you only get 50 or 100 clicks per month, you’re going to have sky-high click-through rates when you do show up and, because you’re the only guy in town, conversion rates are going to be high.” AdGooroo says Microsoft Live Search is similar to Google in that it either has no ads (33%) or lots of them (30% of keywords produce pages with seven or more ads.) Only 18% of Yahoo keywords display no ads, while 41% display eight or more, AdGooroo says.
Yahoo took market share from both Google and Live Search in the first quarter in terms of share of advertisers, increasing to an average of more than 25% for the first three months of 2009, up about four percentage points from the fourth quarter of 2008, AdGooroo says. Stokes attributes part of that shift to a Google glitch in late January that resulted in Google briefly warning web users that every web site it pointed to posed a security threat. “A lot of advertisers got very upset about that and immediately activated their Yahoo accounts,” Stokes says.
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