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Challenged by ROI requirements but bolstered by social media marketing, the search engine marketing industry is predicted to grow by $2 billion in 2010

Search engine marketing in North America already is valued at $14.6 billion, but a new report from the non-profit Search Engine Marketing Professional Organization  (SEMPO) estimates the industry will grow 14 percent to $16.6 billion in 2010.

The report determined that the industry’s biggest challenge was ROI, a finding that comes as no surprise to anyone working with search engine optimization, paid search or social media marketing. ROI also underpins a shift of marketing budgets from traditional media to the more efficient, effective and measurable use of search tactics, it emphasized.

Around half the surveyed companies (49 percent) are reallocating budgets to search engine marketing from print advertising. More than a third (36 percent) are shifting money away from direct mail, and almost a quarter are moving budgets from conferences and exhibitions (24 percent) and web display advertising (23 percent).

Keyword cost is another issue. More than half of advertisers (56 percent) and agencies (62 percent) say that Google keywords have become more expensive over the last year, while around a third of advertisers noted an increase in Yahoo (32 percent) and Bing (29 percent) keyword costs.

SEMPO’s State of Search Engine Marketing Report 2010 was based on a survey conducted by Econsultancy of nearly 1,500 client-side marketers and agency respondents. Read more about it here.

— Chris Marlowe

This entry was posted on Wednesday, March 31st, 2010 at 3:14 pm and is filed under Did You Know.... You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.