It has been predicted by eConsultancy that spend in paid search will reach £4.19 billion by the end of 2012. The below graph shows the growth in the UK paid search market since 2004.
According to eConsultancy’s Paid Search Agencies Buyer’s Guide 2012, in the first quarter of 2012, 10.8% of Google’s revenue ($1150m) came from the UK market, a figure which is 18.7% higher than the same quarter in 2011. This isn’t really surprising, given that Google accounts for 90% of search queries within the UK, with Yahoo and Bing only accounting for less than 7%. However, it does demonstrate that companies within the UK are increasingly using PPC to drive business to their websites. In part, this is due to the ease of demonstrating the effectiveness of paid search activity, as well as the cost effective nature of the channel.
The dominance of Google in the UK search market means that any small changes Google make (say to the SERP, algorithm or quality score) can have a large impact on a company’s search activity. This almost monopolistic nature of the channel also means that companies who wish to use paid search advertising as part of their digital strategy have no choice but to work with Google and are, in effect, very much at Google’s beck and call.
In October 2011, Google altered the Quality Score weighting to make landing page relevance more important. This kind of change poses issues for many advertisers, who struggle to ensure their PPC activity remains optimised. If these changes increase in frequency, their detrimental impact on advertiser’s PPC strategy and performance is likely to increase.
The continued dominance of Google, their increasing speed in bringing changes to the marketplace, combined with the importance of search to many companies’ digital marketing strategy, makes for an interesting time for marketers. Now, more than ever, it is becoming essential to ensure your PPC activity is optimised and that you’re abreast of upcoming changes so that you can minimise the potential impact.