Mktg - Search marketing spends to reach $175 million in 2008-09

The Internet and Mobile Association of India (IAMAI) and IMRB have released a report on search engine marketing (SEM). The findings of the report are based on a primary research including in-depth interviews with professionals involved in SEM and the I-Cube report released in 2007, which was based on a primary survey of 65,000 individuals and 12,000 households in 30 cities in India. The report shows that the use of online search in India is growing. About 75 per cent of the 29 million active Internet users use search compared to 35 per cent in 2004. It also shows that 47 per cent of the active Internet users search for education related information while 21 per cent users search for entertainment based content. As expected, Google is the most popular search engine. A major portion, 64 per cent of the users, prefer Google while Yahoo! is preferred by 20 per cent.
More than 70 per cent of the users landing on a search engine are from the top eight metros. Users from smaller towns and cities are yet to experience the power of search engines.Globally, SEM is increasing and the report estimates that SEM expenditures in North America, including the US and Canada, will reach US$ 25.2 billion in 2011 (it was $12.7 billion in 2007). Advertisers are shifting more of their advertising spends from traditional media to SEM. In 2007, about 32 per cent of the print advertising budget was shifted to SEM as compared to 20 per cent in 2006. The report reveals that the size of the SEM industry in India is still small and the total spend on search marketing stood at US$ 112.5 million in 2007-08. It is expected to reach US$ 175 million in 2008-09. The total spend on search marketing in 2009-10 is expected to reach US$ 225 million. SEM agencies in India serve both domestic and international clients. Of the total client base, 75 per cent are domestic while the balance is represented by international clients. The report points out that a majority of the domestic clients belong to the BFSI (banking, financial services and insurance) sector.