Web Search & Marketing Newsletter - January 2008

Welcome to the January 2008 issue of our monthly newsletter – the first for this year and so to begin we would like to wish all our customers and readers a happy and prosperous New Year.

In this issue we have attempted our usual 5 predictions for the main trends that we think could be expected for the coming year. We have also looked back at 2007 to see which of our predictions from 12 months ago came true – the last year has seen a massive amount of change, particularly from Google with new developments being launched almost weekly and the other main search engines reacting to stay even.

The rise of Facebook has also been the big trend from the past 12 months, although how much of this is hype has yet to be seen. With so many changes taking place it's hard to see what may be coming up but read on below and see how accurate we were last year and what we might expect to see this year.

You can also browse through previous editions of the newsletter.

On to this month's edition...

Which predictions for 2007 came true?

This time last year we made 5 predictions for 2007 and so here's a quick summary of our list and what actually happened (you can read the originals in more detail in our January 2007 Newsletter):

1) A growing emphasis on site conversion: there were some signs that more companies were beginning to focus more on the way that their website was working and converting visitors over the past year. As the average PPC bids levels continued to rise, with figures of 10-30% over the past year - depending on the market - Google and Yahoo both introduced tools to test website ROI (return on investment) rates. However, the search engine market is still becoming increasingly competitive and costly so that more companies should be using their website analytics (including the very detailed, and free, Google Analytics package) to help identify areas where their site may be working well or could still be improved, to make more of every visit to their site and to increase the visit to conversion rates. In addition, an increased focus on competitor activity can also provide clues to help one online business perform better than another.

2) Search marketing becomes a core discipline: digital marketing overall is becoming well and truly established within many business marketing strategies and budgets, with search marketing taking the largest share of spend. Figures over the past year in both the UK and Australia continue to show the rapid growth in this area of marketing and companies need to ensure that they are getting the best from this sector - and that they continue to develop their websites and online marketing plans for the long term. With an ongoing skills shortage in this still young market, the benefits of applying genuine search marketing expertise effectively to any campaign remains the best solution for any business that wants to achieve the best results.

3) Local search gains prominence: the developments made by Google over the past year have been significant, with the introduction of 'universal search' results being the most obvious opportunities for local business marketing. Further improvements are still being introduced within the PPC sector and mapping tools are also gaining ground, particularly if mobile search begins to take off. Many localized companies still view search engine marketing as 'not for them' and price prohibitive, yet with more and more people using Google and other business search tools to find local products and services, this can still be the most cost-effective form of local marketing there is.

4) The question of click fraud is tackled: this hasn't been resolved to any great degree although the debate about the definition and methods for tackling click fraud seem to have taken a back seat for the time being. Google does report on 'invalid clicks' within the AdWords reporting system and is open about providing credits, yet this probably doesn't go far enough for some advertisers and any claims require significant management time to follow through to any great success. In the rush by many companies to get their sponsored listings within the search results, click fraud is largely seen as a factor that has to be built into the overall results that will make a campaign a success or not.

5) Social networks become a new marketing challenge: we made no mention of Facebook this time last year, but this site has become the primary media focus within social networking over the past year. The ability for developers to create applications has extended the use of this tool substantially and it could become a significant marketing tool over the next year. However, the recent backlash from users over the invasion of privacy to create advertising applications has placed some control over how Facebook will operate in this market, but we're likely to see this sector develop still further over the next 12 months with new innovations and opportunities (as well as threats) to companies who wish to use these social networks to promote their products and brands.

Our predictions for 2008

What do we predict will be some of the main trends this year? Here are our 5 thoughts for 2008.

1) 'Universal search' becomes a significant optimisation issue: the introduction of 'universal search' results by Google – where images, videos or maps are displayed within the main search listings for a relevant search – followed the earlier move by Ask and were then followed by similar changes at Yahoo! and MSN. The quality and extent of these universal search results will really be noticeable in 2008, which will produce a greater need for more flexible search engine optimisation techniques, as well as make companies review the way that all of their online content could be used to generate search engine traffic. A greater flexibility within PPC advertising may also follow and provide new opportunities to display text or images within the main search listings.

2) Personalisation gains ground: the 'opt-in' use of personalisation has yet to be adopted by most web users, particularly within search results. However, the opportunities to adapt the web to your own needs will become more widespread and accepted, with the BBC now offering this option to users and iGoogle also gaining ground. The impact of this trend will mean more detail on web usage being available to companies and new services being introduced in response to dominant trends. Within search results the importance of attracting clickthroughs from PPC and 'natural' search listings will become more important, as will the underlying visitor trends and site usability.

3) Behavioural advertising becomes the next 'big thing': this is quite closely linked to the personalisation trend although other data can be used by large networks to identify market segments for more targeted advertising, whether through search or by display advertising. Google's long drawn out acquisition of DoubleClick should be finalized soon and this is expected to yield new services and techniques for advertisers to compete with services being introduced by Yahoo! and MSN. As Facebook discoved recently however, behavioural advertising needs to be handled carefully to avoid too much intrusion of privacy, but for advertisers this could become the best way of improving ROI over the next 12 months.

4) Content targeted advertising becomes the new PPC battleground: Google remains the only one of the main PPC tools to really offer a powerful third-party advertising network where adverts are generated by page content matches. The improvements made by Google to the content-targeted tools in 2007 has made this a much more open and manageable PPC option and there are signs that as the main AdWords network becomes more competitive and costly, content targeted can be a more cost-effective way of generating business. More testing needs to be done here but the potential reach of this network now makes it an important part of any online marketing strategy.

5) Mobile search finally becomes serious: after many false dawns with mobile marketing, 2008 could finally be the year when this really takes off. The adoption of the 3G mobile broadband network, the worldwide launch of the Apple iPhone, the development of Google's mobile phone software and the massive use of mobile phones in China, could mark the tipping point where many more companies need to start considering how they could take advantage of this market and what needs to be done, either with their websites or their use of search.

Recent articles from The Marketing Workbench

The Marketing Workbench is our regular web marketing blog covering news and comment on Internet marketing events and trends. If you want to keep track of current stories you can visit this section of our website on a regular basis, or set up an RSS feed. These are just some of the items posted over the past month:

• Google removes Supplemental Index
• Google announces 'knol' reference tool
• Affiliate marketing faces traffic hijacking
• China's growing digital market
• Optimising keywords on Google's content network

We hope you've found this month's issue useful. Please contact us if you need any more details on the items covered, or our advice on any aspect of your website's performance. Also, if there are any issues you would like to see in future editions of this newsletter, please submit your suggestions.