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Web Search & Marketing Newsletter - March 2009

Welcome to the latest monthly issue of our newsletter, covering web search and marketing news, trends and advice.

This month we look at the latest figures on Internet advertising in Australia for the last quarter and for 2008, which still show impressive growth trends, particularly in search advertising. We also review the recent tests made by Yahoo! for a new format of PPC advert which integrates images or video. Finally this month, we cover the benefits to business websites of the Site Overlay function within Google Analytics.

Read more about these stories below, or you can also browse through previous editions of the newsletter, either by month or by subjects covered.

On to this month's edition...

Internet advertising continues to grow in Australia

The Internet Advertising Bureau (IAB) have recently published the latest quarterly and annual figures for the Internet advertising trends in Australia. These continue to show a good level of growth in this market over the past year but there are signs that the growing economic recession are now starting to have an effect in some areas.

This latest data from the IAB has been compiled again by PricewaterhouseCoopers from a sample of over 1,000 website properties in Australia. Annual figures for 2008 show a growth of 27% to the previously forecasted figure of $1.7 billion - up $364m on the 2007 figure of $1.34 billion. The market is now expected to break the $2 billion barrier by the end of this year, although growth rates are slowing and the current economic situation may hinder this growth (or potentially increase it if more spend in channelled online and away from other media).

The Search and Directories category remains the main growth area, although since Google refuses to reveal their numbers, the figures remain a significant estimate. However, year on year this category grew by 30% to $807m. In the fourth quarter of 2008, the sector grew by 27% compared to the same period in 2007, to $224m. It also grew by 6% over the third quarter in 2008, which is the critical figure as the 'credit crunch' began to bite during this period.

Of the other 2 monitored categories, Display Advertising grew by 27% in 2008 to $465m and by 24% year-on-year in the fourth quarter, to $130m. Compared to the third quarter in 2008, this marked a 4% growth in advertising spend. Finally, the Classifieds sector grew by 23% for the year, up to $439m, and by 10% year-on-year for the quarter, to $108m. However, compared to the third quarter, this sector shows a drop of 5% - the first ever and possible signs of the slowdown affecting online advertising.

So overall these latest figures continue to show a healthy advertising sector that continues to grow and challenge the market share of the more established media sectors, such as radio and print. The next quarterly set of figures will be critical however, to see if the forecast growth for this year will be on target as the economic gloom continues. It is widely believed - and recommended by many - that companies should be focusing more of their spend online in 2009, since this medium can be highly targeted and measurable. The next IAB figures will provide a better indicator as to whether this trend is occurring yet and whether this sector will continue to show a good rate of growth.

The detailed summary of these figures can be downloaded as a PDF report from the IAB website. If you'd like to know more about the report and how Internet advertising could help your business, please contact us for a discussion.

Yahoo! tests new format search adverts

Yahoo! is currently testing with a new form of PPC advert in the US, which integrates images and video. Although this is something Google already offers for selected advertising with their third-party content network, Yahoo!'s new test has been targeting their main PPC channel on the Yahoo! search network.

Called Rich Ads in Search, Yahoo! is hoping that the higher profile and better clickthrough rates shown from the initial tests will attract more advertisers to use this format of advertising, and will also drive more clicks - and therefore revenue - from their search results.

Yahoo!'s traditional strength has been in display advertising, but as the current economic recession has deepened in the US many advertisers have shifted money to search, which gives them direct, measurable results. Yahoo!'s recent fourth-quarter results have reflected this trend, with search revenue showing an 11% growth and display revenue falling by 2%.

Yahoo! has been testing these new adverts in a number of formats which can be seen with brand name searches of yahoo.com. For example, searches for dog-food company Pedigree display a small video for a commercial and the video opens up into a larger format and plays once clicked. Similarly, a search for Staples displays in a similar light-blue box with the company’s logo on the side, which is also a link to the corporate site. Alternatively, retailers can include a search box within the advert panel to enable searchers to enter a ZIP code, which will then take them to the advertiser's website that lists the nearest stores or branches nearby.

Yahoo! is currently charging a monthly fee for the service, compared to the traditional auction-based pricing of search advertising. It is reportedly only allowing a selected number of large, brand-focused advertisers to test the program at present and, according to Yahoo!, some advertisers in the pilot program have seen an improvement by as much as 25% in click-through rates, although an independent agency reported lower results, around 5-10% higher than the regular text adverts.

Yahoo! clearly hopes that this new type of search advertising will prove attractive to companies who pay high prices to develop their commercials and logos and want to be able to show those wherever they can. It may prove an important development for Yahoo!'s search performance as the company remains under pressure from financial analysts to consider selling its search business to Microsoft, who continue to express an interest in such a deal to grow their share of the search market.

If you'd like to know more about this trial and the different formats available to PPC advertisers, please contact us now for more details.

Using the Site Overlay function in Google Analytics

One of the features that is often overlooked within the Google Analytics service is the ‘Site Overlay’ option. This can visually display the percentage of visitors who click upon standard links that are embedded on a particular page of a website and can be a valuable source of information on the ways users are actually navigating through the site.

For example, one way that Site Overlay can be used is to visually show what percentage of visitors clicked through to the main pages linked from the website's Home Page, or within the main navigation menu. This is a great benefit to website owners as it gives them a clear depiction of which page most of the visitors go to from the initial home page, or the primary landing pages used in a search advertising campaign. Therefore it's instantly possible to see the most popular paths that visitors follow and the most visited pages. By hovering the mouse over the percentage box in the Site Overlay, another box appears that displays the actual number of clicks to that page and the number of conversions to a particular goal on that page.

If the link is clicked upon, the Site Overlay takes you to that next page and then displays the information according to the links from that page. It's therefore possible to see which are the best performing links or pages in terms of click density and what the most popular route to a particular goal is, without necessarily having to set up small qualitative research groups. This information can enhance a website's optimisation by allowing site marketers to experiment with different landing pages, layout, content and navigation routes, leading to a much more effective streamlining of visitors to converting customers.

The Site Overlay tool does have some restricted functionality, however. Currently the results are only displayed on static (as opposed to dynamic) pages that have unique links to content located elsewhere on the website. So if a page has numerous links pointing to another page, the total of clicks for all those links will be displayed in each of those site overlay boxes. Other limitations include the inability to function within frames, with URL redirects, or with Javascript or subdomain links so that in these cases the Site Overlay stats are not displayed.

Overall though, the Site Overlay is a very useful addition to a website's analytics toolbox, and should be reviewed at least monthly. If you'd like to know more about how Google Analytics could be used to enhance your website's performance, please contact us.

Book Review - Search Engine Marketing

As part of our occasional series of book reviews featuring online marketing books, we look this month at Search Engine Marketing, by Andreas Ramos and Stephanie Cota. This new book combines all the critical tools for a successful search engine marketing campaigns, from using web analytics, key performance indicators (KPIs), search engine optimisation (SEO), and PPC marketing.

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:

We hope you've found this month's issue useful. Please contact us if you need any more information 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 to us.