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Search Marketing Predictions for 2008

newcomb-kevin
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Last week, we shared some New Years Resolutions from several search marketers and social media marketers. I asked many of those same marketers what they thought 2008 had in store for search. Again, I'll be sharing their responses in two parts.

If you want to share your own predictions, or discuss any of the ones shared here, feel free to join the conversation in the SEW Forums.

Q: What do you predict will be the three most significant happenings in search for 2008? General themes, specific events to watch for, or even straight-out predictions would work.

Amanda Watlington, owner of Searching for Profit

Top theme for me is a bit gloomy. If the pundits are right we may be lurching into a recession. Again if they are right, it will last throughout the year; hence it is not a short term blip in the purchasing radar. Other than the dot-com bust, which did not uniformly impact the broad economy as a whole, we have no data on how search performs during a time of reduced employment and lowered consumer spending – typical hallmarks of recession.

Search is a pull medium, with the consumer doing the pulling via the keyword. In the past decade consumers have continued to elevate their level of engagement with search and have increasingly integrated it into their daily lives. We have enjoyed huge growth as a result.

I am curious and a bit anxious to see: What happens to search when the searcher's daily life changes – loss of job, loss of home, loss of health insurance – all part of the ugliness of recession. Do laid off consumers reduce their searching as they no longer have the fast broadband connections they once enjoyed in the workplace? Should we be looking at differing times of activity? For many of my client sites, the busiest times are at the end of the workday. Will this shift? Will we see changes in traffic and basic site visitation metrics?

Clients have enough experience by now with search to have developed expectations as to what they believe it will deliver, but those expectations have been framed during a time of continuous growth in the online sector and for the economy as a whole. During recession, I expect that we may see lots more lookers and less buyers. The malls were very busy at Xmas, but the buying was slow and the discounts and early sales were used extensively to draw in the purchaser. Huge sales reduce margins and increase business risks.

What will this mean for search? In my opinion unless the site owner has a firm grip on the metrics of search as it relates to the cost of selling the goods, they may falter, particularly if the recession extends through multiple seasons. Last year would not have been too soon to focus attention on improving conversion of paid search. Every marketing dollar is more precious during recession and must be spent ever more carefully. So that being said, improved bang for the buck is a must-have.

As search marketers we are the insiders. We are supposed to know and understand search in all of its dimensions. We are moving into uncharted territory. It is not territory that I am excited to explore, but I will go there nonetheless.

Andrew Goodman, principal at Page Zero Media

1. Justified or not, there will be renewed calls for investigations into forms of "bias" in how Google serves up content, how it downgrades the performance of its direct competitors in both paid and organic listings, etc. For the time being, these claims and charges will remain toothless, as it is an election year and no one is actually going to do anything about anything.

2. Rich Skrenta's search engine startup, Blekko, will be acquired by Yahoo even before it comes out of beta.

3. Jason Calacanis will discover that he doesn't have "unlimited access to capital."

4. Google will release the GPhone. It will be one of the most embarrassing flops in Google history.

OR, Google will begin giving away free mobile devices of some sort, intended to create loyalty to the Google brand and software. This too will add fuel to the fire of "antitrust" and "unfair competition" charges being bandied about, and again, nothing will happen soon because it's an election year.

5. Several prominent Googlers will be accused of bias in their support for presidential candidates, especially Barack Obama. Their responses will refer to such basic Constitutional rights as the First Amendment.

6. In Myanmar, Internet usage will continue to be restricted or banned. A blogger will be executed publicly. It will lead to external military intervention. Pro-am journalists will bravely enter the country and images of repression will be posted on NowPublic, YouTube, etc.

Anne Kennedy, managing partner of Beyond Ink

In 2008, we need to keep an eye on Wall Street. Here's why: as our market expands to include many more businesses, which is good, many potential customers will be publicly held, and sensitive to economic factors such as stock prices, prime rates and quarterly earnings reports, always dodgy for marketing budgets. That search marketing provides measurably superior ROI to other media is good. The challenge remains to convince marketing folks inside such companies of this, when search is strangely foreign and often in conflict with traditional marketing principles.

We need to watch our backs for competitive undermining from Madison Avenue agencies, who are already worried about their own budget allocations for 2008, given the anxious U.S. economy. The last time a recession reared its ugly head, they were the first our established media partners jettisoned from new business as they drew up the gangplanks to save their own revenues. Search marketers worked smarter and more nimbly and prospered then, but are we solid enough to do it again?

Marketing budgets will be cut. Our task is to increase the search proportion regardless of this, which means dedicated effort to befriending and convincing traditional marketers that search is their best strategy.

The shape of 2008 will be set by the efforts of folks at either end of Pennsylvania Avenue, and the resulting effect on the economy. The race for the White House will prove distracting and even divisive to our customers, and raise the noise-to-signal ratio considerably by competing for space in the search stream.

With the search engines, dwindling transparency is of concern, both in PPC pricing and organic results.

Dana Todd, executive VP at SiteLab International

1. We should see a leveling-out of the search market share pie this year, although I think it's going to be end-of-year before we see it hit a ceiling. Google will continue to take share-of-queries from the others, but will cap out at 85% or less. The others will focus on leveraging their non-search ad programs to make up the revenue losses.

2. The Google/DoubleClick merger will prove a strain for Google, as they find themselves in the same boat as Yahoo after its Overture acquisition. Selling both performance advertising and display advertising is a challenge, and creating synergies between the sales/customer support teams of both organizations will take years. However, the behavioral targeting potential upside is huge if they can get it integrated.

3. Google's stock price will take a tumble, but probably not as bad as some folks might think – it's not going to collapse the way many internet stocks did in the last bubble. Wall Street is fickle, and many are looking for reasons to doubt Google's valuation. I see it taking a wallop at the end of the year, Q4, losing about 2/3 its stock price.

4. Ad exchanges will NOT prove to be a significant evolution in the display ad world, as advertisers test the model and find that remnant inventory is still remnant inventory, even if it's in a bargain bin. With a few exceptions, most of the insta-networks will die this year. Even behavioral will not drive significantly higher CPMs for display. What WILL drive up pricing is scarcity, as the premium spaces fill up their inventory. Expect to see a growing gap between premium and non-premium ad space.

5. Yahoo will separate its publishing properties (e.g. Yahoo News, Yahoo Finance) from its advertising networks (display, search, mobile), which will give it more flexibility in providing a larger suite of offerings to advertisers. Alternately, AT&T will buy Yahoo to help bulk up its mobile and local/directory products.

6. Google News will take on Yahoo News head to head for users – this is one area where Yahoo has dominated easily, and it's an under-monetized asset. If Google can beat Yahoo News in uniques, they can easily leverage the DoubleClick display business into the property.

Danielle Leitch, EVP of client strategy at MoreVisibility

I feel that Yahoo will be someone to watch in 2008 as it relates to its market share and where it could shift to another player. I'd expect a possible acquisition or partnership to do rev share with someone else's search results, versus trying to compete with their own.

Also, I see adaption of the industry as a whole shifting from just acronyms (SEO, CPC, SEM) to "interactive marketing." As a result, I believe agencies will become more full service then they had been – which could lead to mergers or partnerships in that area too.

Education and training will be important. Although I don't know I could say that the focus will be to try and bring it in house, I do expect that companies will be requiring their own staff to be better educated on the areas that their interactive marketing agency manages for them. So training and education (online and offline) should be an important area (and opportunity) to get addressed to advertisers this year. Agencies will become more accountable than ever before, as clients push for harder-to-obtain metrics and results.

David Berkowitz, director of emerging media & client strategy at 360i

1. Consumers gain the most control yet over their privacy. Ask.com is already trying to turn privacy protection into a differentiator, but we're going to see this spread. It's going to be much easier for consumers to turn on and off features that will associate their searches and online behavior with personally identifiable information.

2. At least one of the major engines will test adding in display elements such as logos and other images in search ads.

3. While Wikia's search engine won't pose a major threat to the existing order, its presence and activist community will cause the major engines to discuss transparency much more openly.

David Wallace, CEO of SearchRank

I think more people are going to be watching Google closely in how they treat the information they have. In other words, what their policy continues to be regarding privacy issues.

I hope (crossing fingers) that Google will lose some of their market share, allowing the other three (Yahoo, Microsoft and Ask) to pick up some of that share, especially Ask.

Deborah Richman, SVP of marketing & business development at Collarity

If I'm looking at the top search engines:

  1. That Google's going to game-change the contextual ad business with banners next year
  2. That DoubleClick and Google will figure out new sales deals to draw in big publishers
  3. That Google's not going to make much progress in search algorithm, and still include Page Rank
  4. That Microsoft will make money from its publisher deals, and not from increased consumer market share
  5. That Yahoo continues to milk its traffic (unless that well-known Microsoft deal prediction happens)
  6. That Ask.com will try to cash out somehow, with some Diller financial engineering

If I'm looking at other search engines:

  1. That human-powered Mahalo and Cha-Cha won't make it big
  2. That some vertical searches will have shake-ups, maybe health
  3. That other print publishers try to buy smaller vertical engines
  4. That some of the shopping engines will keep dropping away
  5. That metasearch will not be the answer to better search

If I'm looking at social sites:

  1. That social search will finally be useful, not just for friends
  2. That Digg will get acquired by Microsoft
  3. That Facebook will open up and allow friends-data sharing
  4. That MySpace will figure out how to get in the mobile game better

If I'm thinking about widgets:

  1. That widgets become another online presence just like a website, a blog, or social page
  2. That we all get smarter about how to distribute them, not just on Facebook or Google gadgets
  3. That we start testing what belongs best in them, either links, search or content
  4. That publishers start to really get comfortable with controlling content off their domains

Debra Mastaler, link building specialist at Alliance-Link

1. Reputation management is going to be the hot service this year. With more sites adding and encouraging customer reviews, it's going to be very important to monitor what's being said about your company and provide counter-spin measures to affect rankings if needed.

2. I think you'll see a lot of the smaller SEO single shops/agencies merging and/or partnering with larger companies. SEO is no longer textbook, its success relies on custom link building, reputation management, usability and content generation tactics rather than Titles and tags. Single person shops won't be able to offer the broad and specialized services and will either need to partner out or merge.

3. More private forums are going to blossom as people become hesitant to talk openly about what works and what doesn't.

Eric Enge, president of Stone Temple Consulting

1. Google will continue to implement changes to make paid links less and less interesting. They have opened the door to overt action, and they will not turn back. The other search engines will simply bask in the glow of the results of this. This allows them to reap the benefits without taking the heat.

2. Awareness that search (SEO and SEM) is just one of many marketing-related activities will increase. As a result, SEOs will be forced to work more closely with marketing, development, and design.

3. People-driven search engines (such as Mahalo) will struggle to succeed, and fail. Groups of people do not have the capacity to be objective, and extensive human review of each search result cannot be made scalable. Ultimately, a machine algorithm will be shown to be fundamentally better.

Fionn Downhill, president of Elixir Systems

1. The Search engine marketing industry will continue to mature and there will be more consolidations of traditional SEO companies

2. Rather than the predictions from previous years that traditional ad agencies will acquire SEO companies to implement search, I see more agencies implementing their own search departments with consulting and poaching from traditional SEO firms.

3. Traditional old-style SEOs who have not adopted more of an agency model will fold, or they owners will move on to other things. ( I am working hard not to be one of them!!!)

4. Kevin Ryan will get drunk at SES New York on St. Patrick's Day

Frank Watson, director of SEM and co-founder of Kangamurra Media

1. Wikia will get some groundswell. Although it will not threaten the majors, it will grab a decent amount of market share.

2. Facebook and MySpace will be pushed aside by some new social media/networking program. The shelf life is not a long one.

3. Second Life will fall away, and possibly close, unless they develop niched "worlds" that are more easily accessed and developed.

4. China's percentage of global search share will increase dramatically, be it through Baidu or even Google and Yahoo China.

5. Bill Gross will roll out something this year that will eventually be seen as another "GoTo" type innovation.

Greg Meyers, SEM consultant at SEMGeek

1. I believe you will see the birth of "political PPC" due to the upcoming 2008 election. I think PPC will play a major part with regard to the ads/creatives messaging as well as the keyword selections. Every tactic that is being used on older media channels such as TV, radio and print will be mimicked in PPC. Not only will they be bidding on all of the candidates names and negative campaigning, but more importantly the issues for which they stand for (abortion, taxes, environment, etc..)

2. I see the search engines spending more of their R&D money on contextual advertising. As PPC continues to get more expensive, advertisers will have to find alternate ways to generate cheaper, relevant traffic.

3. I also think there will be more companies and corporations bringing search marketing "in-house," as more and more people get exposed to this industry. This is a result of the future economy and the knowledge of blogs and search engines making it easier to execute.

Gregg Stewart, senior VP at TMP Directional Marketing

Local starts to make and impact. First it will be national brands going local via their distribution channels (e.g., dealer, franchisee, etc), then local businesses beginning to embrace search.

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