Retailers Increase Spend on Search in Time for Black Friday & Cyber Monday

Research released from SearchIgnite suggest a strong Q4 for the U.S. retail sector ahead of Black Friday and Cyber Monday. Retailers have increased their spend on search in Q4 of this year, by 37% YoY when compared to the first half of Q4 2009. This coincides with an increase in consumer spending, with Average Order Value up nearly 21% and conversion rates increasing by nearly 29%.

However, according to the study, growth in spend on the combined Yahoo/Bing has slowed, growing only by 2% YoY, down from mid-Q4 2009 when both engines showed more significant increases (47% Bing, 8% Yahoo YoY). Yahoo/Bing accounted for 17% of all U.S. retailer search spend in Q4 2010 compared with a collective 24% in the first half of Q4 2009, before the two companies’ combined operations. Meanwhile Google commands 84% of retail search spend so far in Q4, up from 75% in mid-Q4 2009.

Finally, CPCs are rising for retailers, notably on Google where CPCs are up nearly 13% YoY, compared with only 4% on Yahoo/Bing. This finding runs counter to industry speculation that the combined Yahoo/Bing paid search platform would cause a sharp increase in CPCs.

This report tracked more than 70 million clicks on Google, Yahoo! and Bing during Q3-Q4 from 2007-2010 across retail marketers. “The increase on search spend among retailers is promising for the state of the search market overall,” said Roger Barnette, CEO of SearchIgnite. “More promising, however, is consumers’ increased Average Order Values and conversion rates. We expect this to be a very strong holiday season for e-commerce as the economy bounces back and consumers increasingly go online to do their shopping.”

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