How long can a paid search engine marketing market

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The Search engine Marketing Service Market has become the most compelling area in nearly 3 years, according to statistics released by the US Interactive advertising agency (IAB), from 2001 to 2003, 3 years ago, The search engine marketing market, represented by keyword ads, soared from 4% in the online advertising market to 15% in 2002 and 30% in 2003. This period is the network advertising market from the initial ultra-high-speed growth into the trough period, 2001 and 2002, respectively, the growth rate of 12% and -16%,2003 year network advertising market finally out of 3 consecutive years of decline, the growth rate reached 20%, so that online advertising again show a bright future, This is largely due to the growth of paid search engine marketing, which accounted for $2.4 billion in the 7.2 billion dollar market for online advertising in 2003.

Why does paid search engine marketing grow so rapidly and how long will this growth last? What factors affect the development of the market?

The first reason for the formation and rapid development of the search engine marketing market is the historical opportunity of the change from concept to real income after the bursting of the internet bubble: from the last six months of 2000, enterprises began to rethink and understand the value of network marketing, Website promotion based on the network marketing is increasingly valued by enterprises, and the traditional means of promotion based on free search engine has been unable to meet the requirements of enterprises, and therefore the need for more effective methods of promotion, enterprises are seeking to be able to obtain tangible benefits, and do not care whether the need to pay, With the help of the enterprise to the search engine marketing has formed the understanding, the timely introduction of such keyword ads, for enterprises to carry out network marketing provides a new means, thus gaining the favor of enterprises.

The other important reason for the rapid development of the paid search engine marketing market is that the network Marketing service that the enterprise chooses in the current Network marketing service market is relatively few, especially the lack of the substitute product with obvious effect to the website promotion. Even in the paid search market, due to the small number of service providers, the industry shows a clear concentration, so the industry competition is relatively small, it can be said that paid search to a certain extent, is still in the seller's markets. Time Marketing published in October 2003, "China's Network marketing services market Research Report" shows that in the website promotion services, 43.5% of the service provider agent main portal search engine registration business, 31.1% of the service provider to provide network real-name agent registration business, Baidu to provide competitive ranking of the service provider accounted for 24.9%. Visible, in addition to search engine and network real name outside the network Marketing service products are very few, this also explained that the Network Marketing service area also has the very big development space.

In addition to search engines, online advertising and email marketing methods are also effective web site promotion means, but because of network advertising and formal licensing email marketing price is relatively high, it is difficult to obtain widespread use in most small and medium-sized enterprises, The current applications are mainly large enterprises and companies with sufficient marketing budget. As a result of these network marketing means relative to the high cost high input of search engine marketing, it is difficult to form an alternative relationship for the marketing service of the paid search engine in the short term, this also creates the relaxed competition environment for the search engine marketing.

However, the search engine marketing market growth also has a certain limit, this is due to the industry competition, enterprise Network marketing strategy, such as the evolution of factors such as the decision. According to a recent study published by emarketer, a market research firm, the U.S. paid search engine marketing market growth rate has peaked in 2003, and the keyword search market will continue to grow in the 2004, but the growth rate of the overall network advertising market share has begun to decline gradually. 2004 accounted for the total network advertising market share of 32.5%, 2005 34.5%. From this can also be explained that the paid search engine marketing services market will gradually enter a stable development period, the early stage of the market development of high growth trend will significantly slow down. It can be reasonably speculated that with the increase of the choice of network marketing means and the improvement of Network marketing level, the proportion of website promotion in network Marketing will appear relative downward trend. At the same time because more enterprises into the paid search engine market, the competition in this field will also change a certain degree, even if the overall market size is expanding, each service provider's share of the market will also have a downward trend.