SOURCE: Covario, Inc.

Covario, Inc.

April 14, 2011 16:04 ET

Covario Finds Paid Search Spending Enters 2011 With a Bang

Quarterly Analysis of High-Tech Firms Shows Global Search Ad Spend Way Up as Q1 Surpasses Q4 for First Time

SAN DIEGO, CA--(Marketwire - Apr 14, 2011) - Covario, Inc., one of the nation's leading independent search advertising solutions providers, today issued its Global Search Advertising Spend Analysis, which found that paid search advertising among its high-tech and consumer electronics clients was up more than 26 percent over the same period last year. Plus, for the first time in the report's four-year history, first quarter PPC (pay per click) ad spending exceeded that of the fourth quarter last year -- by more than 6 percent.

The quarterly analysis attributed the growth in paid search spending between the last quarter of 2010 and the first quarter this year to global increases in cost per click (CPC) rates driven by improved monetization techniques by the search engines (e.g., the launch of Google Instant) and advertiser spending on more expensive search terms. As for the 26-plus percent growth over the first quarter of last year, Covario cautioned that the first quarter of 2010 was very weak -- down significantly from 2009 -- leaving plenty of room for growth in 2011.

Globally, the most rapid increases in paid search spending continue to come from outside of the U.S. in the Asia/Pacific and the European/Middle Eastern regions -- both of which were up nearly 50 percent from the same period in 2010.

"Our clients are seeing CPC increases in the U.S., along with compression of their CPA (cost per acquisition) rates," said Craig Macdonald, chief marketing officer and senior vice president for products at Covario. "This is prompting them to look overseas for large gains in paid search advertising returns."

Among the search engines globally, spending by these high-tech advertisers on Google was up 25 percent in the first quarter compared to the same period last year. Ad spending on the "BingHoo" search alliance was up a weighted average of 32 percent, with Yahoo up 28 percent and Bing -- which is primarily U.S.-focused -- up less than 4 percent.

Google continues to dominate globally with 73 percent of the international paid search market share, a percentage that has declined slightly over the last year due to market share losses to Baidu in China. BingHoo has a combined 21 percent of the global market among these high-tech advertisers. Baidu, which now has 80 percent of the market in China, has 4 percent globally.

To maintain market share in the global high-tech and consumer electronics sector, Macdonald said Covario is continuing to recommend that marketers increase global paid search budgets by 15 to 20 percent for 2011 over last year's budgets.

"We are going to wait until the end of the second quarter to see if we need to revise our forecast, given Q1's strong growth rate," he added.

About Covario™

Covario, Inc. is among the nation's largest independent SEM (search engine marketing) and SEO (search engine optimization) solutions providers, offering SaaS-based software and digital agency services for paid and organic search management. Covario provides global organizations with robust solutions for paid search advertising, organic search, social media, display advertising and cross-media attribution analysis. Covario helps companies manage their brand integrity; ensure budget transparency; and deliver quantifiable results across business units, distribution channels and languages. Headquartered in San Diego, the company's growing customer base includes some of the world's best known brands in technology, consumer electronics, retail, ecommerce, financial services, media, entertainment, publishing and consumer packaged goods. More information about Covario is available by calling 858.397.1500 or online at http://www.covario.com.

Contact Information

  • Contact:
    Rick Clancy
    Sr. Director, Public Relations
    858-397-1500, ext. 1643 office
    rclancy@covario.com