Small Business Spend on Search Ads Increasing, But Growth Rate Slowing
Small businesses continue to spend more on search advertising than they did the previous year. However, the triple-digit growth from previous quarters has leveled off, according to the latest quarterly report from WebVisible.
Across a sample size of more than 12,000 small business advertisers, the average advertiser spent $2,327 on paid search advertising in the third quarter of 2010, a 43 percent increase over last year's third quarter. However, this represents a slower growth rate than previous quarters: Year-over-year spending was up 159 percent in the second quarter of 2010, 91 percent in the first quarter of 2010 and 111 percent in the fourth quarter of 2009.
The slower growth rate could indicate that small business search advertisers are closing in on the optimum level of spending they need to achieve their desired results, the report notes. Service providers are refining their ability to determine sufficient amounts to spend so advertisers can achieve the highest return on investment.
The report also found that in the third quarter of 2010, 30 percent of all advertisers included video on their landing pages, more than double the number doing so the previous year. Viewing video was the second most popular conversion action, trailing only clicking through to an advertiser’s website.
According to the report, spending on Bing increased 37 percent from the second quarter of 2010 to the third quarter of 2010. With Yahoo and Bing merging into one platform, the combination is expected to capture more than 40 percent of small business advertiser spending in the fourth quarter of 2010.