Paid search 'driving' web advertising expenditure

18th June 2008

Investment in paid search is the main driver of online advertising expenditure, which is predicted to exceed investment in TV advertising by the end of the year.

Paid search is the key factor in the shift from television-based marketing to web campaigns, a new forecast from Enders Analysis indicates.

Reuters reports that the organisation expects spending on TV advertising to fall by 2.5 per cent to £3.39 billion this year, while a 26.4 per cent predicted increase in internet advertising spending will take the figure to £3.56 billion.

And paid search is driving the growth, with Google expected to be responsible for 80 per cent of internet advertising expenditure, rising from the 78 per cent share the company commanded in 2007.

"Rising internet consumption and surging consumer e-commerce continue to drive strong growth in online advertising, particularly paid search, in spite of the deteriorating economic outlook," the report asserts.

According to the Mercury News, the new deal that links Yahoo!'s search advertising business to Google will give the already dominant Google even more influence over the market.