Paid Search Most Important Online Marketing Component: MagnaGlobal

Online advertising expenditures will reach $61 billion in 2010, and paid search advertising will make up nearly half of that, according to MagnaGlobal.

That $61 billion figure, which accounts for worldwide spending, represents a 12.4% increase from 2009’s $54.26 billion.

Don’t look for that direction to reverse itself anytime soon: MagnaGlobal foresees low-double-digit growth for the online channel through 2015, when spending will reach $102.9 billion.

Global spending on paid search amounted to $29.79 billion, or 48.8% of all online spending. By 2015, if MagnaGlobal’s forecast holds true, it will make up more than half of online ad spending – 52.1%, to be exact.

Within North America, paid search made up 48%, or $13.05 billion of the $27.2 billion spend on online advertising. Unlike the rest of the world, its growth levels won’t bring it above the 50% level in 2015. That year, according to MagnaGlobal, it will amount to $22.27 billion, or 49.2% of the $45.24 billion in online expenditures.

According to MagnaGlobal, Google is still the global leader in search. But other companies in the fastest-growing markets – China and Russia, specifically – have put up barriers to Google, allowing home-grown players such as China’s Baidu and Russia’s Yandex to become dominant. Predicts MagnaGlobal: “The enormous influence – and profitability – of paid search increases the probability of governmental involvement in many countries in the years ahead. Such actions are unlikely to constrain the medium’s growth.”

Among non-search online advertising, the landscape is much broader, with Yahoo, Microsoft and a variety of publishers scooping up much of that online ad revenue. But MagnaGlobal warned that as social networking sites such as Facebook capture a large and growing share of audience time, the influence of Yahoo, Microsoft and the publishers will become diffuse.

Based on region, Latin America should be the fastest growing region, with a 13.3% average growth rate pushing its current $1.84 billion in online spending to $3.5 billion in 2015.