According to the DoubleClick Performics 50 Search Unit Trends Report, search marketers saw their costs rise during the third quarter of 2006. The average cost to a search marketer who purchased a keyword for the quarter rose 20% from June to September of this year.
This increase in cost-per-keyword (CPK) is attributed to an earlier-than-usual jump in pre-holiday season increases.
The report, which uses data collected from the Performics 50 index, which keeps tabs on 50 paid search campaigns, also indicated that search marketers boosted their overall search spending by an average of 38% during the third quarter.
Conversion rates rose 4% from the second quarter, and total clicks rose 3% from the prior quarter.
An emphasis on the importance of understanding CPK was made clear in the report.
“Performics encourages marketers to examine the quality of their programs, including their CPK, as a stable CPK denotes balanced growth in the search program,” said vice president of strategic planning at Performics, Cam Balzer. “If that growth is unbalanced, understanding why helps monitor a campaign. For example, a marketer might see that costs are going up but that revenue is tracking accordingly.”
Bidding for more expensive keywords also saw more action during the quarter.
Sources:
http://www.bizreport.com/2006/12/search_marketing_costs_up.html
http://home.businesswire.com/portal/site/google/index.jsp?
ndmViewId=news_view&newsId=20061218005613&newsLang=en
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