Australia's love of online search advertising continues, finds new report

Latest Frost and Sullivan research shows double-digit growth in online search advertising driven by rise in mobile usage, as well as digital marketing practices

A new report shows Australia’s online search advertising market is experiencing double-digit growth and is expected to continue outperforming all other major online advertising segments as mobile search increases.

According to the latest Frost and Sullivan Australian Online Search and Directories Market 2013 report, online search grew 23 per cent between June 2012 and June 2013, exceeding all other types of major online advertising segments including online general advertising such as sponsorships, integrated site content and e-newsletters, classified and directories.

Online search is forecast to outpace online directories over the next five years and chalk up a compound annual growth rate (CAGR) of 16 per cent through to 2018. This will see the total online search and directories market share increase from 83 per cent to 91 per cent within the next five years.

Frost and Sullivan ICT practice senior research manager, Phil Harpur, also pointed out the volume of local search conducted via mobile is growing at a much faster rate than fixed Internet connections. The figure should come as no surprise to any marketers, given smartphones and tablets are increasingly becoming the preferred channel choice for consumers.

A report produced earlier this year by Telsyte also reported mobile search advertising is experiencing faster growth in Australia than expected, representing 30 per cent of the total paid search links being served during the second quarter of this year. The analyst group expected this figure to rise to 33.3 per cent in the fourth quarter of 2013.

In line with this, a Mobile Marketing Association survey across Asia-Pacific found mobile marketing budgets are set to get a big boost next year, with 90 per cent of respondents indicating more spend will be directed at capitalising on rapid smartphone and tablet device adoption. One-third of marketers expected mobile spend to increase by up to 75 per cent.

However, what remains a concern is that many marketers still don’t have formalised mobile strategies in place, running the risk of disconnect in their customer engagement.

IAB and Nielsen launch mobile advertising audience measurement pilot
Mobile ad spending leaps at Facebook
Tablet advertising exceeds smartphone spend in March quarter: IAB

In a sign of rising interest in geo-targeting and location-based advertising, Harpur noted a high proportion of mobile searches optimised for location-based material in the Frost and Sullivan report. In addition, click-to-call features are becoming more prominent in mobile search.

This year’s report also claimed the percentage of advertising budgets going on search advertising and SEO services will increase over the past 12 months, a trend led by the migration from offline to online channels. More than 50 per cent of advertisers divert funds from traditional media advertising towards augmenting their search advertising expenditure, Frost and Sullivan stated, and are increasingly focused on optimising advertising and marketing inventory and services into a single SEO strategy.

Key reasons for search engine advertising activity include the relatively high click through rates, and low cost-per-click on mobile devices.

While Google dominates the market, Sensis’ search advertising offering, Sensis ClickManager, experienced strong revenue growth in 2013, the report stated. Adlux also established itself with solid growth off a small base, Harpur added.

Online directories growth stabilised during 2012-2013 after the slowdown in recent years, with overall revenue growth increasing from 1 to 4 per cent. However, Frost and Sullivan warned Google’s influence and control over the search and online directory space continues to challenge the market and predicted revenues continuing to gradually decline.

Follow CMO on Twitter: @CMOAustralia, take part in the CMO Australia conversation on LinkedIn: CMO Australia, or join us on Facebook: https://www.facebook.com/CMOAustralia

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Show Comments

Blog Posts

Using artificial intelligence to surprise your customers

​We have expected artificial intelligence (AI) will become part of our everyday lives for quite some time.

Katja Forbes

Founder and chief, sfyte

Is customer segmentation dead?

Ginni Rometty, the CEO of IBM, announced the death of customer segmentation five years ago saying, "The shift is to go from the segment to the individual. She might have been a bit premature for most marketers, but if customer segmentation isn't dead yet, it's definitely on life support.

Richard Taylor

Senior digital strategist, Spinach

How people buy brands

Andrew Ehrenberg was a giant in the field of marketing science. He believed scientific methods could reveal law-like patterns of how people buy. In this post, I summarise one of Ehrenberg’s most important discoveries and its implications on how people buy brands.

Kyle Ross

Strategist, TRP

Hey there! it is a really meaningful post. I too have written a few similar articles about SEM, SEO, Social Media, Digital Marketing Tren...

Rohit

Digital advertising continues to dominate marketing budgets

Read more

Thanks for sharing the strategies ! :)

Isabella Richardson

Marketing the most of martech for revenue and CX

Read more

Glad to be a part of this informative post... Thanks for sharing this useful info!!! It is very important to stay updated about the lates...

Aaron Alexis

Predictions: 9 digital marketing trends for 2019

Read more

What the hell is with the "He claims, he claims, he claims" nonsense? That's just not good reporting.

Armaan Alfares

Marketers aren't investing enough in direct response and customer data

Read more

This is a great development in the industry. Thanks for putting this together! We’ve been working with companies to help them build intel...

Giridhar Prathap Reddy

Professional services industry develops hybrid chatbot and live-chat

Read more

Latest Podcast

More podcasts

Sign in