Three PPC Predictions For 2010

Now that we’re firmly planted in 2010, I think it’s time for a few predictions for the coming year. And, since this blog is quite obviously concerned with pay per click marketing, I’m going to stick with what I know. Here are what I think the big three developments for PPC will be in 2010:

1. Yahoo and Bing will join forces, but still won’t match Google for PPC marketshare.

In July 2009, Yahoo and Microsoft announced a deal that would eliminate Yahoo search and replace it with Bing. Of course, as in all major business transactions, this deal has taken quite a while to materialize. Yahoo and Microsoft just finalized their deal in December 2009, and are anticipating a rollout of the new functionality in early 2010.

This is obviously big news for the PPC world. With Yahoo Search Marketing leaving the market space, that only leaves two major PPC providers – Google and Microsoft. With billion-dollar budgets at their disposal, this is sure to be a corporate slugfest for the ages.

However, I’m convinced that Google is still going to come out on top on this one. Let’s crunch some numbers. An August 2009 study by Search Engine Watch indicates that Google gets about 65% of total searches, Yahoo gets 15%, and MSN/Bing gets about 10%. Looking exclusively at PPC market share, a Rimm-Kaufmann group blog in March 2009 shows that Google dominates with 80% of PPC market share, while Yahoo gets about 15% and MSN/Bing lags with only about 5%. Even after Yahoo and Bing join forces, they will only get about 25% of web searches and 20% of the PPC money out there. I’m optimistic about Bing, since it has showed some great momentum since it’s launch, but I think we need to be realistic here. Google will dominate PPC spending for quite some time, since their company name is synonymous with web searching in a lot of web users’ minds. Microsoft is going to have to do a lot more than just take over Yahoo’s search market share if they want to put a dent in Google’s profits. This won’t happen any time soon, and certainly not in 2010.

2. Mobile PPC spending and use will continue to increase.

This is a pretty obvious one. More smartphones are being purchased with every passing year, and with that comes an increase in mobile internet use. Google made a big bet on the mobile ad market in late 2009 when they announced the acquisition of mobile ad provider AdMob. Google has also made significant improvements this year to mobile ad tracking in their Google Analytics platform. Yahoo offers a robust mobile advertising platform for display advertising, and Microsoft inked a deal to be the exclusive search and advertising provider for Verizon mobile phones. With the big three making such big pushes into the mobile advertising space, we’re sure to see some interesting developments in the coming year. The only question that remains is how will users of smartphones react to the encroachment of advertising on their mobile experience?

3. Social network PPC advertising rises, then falls flat.

Social networking has definitely been on everyone’s mind in 2009. With the explosive growth of Facebook and Twitter in the last year, advertisers have been wondering how to capitalize on the user bases of these extremely popular sites. To better monetize their products, both Facebook and MySpace have created advertising platforms to businesses who want to reach out to their users.

This is a really tempting proposition. Social networks have access to an unparalleled amount of demographic data that allows for hyper-specific targeting. On the surface, this seems like a great deal, and I think it’s going to attract a lot of advertising dollars in the coming year from businesses who don’t understand social media, and are looking for a shortcut to get presence on these sites. However, from my personal experience (and a few other folks I’ve talked to), social media ads tend to get really terrible results. You can already target MySpace, YouTube, and a few other social sites through Google’s content network, and let me tell you that the results aren’t pretty. You certainly get a lot of impressions due to the massive amounts of users, but you’ll also get a lot of errant clicks. What you probably won’t get, though, are conversions.

People go to social network sites to be social – they’re not there to buy things, fill out lead forms, or learn more about companies. This is the inherent flaw in any social network PPC campaign. Sure, you can pick up some good brand recognition through clever banner ads, but I wouldn’t expect anything good from text ads. The reach is good, the demographic targeting is good, but the user intent just isn’t there.

So here’s what I think will happen in 2010: businesses will get sucked in by the promises of awesome demographic targeting, and consultants telling them they need to get into “the social media thing.” Then, after a few months of mediocre results, they’ll realize that the ROI just isn’t there and they will pull the plug on their social network PPC campaigns. 2010 will be the year of boom and bust in the social media PPC space, unless Facebook and MySpace can figure out how to make ads more engaging to their user base, and more profitable for their advertisers.

There you have it – three PPC predictions for the coming year. We’ll see if I’m right this time next year. Got some predictions of your own? Let’s hear them in the comments.

About Shawn Livengood

Shawn Livengood is a search engine marketing professional based in Austin, Texas. He has extensive experience managing pay-per-click ad campaigns for clients in various industries, from small home-based businesses to large international companies. You can connect with Shawn on Google+.
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