SEM Predictions for 2008
Contrarian, dangerous and potentially humiliating predictions for 08
By Kent Lewis and the Anvil team
Contrarian, dangerous and potentially humiliating predictions for 08
By Kent Lewis and the Anvil team
It’s that time again. For the past three years, I’ve put Anvil out there with what I can only describe as unconventional wisdom about the search engine marketing (SEM) industry predictions. Before I launch into Anvil’s 2008 SEM predictions, I figure it’s worth turning the clock back to December 2005, when we wrote our first set of predictions.
2006 SEM Predictions
In December 2005, I shared four predictions about the SEM industry for 2006. The predictions included: 2006 as THE year for SEO (which it was), continued online advertising growth (which it did). Note: I will point out that we recommended readers purchase Google stock, which is up from $420 to $710 a share during that time period. We also predicted MSN would gain significant market share and was terribly disappointed to be proven wrong, (in fact, MSN’s share hasn’t changed much in two years; it’s hovering just north of 12% today). Next up was significant adoption of offline to online conversion tracking. We weren’t as far off, but it was still disappointing growth, (far too many of our clients are still lagging in this area). Our final prediction focused on video adoption rates. Without the likes of YouTube, the predicted growth may not have turned out as favorably. In terms of accuracy for 2006 SEM predictions, Anvil batted 700, which would get us into the lineup of any MLB team.
2007 SEM Predictions
The SEM industry predictions for 2007 were less controversial, and greater in number. Of the ten SEM predictions, we largely missed on mobile and video search adoption growth. We were more on target with our other predictions: holistic/integrated search, CPA cost structure for PPC, personalized search, advanced analytics and search engine standardization. A bulls eye was in our sights when we called high growth areas out: social media optimization, local search and SEM industry consolidation and diversification. For the 2007 season, we agree on a 550 average.
2008 SEM Predictions
Since Anvil Media is a growing SEM agency, full of talented SEM professionals, I elected to collaborate deeper with the team than ever before. With such a fast-moving industry, it’s virtually impossible for one or two people to stay on top of trends, so I put our 10 heads together to come up with the following predictions for 2008.
Everything Search Engine Marketing
Let’s start with the most obvious one first–everything related to the search engine marketing industry is going to continue to grow, if not thrive, in 2008. “Everything” in this case includes search engine optimization (SEO), pay-per-click (PPC), online reputation management (ORM), SEM PR and my favorite, social media optimization (SMO) which merits its own category (see below). ORM will rise to the top of the media buzz-o-meter with big brands and celebrities hiring firms like Anvil to make negative search results “disappear.” Online ad spending will continue to increase significantly (up $6 billion over 2007) as traditional ad spending levels off due to the fear of an economic downturn. If you’re not in the SEM industry now, you may not be able to ignore the pending recession.
Online Advertising Options Evolve
Display advertising may see a re-emergence as brand budgets move online in search of better measurability. While rich media ads will continue to have a seat at the table, in-text advertising will be the big winner in 2008. Key players like Kontera and Vibrant Media will cash checks when consumers test and accept the relatively new contextual advertising model. Google’s $700 stock price is proof that contextual advertising can work.
Google Cross-Platform Bid Management Tool
Google will launch (we hope) a cross-platform bid management tool (API based; to work across engine platforms including Yahoo Search Marketing & MSN AdCenter). This prediction is based on the move Google made this year to allow AdWords advertisers to opt-in to the new “Conversion Optimizer” and the technology/interface they have continued to develop with AdWords Editor. Watch out third party vendors like Atlas, SendTec, and SearchForce! Google could end up disrupting the bid management industry like it did with Web analytics when it purchased Urchin and gave away the platform as Google Analytics. It looks like Omniture could get stung twice as badly, offering products and services in both markets.
Mobile – No, Seriously This Time
Apple’s iPhone stole the show at CES in early 2007, and Steve Jobs and his phone weren’t even there. Since then, the buzz has set new standards and consumer expectations. Phone manufacturers and carriers are now forced to step up with more advanced technology that will get the US out of the Stone Age (in comparison to the rest of the world). That means SMS text messaging will gain in popularity and usage (especially by smart restaurants, hotels and retailers). Additionally, mobile advertising will reach $5 billion in 2008 (up from $3 billion in 2007), fueled in part by search-based ads.
Social Media
US ad spending on Web 2.0 social networks will climb to nearly $1.6 billion in 2008…which is a significant increase over 2007. That said, the long-term success of social media sites will rely on the ability to manage one profile (yours) across a multitude of sites. Lacking that key ingredient, only a handful of existing social media sites will survive. Assuming portable profiles don’t come to fruition in 2008, we predict MySpace, Hi5 and other spam-friendly sites will die on the vine (at least increase user growth at a decreasing rate), while other startups social media sites like Spoke, Doostang, Spock and Biznik will fail to find enough traffic or revenue to survive the year (certainly not beyond 2009). Facebook will struggle to find a viable business model (certainly the initial foray into advertising is generating a negative response from users), but the open API will continue to fuel growth. LinkedIn will gain ground and become the de-facto Web 2.0 social network site for business professionals (followed in a distant second by Plaxo). In a massive consolidation move, Google, MSN and Yahoo will continue to buy up social media properties, if for no other reason than to kill them off. Lastly, social media optimization (SMO) will experience significant adoption by B2B marketers, which is important because the Web’s significant growth has been fueled by businesses and not consumers.
Google/YouTube Television
With fanfare that will put MTV’s launch to shame, Google’s YouTube will launch their first foray into broadcast television. While initial efforts may be through a broadcast partner (RE: ABC or Bravo) but will eventually move to a dedicated cable station, where they will show the best and worst videos YouTubers have to offer. Even if the station doesn’t take off for a few years, it will likely fare better than Revver’s Fame TV in the UK.
Consumers Controlling Conversation
As companies look for additional ways to attract and retain site visitors, a new technology will emerge:Attention Profiling Markup Language (APML). APML will change the way advertisers target end users. As more companies adopt AMPL, users will be given the opportunity to control their own attention and share it with service they wish – giving advertisers the ability to target based on what the user wishes to see. Social media sites like BizRate and ePinions have demonstrated consumers own and influence brands with which they interact and identify, so the next logical step is for consumers to control the entire conversation. Only the biggest brands and most aggressive B2B companies will pursue this technology initially, but it will generate meaningful buzz in 2008 (although don’t expect much in the way of meaningful adoption or revenues until 2009 and beyond).
Googling Oneself Even More Popular
In 2007 we saw even more American’s flocking to Google themselves, friends, partners, and even co-workers. Pew Internet released a study earlier this month that said 47 percent of U.S. adult Internet users have looked for information about themselves through Google or another search engine. This is more than twice the 22 percent of users who did so in 2002. But with all this searching, 60 percent said they aren’t worried about the extent of information about themselves online. We think this statistic will change in 2008 when searchers realize that as Google and other engines get better at indexing and ranking all types of content in one screen (think Universal Search), then they had better clean up their act and make some information private. If it’s too late for some, please contact us at Anvil Media and we can do an Online Reputation Audit and develop a strategy to combat the negative results.
As I’ve said every year, feel free to revisit this article in December of 2008 and see how well we fared on the accuracy of our SEM predictions. So far, our career average is 625, but with a bigger and better team on the bench at Anvil Media, I’m hoping we can bring it up with a 1000 average in 2008.