SEO & PPC budgets set to double by 2014

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  • July 8, 2009
Patrick Altoft

Patrick Altoft

Director of Strategy

Good news for those of us in the SEO industry as new figures from Forrester predict spend will increase steadily over the next 5 years.

The chart below shows the predicted increase in spend for the US – it’s fair to assume the UK market will follow the same trends.
SEO & PPC spendAccording to the report interactive marketing will near $55 billion and represent 21% of all marketing spend in 2014 as marketers shift dollars away from traditional media and toward search marketing, display advertising, email marketing, social media, and mobile marketing. This cannibalization of traditional media will bring about a decline in overall advertising budgets, death to obsolete agencies, a publisher awakening, and a new identity for Yahoo!

Although the figures are pleasing it’s hard to see how PPC spend can increase much further in developed markets. Most clients we work with running maximum budgets to gain every click possible and a lot of markets are already saturated.

Natural search on the other hand has huge potential because of the large disconnect between the amount people are happy to spend on PPC and the amount they spend on SEO. In some industries brands are spending 10-20 times as much on PPC as SEO and yet natural search drives over 75% of all search traffic.

SEO drives 75%+ of all search traffic, yet garners less than 15% of marketing budgets for SEM campaigns. PPC receives less than 25% of all search traffic, yet earns 80%+ of SEM campaign budgets.

The big difference between PPC and SEO is the ability to easily broad match across loads of keyphrases – with SEO you need to work on difficult things like building up trust and expanding content using an intelligent site structure. It’s far easier (and perhaps even cheaper in the short term) to just buy keywords than to create tens of thousands of optimised landing pages.

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