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Small-Biz Search Ad Growth Slows in 3Q10

October 27, 2010

Small-business advertisers spent on average $2,373 on search advertising in the third quarter of 2010, up 43% from the $1,658 spent in the same period a year earlier, and up 6.4% from the $2,231 spent in the second quarter of 2010, according toWebVisible study based on its small-biz clients.

Though the growth is strong, it's lower than levels recorded in the three previous quarters, when year-over-year (YoY) spending was up 159% in Q210, 91% in Q110, and 111% in Q409.

The slowdown likely signals that small business search advertisers are closing in on the optimum level of spending they need, WebVisible notes. Additionally service providers are refining their ability to determine efficient spend amounts in order for advertisers to achieve the highest return on spend.

Advertisers increased investments on keyword inventory: The average keyword count per advertiser, which represents root keywords (vs. individual bid units with geographic modifiers), increased to 78 keywords in the third quarter, up 41% from Q309, and up 4% from previous quarter.

Below, other findings from the State of Small Business Online Advertising for the third quarter of 2010.

Search Engine Trends: Bing Rising

Spending shifted toward Bing (up 37% quarter on quarter (QoQ)), Yahoo, and Ask in the second quarter, and away from Google: 

  • Bing accounted for 14.5% of search ad spend, up 3.7 points from the previous quarter.
  • Google accounted for 52.4%, down 5.9 points QoQ, and down 8.0 points YoY.
  • Yahoo accounted for 28.3%, off 1.4 points QoQ, and up 2.1 points YoY.
  • Ask accounted for 4.8% of search ad spend, up 3.5 points QoQ, and up 2.4 points YoY.

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