Today at the Search Engine Strategies 2006 Conference on Toronto, SEMPO (the Search Engine Marketing Professional Association) announced the latest results of a survey, revealing that few advertisers are prepared for the rising PPC advertising costs. SEMPO is a search marketing non-profit representing more than 380 search-related companies.
The survey found that 4/5 of advertisers said they were capable of handling an increase in PPC costs, but most of them could only handle a PPC increase of 30% or less. Three-quarters of all advertisers have also experienced a PPC cost increase over the last year. PPC marketers have responded by altering spending accordingly, and re-allocating funds from things like affiliate marketing, web development, and other forms of on- and off-line marketing and advertising.
“Despite increasing ad spend and year-to-year growth in the value of search engine marketing, we are likely nearing a pricing plateau as advertisers near their maximum efficiency,” said SEMPO chairman Gord Hotchkiss in a statement. Of the 553 respondents, 71% said they would try to increase their visitor conversion rate, and 62% said they would try to optimize their bidding strategies before reducing their ad spending.