SMBs Rate Google PPC Ads More Effective

July 19, 2007

This article is included in these additional categories:

Local & Directories / Small Biz | Magazines | Paid Search

Small and midsize businesses (SMBs) - but not large ones - rate Google’s keyword search offering as superior to Yahoo’s, according to the second annual Outsell, Inc. study looking at companies’ ad budgets and strategies, broken out by business size:

  • Some 58% of small companies rate Google ads effective, compared with only 32% that rate Yahoo effective.
  • Three-quarters of midsize businesses rated Google search ads effective; slightly less than half rated Yahoo effective.
  • Among large companies, 63% rate Google effective and a nearly identical 62% rate Yahoo keyword search effective.

Among additional Outsell research findings:

  • Small companies devote almost twice as much of their budgets to print as midsize companies.
  • Midsize businesses rate the effectiveness of print trade magazines and events much higher than smaller companies do.
  • Small companies’ share of online ad spending on search engines is more than double the share of medium or large companies’.
  • Click fraud continues to deter some companies from pay-per-click advertising:
    • Large companies estimate that nearly one-fifth of clicks on their ads are fraudulent
    • Small companies estimate that 14.4% of clicks on their ads are fraudulent.

Additional findings from the Outsell report, via MediaPost:

  • The most effective online marketing tool, according to US advertisers, is their company website, to which they’ll devote, on average, nearly 12% of their total 2007 advertising budget.
  • Email marketing and search engine marketing were ranked second and third, respectively.
  • However, nearly half (49%) of companies referred to click fraud as “a serious issue” and said they “planned to reduce, or had already reduced,” PPC ad spend.
  • Nevertheless, search marketing budgets are expected to increase by 40% in 2007.
  • Midsize companies foresee the highest level of online ad spending growth – 63%, versus 14% forecast by small companies and 19% by large businesses.

About the study: Outsell surveyed 1,010 advertisers who target the corporate, healthcare and consumer markets on a range of topics, from budgeting for print, broadcast and online media, to the effect of click fraud on spending decisions. These advertisers control $6.5 billion in spending.

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