SEM Predictions for 2008

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For the past two years, I’ve put forth predictions for the SEM industry. You can judge the accuracy of the 2006 and 2007 predictions for yourself and determine whether it’s worth reading my 2008 SEM predictions. If you like them, I’ll take all the credit. If not, blame the rest of the Anvil Media team, as it was all their ideas. Enjoy.

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.

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7 Comments

  1. Good job as usual...however, I'm much more bullish on Facebook & bearish on Linked-In than you...I think Facebook will adapt for business much better than Linked-In will adapt for social media.

  2. Excellent and insightful, Kent. I have to say, I'm also a big fan of LinkedIn. Though not built on as social a framework as Facebook, LinkedIn no doubt works, and works well. Even with moderate activity, you get good, bottom-line results using the service. As for Google: I believe they've opened THE single most exciting opportunity for businesses looking to radically enhance their online reputation. Universal Search is the baby, and it's only bound to get better. I believe it will create big new advertising opportunities for companies focused on natural search. Thanks again, and cheers to a phenomenal '08! Mark Alan Effinger RichContent.tv

  3. In regards to the mobile channel its definately going to be a better year than 2007. But, its activity as of late has been on "strategy" and "Planning" many brands are trying to determine their way while the savvy (as you correctly state restraunts, bars, retailers) figure this "mobile thing" out for everyone else. However, I would say the paid search on mobile is one that is more in line with "traditional" advertising brands that allows them to "participate" in the mobile space but not really go all in quite yet. Its easy to buy ads and say you are doing a "pilot" and its another to jump all in. When we see those big brands pushing major mobile promotions, campaigns and new exicing mobile content then we know its here to stay. Being a partner in a mobile marketing company I'm betting that 2008 is the year we see larger numbers cross over from just playing to full participation!! Great article, Tom Walls

  4. God, I hope your third prediction is realized in 2008. It got to the point where by the end of the year, I dreaded the days when I had to manage my accounts in any engine except Google. A tool like that would easily be my most welcome change in the industry this year.

  5. Nice job even taking this on Kent. I agree with most of what you see happening and would only add that Asia will see the tremendous growth in online marketing and search marketing in particular. I think APML is certainly the way to go but it will take a long time to become viable and don't know about the early adopters you mention. Of course with disappointing results and privacy issues from behavioral target marketing maybe that will be what it takes to get things moving. Yes I Google myself but don't like what I see. Apparently I'm a cold blooded killer, yikes. Great showcase for reputation management I suppose.

  6. I am particularly interested in APML... this has great possibilities among information seekers. In the Internet information age when we have access to all knowledge how are we to cut through the thicket to arrive at what is true for our purpose. When we know it all... do we know anything? This is the great information paradox that the Internet is quickly spawning. I'll be keeping my eye on this technology. Charles Heflin SEO20/20

  7. As a vendor of PPC management software across networks, we (Adapt) also hope that Google doesn't come up with a cross-network PPC Manager! ;-)