#RSS Home A Battle Plan for MSN Search The 70/30 Rule of Search Search Engine Guide Small Biz Guide to Search Marketing | Affiliates | Newsletters | Advertise | About | Site Map Search Engine Guide Blog Search Engine Marketing Internet Search Engines Marketing Products & Services see your site here Navigation: Search Engine Guide Home Page > Gord Hotchkiss > Rashtchy's Golden Search turns Platinum Gord Hotchkiss Articles - Bio Free Newsletters Search Marketing Our weekly search engine marketing newsletter will help you understand search engine optimization, link popularity, pay per click, search engine submissions, and more. __________________ Subscribe Your email address will NOT be given to third parties. Small Business The weekly Small Business Brief provides a digest of small business ideas and articles that inspire, inform and generally keep small business owners up to date with the information they need to succeed. __________________ Subscribe Your email address will NOT be given to third parties. sponsors Web Hosting Find cheap web hosting companies Web Directory Add Your Url Today Web Hosting Windows Hosting and Linux Hosting Website Hosting Directory Web hosting links, forums, FAQs Search Engine Optimization Ethical SEO, Top Rankings carcasherdotcom seocontest for babies Learn how you can help premature babies with just a link. Rashtchy's Golden Search turns Platinum By Gord Hotchkiss - May 27, 2005 Printable Version ON NOVEMBER 9, 2004, Piper Jaffray analyst Safa Rashtchy dropped a bombshell on a small handful of people at the New York Ad:Tech show. He doubled his search revenue projections for the next five years. And, he bumped these projections less than two years after they originally came out. Back then, Rashtchy's $7 billion by 2007 revenue projection was quoted everywhere. You couldn't turn around without seeing a reference to these amazing growth predictions. And now, he nonchalantly walked up to the podium and said search revenue in 2007 will be more like $13.5 billion! I was sitting in the audience and my jaw dropped. But a strange thing happened this time. Nobody seemed to care. In preparing for this column, I scoured the Internet for any mention of Rashtchy's exciting announcement. I found nothing. While it's not surprising that the announcement missed the mainstream press, I can't believe our own industry didn't pick up on it. I finally had to resort to contacting Rashtchy's team and getting a copy of his presentation. In the process, I asked Rashtchy why the announcement didn't seem to gain attention. His response indicates that the lack of attention means search is now accepted with more credibility: "I think search is now accepted as a big business. You have a $60 billion company on the market doing only search, so people are saying that with these valuations, we expect that you will up your estimates significantly." Sorry Rashtchy, Better Late than Never.... I think the readers of this column would be well served to get the high points of Rashtchy's announcement, so let me share them with you. First of all, the growth numbers. In March 2003, Rashtchy estimated that worldwide search revenues would hit $7 billion by 2007. Just a few months later he was quoted as saying that these numbers are likely too conservative. With last November''s presentation, he had the opportunity to bump those numbers up. Rashtchy now feels we'll not only hit that target, but surpass the 2007 - $7 billion mark this year. Next year, he predicts search revenues to top $10 billion, and then hit $13.5 billion in 2007, $16.2 billion in 2008, $19.8 billion in 2009 and top $23 billion in 2010. Factors of Growth Rashtchy feels there are a number of revenue drivers fueling the growth: A second wave of small business just discovering search The international growth of search Discovery of the branding value of search The growth of contextual search, with local search perhaps poised to take over In addition, he sees four immediate and fundamental drivers of search growth. He collectively refers to them as T.C.P.C. Traffic - More people doing more searches, especially commercial searches Coverage - Expansion of keyword baskets, monetizing more search terms Price - Increasing prices per click Conversion - As we get better at converting clicks to buyers, advertisers are willing to bid more Local Search Rashtchy feels that local search could become a significant driver of new search revenue. I know there are mixed opinions about this (I for one agree with Rashtchy on this one and have said so in previous columns), but I think the salient point here is that local search, if successful, dramatically increases the market size for Google and Overture. It takes search from a global consumer activity and brings it back home. It ties the Internet much closer to our day-to-day shopping activities. It will take a few years for local search to make much of a difference in overall search revenues, but once felt, the impact will be significant. Search Efficiency - It Still Can't be Beat In comparing methods for customer acquisition, search still comes out far ahead. Piper Jaffray estimates the average customer acquisition cost for search to be between $7 and $10, compared to $15 and $25 for Yellow Pages, $40 to 80 for e-mail and $60 to 80 for direct mail. Search is growing because it works. Bottom Line Rashtchy summed up with five conclusions that state the future potential of search in no uncertain terms: * Search is likely to become the most successful marketing method for all businesses * Local search is a huge force that could change the dynamics of search for online-only merchants, putting them at a big disadvantage * Concepts like broad match could make search an effective soft sell, suggestive advertising mechanism * Merchants should focus on customer conversion and extending the customer life cycles * Search providers should focus more on merchant conversion rates and offer lower charges for broad match and contextual search. They should also focus heavily on local and international expansion. Discuss this article in the Small Business Ideas forum. ________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________ Navigation: Search Engine Guide Home Page > Gord Hotchkiss > Rashtchy's Golden Search turns Platinum ________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________ Gord Hotchkiss is President and CEO of Enquiro, Canada's leading search engine marketing firm and one of the top firms in North America. His articles are regularly published in both on and off line newsletters, including Marketing Monitor, SEOToday, Marketing and many other trade journals. Enquiro's own information portal is www.searchengineposition.com. With an extensive 20 year background in the marketing and advertising business, Gord has been working to increase client's search engine visibility since 1996 and has specialized in search engine marketing since 1999. blinklist : del.icio.us : DIGG : furl : shadows : simpy : spurl : yahoo Google _____________________________________________ Search (_) Web (_) searchengineguide.com Search Engine Guide Blog | Search Engine Marketing | Internet Search Engines | SEM Resources & Consultants | Newsletters | Advertise | About | Site Map Small Business Brief | Small Business Ideas Forum | Small Business Marketing | Small Business Resources | Small Business Software | Small Business Opportunities Copyright © 1998 - 2006 K. Clough, Inc. All Rights Reserved. Privacy