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The Next Big Thing In Online Ad Revenue

Staff Writer
Published: 2004-02-17

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To buy or not to buy? That is the question when it comes to paid search advertising.

Some big name companies such as Google and Yahoo! are trying to persuade small businesses to pay for online advertising - even if those businesses do not have websites.

Will it work? As online advertising continues to become increasingly important, many small businesses may soon have to start venturing into the Internet territory for potential.

Why? Because more and more customers are using the convenience and the vast resources of the Internet to fulfill their shopping needs.

Earlier this week, the Kelsey Group and Bizrate.com released survey results showing that the percentage of online shoppers using local search to find what they want has increased significantly. More than doubling what industry experts had originally estimated, the findings revealed that local searches represent over 25% of all searches being conducted by online shoppers.

Online advertising revenue has hit a record high on both sides of the Atlantic and industry estimates have shown that search marketing is largely responsible for the boost in sales.

Search engines are now trying to make it easier and more convenient for online shoppers to find what they're looking for. Last year, Google introduced a test version of its localized search engine (http://labs.google.com/location) and back in October it began allowing advertisers to target specific geographic regions.

But Google is not alone. Yahoo, one of Google's top competitors, also plans on implementing local search into its paid search advertising service Overture.

"Consumers are increasingly using search for shopping related queries," says Chuck Davis, President and CEO of BizRate.com. Noting that more than one third (36%) of all performed are currently based on shopping, Davis adds, "We expect to see shopping searches continue to increase."

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