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The Geo-Google Threat, 2004

Staff Writer
Published: 2004-10-05

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Research and Markets has added The Geo-Google Threat, 2004 to their offering. While growing 174% to more than $2.5 billion in 2003 paid search remains a largely national business used mostly by those who sell their products online.

A far bigger prize is the $22 billion spent on advertising by small and medium businesses targeted at local consumers to drive in-store sales.

This Geo-Google Threat report investigates the little understood phenomenon of local paid search advertising, which has been largely overlooked amid the rapid rise of search advertising by larger online companies without geographic constraints -- but which, in fact, could end up dwarfing them in both scope and revenues.

Both Google and Yahoo! recognize the opportunity in local search and are rolling out improvements designed to make it easier to locate local businesses, and to improve the ways advertisers target local users. And that could be very bad news for local newspapers and yellow pages.

The Geo-Google Threat report answers these key questions:

-- How fast is local paid search growing?

-- Who are the key players?

-- Who has the most to gain?

-- Who has the most to lose?

-- How will newspaper advertising be affected?

-- Are local radio and TV ad revenues at risk?

-- What about yellow pages?

-- How big is Google's lead?

-- Can it be caught?

-- Why is all this activity good news for local advertisers?

-- And many more...

Here is an example of the type of statistics and analysis that fill the report:

Text Ads Have Many Advantages:

In a world where graphical banner ads have been expanding, and ever more intrusive formats have been developed in an effort to make them effective for advertisers, it is instructive that simple text links get noticed and clicked at higher rates. Much of that is because they are highly relevant to the topic of the search and appear prominently along the right hand side of Google pages. But research has shown that many people have trained their eyes to skip over images that have the size and placement normally associated with ads. That's not so with text ads, it seems. Some might argue that this is because users may mistake them for search results. Another factor favoring text ads is the growing use of ad-blocking software, including Google's own pop-up-busting toolbar.

While reader reaction to text ads is important, the equally significant production benefits to advertisers should not be overlooked. Text ads are easy and cheap to create. You don't need artists and designers, let alone Flash programmers, to create them. You don't have to worry about a variety of sizes and formats. In fact, you can run several different messages and test, which draws the most clicks, then easily modify the messages. Sure, the messages can't be as clever or eye-catching as an animated GIF or Flash ad, but what works best?

The power of text ads isn't new to newspapers, of course. Isn't that what classified ads are? And many newspaper websites have created "Top Jobs" or similar offerings using text links. Text-based email advertising also remains popular. Publishing sites most likely will always offer "display" ad banners, but it makes sense to considering finding ways to integrate simple text ads, particularly in places where they can be highly contextual.

You will find more comparisons, charts, graphs and analysis inside The Geo-Google Threat report.

Information Sources Include:

-- BizRate.com

-- Kelsey Group

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