Ad Age: Internet Search Engine Advertising Show Major Gains

Ad Age published a piece on large marketers awakening to the pleasures and pains of search engine marketing. Most interesting is the implication noted toward the end of the piece by a Hewlett-Packard executive that most of the search market growth in the last few quarters has come more from price increases than and increase in sales.

This may imply that, just as major marketers are starting to come into the market to bid up the prices of relevant keywords, they might be getting priced out of the market. Some industries and some types of companies within industries will be able to make a margin on keyword inventory at a higher price than can other types of firms. Those companies will, naturally, bid the price up to the necessary levels to secure the inventory, leaving entire sectors of the economy with the new reality that search engine inventory is too expensive to consider. This also may be where companies begin to experiment more rationally with non-search media.