Search Engine Performance Report: ROI up 13% in Q4 07, 97% of Additional Spend Goes to Google

Today we released our Search Engine Performance Report: Q4 2007. We analyzed data across a fixed set of Efficient Frontier clients from Q4 2006 to Q4 2007 to find trends in search engine performance for spend levels, CTR, CPC, and ROI.

Overall spending was up 29% in Q4 2007 vs. Q4 2006, and ROI improved by 13%. Google gained a larger than proportional share of that additional spending: as I've reported before, Google's share of search spend was 77% in Q4 2007, but its share of the spend that clients added to their portfolios versus Q4 2006 was 97%. MSN gained 6% of the additional spending, consistent with its share of total spend, while Yahoo's share dropped by 3%.

Our ROI analysis shows that Yahoo's ROI improved by 39% in Q4 2007 versus pre-Panama Q4 2006, and MSN's ROI was 27% higher than the average ROI across the search engines in Q4 2007. While Google didn't make the largest gains in ROI, its ability to drive volume and consistent performance makes it the engine of choice for advertisers seeking to spend more on search advertising. Click here to download the full report.