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Paid search slows while vertical grows

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Marketers spent $2.6 billion on paid search in 2004, a number that will climb to $3.2 billion this year and $5.5 billion by 2009, according to Jupiter Research.

"Paid search growth remains strong, but it's beginning to slow," said Jupiter Research analyst Niki Scevak. However, one area, vertical search, has grown in popularity, and Scevak said he has seen marketers reallocate dollars toward it.

Vertical search was a major topic of conversation among attendees and speakers at Jupitermedia's Search Engine Strategies Conference in New York two weeks ago.

"We're not saying vertical search will replace Google and Yahoo!," Scevak said. "Think of it as a new layer being placed in the user's experience. The vertical search experience as it currently stands is incomplete. Vertical search is more a step in the middle than a replacement."

Jake Winebaum, CEO of vertical search directory Business.com, agreed. "I don't think specialized search in any way replaces general search," he said, comparing it to network TV and cable. Business.com in fact partners with Google to expand its directory. "When someone is searching for something not displayed in our directory, we'll display Google results," Winebaum said.

Both Yahoo! and Google are pursuing vertical search, too.

"As people want to narrow their context, we will provide a way to search more focused, more vertical areas," said Jerry Yang, co-founder and director of Yahoo! Yahoo! is in the vertical market already with its comparison shopping site and its recent acquisition of Farechase, an Internet travel site. Google's shopping site, Froogle, likewise provides a vertical platform. M

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