San Francisco, April 17, 2006-- In the first quarter of 2006, the average price that advertisers bid for keywords on search engines dropped three percent to $1.39 from $1.43 at the end of 2005, according to the Fathom Online Keyword Price Index.
Fathom Online has tracked keyword prices consistently for the past 19 months and significantly expanded the Index this year. Following on the Q4 2005 holiday season, the drop in bids was not surprising given the seasonal nature of advertising.
Overall, the average bid has increased 1.4 percent since the September 2004 inception of the KPI when the average bid was $1.37. Although prices often vary dramatically day to day, average bid prices have settled in to a predictable range.
“Search marketing is growing at a robust 25 percent this year, and price stability helps that growth” said Matt McMahon, vp marketing services at Fathom. “As advertisers see a more predictable keyword bidding environment, confidence in the channel grows and advertisers continue to invest further in search marketing.”
Methodology. Fathom Online tracks keyword bids through its Triton data collection, aggregation and reporting platform. In the first quarter of 2006, the keyword list for the KPI was expanded from 4,000 generic keywords across eight categories to more than 20,000 generic keywords across 12 categories. Evaluated on select search engines, keyword averages are reliable indicators for media buyers, but are not to be considered proxies for the financial state of the search industry.
Fathom Online publishes the KPI average on a quarterly basis in the press and on its newly redesigned website, www.fathomonline.com, and will from time to time track and publish keyword prices associated with events and holidays of interest. Fathom search marketing clients have access to the complete data set including both the category data and the raw data.
Categories tracked include: Automotive, Computing (new), Consumer Services, Electronics (new), Finance Investment, Finance Mortgage, Health (new), Media and Entertainment (new), Retail, Telecom Broadband, Telecom Wireless and Travel and Hospitality.
