Commentary

Search Marketing To Capitalize On Tablet Growth

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The explosion of content geared toward a variety of computer, cloud and mobile devices will continue to drive search marketing budgets and strategies. Welcome to 2011 and a new year of Search Marketing Daily.

As J.P. Morgan Analyst Imran Khan points out in a report, Nothing But Net, released Monday, the cost of content creation and distribution continues to decline, providing opportunities for businesses. To survive, however, I believe traditional media companies will need to tap resources from Google and other search and tech companies to address their inability to fulfill consumer demand. These are the same media companies that threatened to put up pay walls and shut out search engines in 2010.

As time on the Net continues to grow, online publishers will experience stronger advertising sales. J.P. Morgan estimates global paid search revenue to grow at a 17% compounded annual growth rate (CAGR) during the next four years and global graphical advertising to grow at a four-year CAGR of 11%. Overall, the forecast for global online advertising should reach about $105 billion by 2014.

Some of that growth this year will come from the emergence of tablets, I believe. This year I suspect AT&T, Verizon and others will finally create and standardize affordable pay as you go Internet services. The tablet will create new opportunities for advertisers targeting consumers who don't want to download movies or content to read or watch on small devices such as Apple iPod or Google smartphones powered by Android. An online ad game changes begin talked about this morning across the Internet include a Google digital newsstand, a move that in my opinion would have far more reaching positive implications for newspaper and magazine industries in terms of local advertising than some might realize.

Mark Moskowitz, J.P. Morgan's hardware analyst, estimates 46 million tablets sold in 2011. The investment firm cautions against failure to understand the mobile audience. In the report, Khan explains the dangers for content aggregators, publishers and advertisers.

Mobile search is one of the Top 10 innovations Khan will continue to watch in 2011. He calls monetization of mobile searches a critical factor for Google's growth. J.P. Morgan estimates Google generates about 15% of its query volume from mobile devices, yet mobile searches contribute just 3% of revenue.

Will Google Android take the tablet market? In the electronics industry, typically the first to market wins. While Apple's iPad and Samsung's Galaxy Tab led, a tablet the size of Kindle or Nook provides consumers with a portable device, and more space to browse, compared with mobile phones. So, the Via Tablet running Android from Visio shouldn't come as a surprise. Expect Visio to unveil the device at the Consumer Electronics Show (CES) in Las Vegas this week. It will sport an 8-inch, high-resolution screen; WiFi wireless connectivity; three speakers; and a front-facing camera for video conferencing. CES watchers also expect Lenovo to launch tablets.

Google's attempt might work to get back in the good graces of publishers like Time Warner and Conde Nast and Hearst by agreeing to take a smaller slice on any sales made from Android apps, at least smaller than the 30% cut Apple typically takes on iTunes sales. The idea might work not only to increase readership, but also local display and search marketing ads lumped in with mobile.

Besides, the app and the ad markets for tablets are much bigger than newsstands. Scholastic Media debuted Monday under the new brand Touch & Tilt its first children's storybook apps designed for the iPad. The apps feature animated interaction to engage children with the story, ability to touch the words to hear the story, and music and sound effects.

3 comments about "Search Marketing To Capitalize On Tablet Growth".
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  1. Nathan Safran from Conductor, January 4, 2011 at 9:52 a.m.

    Hi Laurie,

    So as tablet adoption continues to rise, do you see search marketers benefiting from the trend with increased searches or do tablet users turn to apps for their information needs?

    Regards,

    Nathan

  2. Laurie Sullivan from lauriesullivan, January 4, 2011 at 11:19 a.m.

    Hi Nathan, I see search marketers benefiting both from increased searches and apps. For me, however, apps are too limiting. I rarely use the apps I download on my iPad. Yes, I took the time to download them, but unless I want to listen to music on Pandora or iTunes, it's too restricting. My iPad doesn't get much use these days other than to download and play movies. It gets connected to 46-inch Sony with Google TV and acts as an external drive. I'm still waiting for the iPad to wow me. I haven't given up. I'm still looking. Maybe that's why I think increased searches will do more than apps for marketers.

  3. David Szetela from Clix Marketing, January 4, 2011 at 5:53 p.m.

    Great insight, Laurie. I encourage you to look at tablets through the eyes of first-time computer users. Gesture-based interfaces are more usable to many people who would rather not use a keyboard or mouse. eCommerce through apps is growing and could someday dwarf sales through browsers and web sites. Try buying a Kindle or Nook book, or an item via Amazon's WindowShop. No browsing, no typing - just tapping!

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