• by Laurie Sullivan  @lauriesullivan, January 18, 2011

Marketers increased the amount spent on U.S. search campaigns between October and December 2010 -- especially retailers -- compared with the year-ago quarter. Spend rose 35.5% overall and 36.6% in retail, according to the SearchIgnite Q4 2010 U.S. Search Market Report released Tuesday.

Paid-search spend bounced back in 2010, making the line on the graph decline slightly in Q3, but climbed like a hockey stick during the final quarter. Marketers increased spend by 18.5% last year.

Compared with the prior year, findings also point to a 20.6% year-on-year increase in clicks for Q4 2010, a 2.3% increase in impressions, and a 17.9% increase in click-through rates (CTRs). Metrics in Q4 show positive results with a 20.6% year-on-year increase in clicks, a 2.3% increase in impressions, and a 17.9% increase in CTRs.

Economic uncertainty in 2009 stopped marketers from opening budgets and planning ahead. Uncertainty regarding how consumers would spend kept wallets closed. That changed in 2010, and experts believe it will begin to get "substantially" better in 2011. Retailers will spend more as consumers buy more.

"We're seeing strong sentiment among clients for the potential in 2011," says SearchIgnite CEO Roger Barnette. "I think it could become a very positive year across the board."

The price of keywords fluctuated depending on the search engine. In Q4 overall, the CPC on Google rose 9%, whereas combined Yahoo and Bing came in flat. Demand for a word or a phrase drives up the price of keywords or terms. Using branded keywords can sometimes help marketers control costs. Brand owners will typically pay the least for their branded terms. One of several reasons this holds true is because consumers are three times more likely to click and convert on the terms, so Google makes its money more easily.

So American Express would pay less for the same term than their competition. That's why it's important for marketers to bid on their own branded terms, Barnette explains. It may seem obvious, but if someone is searching on Google typing on a marketers' brand term they are typically ready to buy. If the marketer isn't bidding on its company's branded terms than they are missing an opportunity.

No surprise that Google's share of U.S. paid-search advertising continues to grow, ending Q4 at 82.6%. The combined Bing and Yahoo market share fell to 17.4%. Barnette believes it's still too early to tell whether the Bing-Yahoo relationship will work. Using war terms, he says Internet marketers were in the "throes of battle in late October" because campaigns picked up and strategies can change quickly.

Marketers should view the Bing-Yahoo integration as a new opportunity, but few seem to take advantage. Barnette says they should develop and test new creative pieces and ad copy, analyze conversion rates and look for the ad copy combination that delivers the best conversion rate.

Do everything companies have been doing in Google AdWords for years, but now it's time to start from the beginning on Bing and Yahoo. "You do it because it's new, though you don't know how things will work out," he says. "It's a missed opportunity."