• by Laurie Sullivan , Staff Writer @lauriesullivan, January 4, 2012

Search marketers have a lot to think about these days. Optimize campaigns, integrate social signals, and try to figure out the perfect time to begin allocating budgets to mobile search campaigns. And what about tapping search data to target and retarget display ads?

Spending on paid search rose 7% in Q4 2011 sequentially and 28% year-on-year among Covario's clients, who invest about $400 million annually on paid-search campaigns in more than 45 countries. The findings are part of the Covario Global Search Spending Analysis, which analyzes trends mostly among high-tech and the consumer electronics companies, but company executives assert that the numbers fall in line with industry norms.

Covario estimates that Google took 76% market share; Bing and Yahoo, 13%; and Baidu, 9% for the quarter. Advertisers spent 8% more, sequentially, on paid-search campaigns across Google in Q4 2011, and 27% compared with the year-ago quarter. Spending on the combined Bing and Yahoo network fell 1% and 18%, respectively. Investments in campaigns running on Baidu grew 19% and 185%, respectively, in the Asia-Pacific region.

North America experienced strong spending growth in Q4 2011, up 11% sequentially, and 18% year-on-year. While spending in Canada and the United States rose, advertisers in Europe, Middle East and Asia (EMEA) fell 8%, sequentially, but rose 9% year-on-year. Overall, budget growth in EMEA for the year grew 22%, which was slightly below Covario's 2011 forecast.

Asia-Pacific (APAC) continues as the region demonstrating the most growth and opportunities for the high-tech industry, which includes companies like Lenovo. Sequential growth rose 8%; with year-on-year growth up more than 100%. 

Spending-level recommendations coming from a search platform provider may seem a little odd -- okay, fishy -- but it's important to weigh the results with the recommondations before jumping down someone's throat. Similar to spending-level recommendations in 2011, Covario analysts suggest that advertisers raise their budget between 18% and 20% in paid-search spending in the Americas. Budgets should allocate between 75% and 80% to Google, accounting for the need to overcome regular traffic shifts to paid search from Google Instant. The other 20% to 25% should go to Yahoo and Bing. Secondary search engines will account for less than 3% of spend overall in the region.

For large high-tech advertisers, Covario recommends budget increases between 15% and 18% in EMEA. About 95% should go to Google, except in Eastern Europe, where spending on Yandex will dominate budgets.

Making the most of budgets, advertisers should consider spending between 40% and 45% in the APAC market. Chinese market investments favor Baidu with 60% of the budget. Japan’s budget should take a 60/40 split: Baidu should get 35%; Google, 40%; and Yahoo, 25%.

When it comes to allocating budgets per region, the Americas took 11% more in Q4 2011 sequentially, and 18% compared with the year-ago quarter.

Google took roughly 76% of the budget for Covario advertisers in the Americas last year. The Yahoo-Bing alliance market share took 23%. Covario analysts expect no impact from secondary search engine platforms on the overall dynamics of paid search, other than local search, in 2012.