The average keyword price last month was $1.45--a drop of about 6 percent from October 2004, according to the latest monthly keyword price index from search engine marketing agency Fathom Online.
The year-to-year price drop occurred as search engine revenues surged this last year. Google, for instance, recently reported third-quarter revenues of $1.578 billion, marking a 96 percent
increase from the third quarter of last year. The Interactive Advertising Bureau also recently estimated that search advertising revenues increased by 27 percent in the first half of this year.
Fathom Online Keyword Price Index: Year-over-Year
| 10/04 |
10/05 | advertisement advertisement % Change |
Automotive | $1.39 | $1.30 | -6 |
Consumer Retail | .48 | .45 | -6 |
Consumer Services
| .96 |
.86 | -10 |
Travel /Hospitality | .85 | .97 | +14 |
Investment | 1.60
| 1.66 | +4 |
Mortgage | 4.31 | 3.68 | -15 |
Broadband
| 1.78 |
1.63 | -8 |
Wireless | 1.06 | 1.06 | 0 |
Average | 1.55 | 1.45 |
-6 |
Source: Fathom Online
The modest decline in year-to-year keyword prices indicates that soaring search revenues are
due to increased inventory and increased marketer participation in paid search. "There's much more available than there was in the past," said Fathom Online's Gregg Stewart, senior vice president,
channel management and marketing.
Year-to-year, the categories posting the largest declines were mortgages, which fell 15 percent to $3.68; consumer services, which fell 10 percent to 86
cents; and broadband, which fell 8 percent to $1.63.
The only categories to see an increase from October of 2004 were travel/hospitality, which rose 14 percent to 97 cents a keyword, and
investment, which rose 4 percent to $1.66.
On a monthly basis, keyword prices overall rose 1 cent from September, when they averaged $1.44 across the eight categories tracked by Fathom
Online. The nearly flat month-to-month pricing stood in sharp contrast to last year, when keyword prices rose 14 percent between September and October.
"We're not seeing the fast ramp-up
we did last year," said Fathom Online's Gregg Stewart, senior vice president, channel management and marketing. "We're starting to see some of the seasonalities coming out of the numbers," he added.
Fathom Online Keyword Price Index: Month-over-Month
| 09/05 | 10/05
| % Change |
Automotive | $1.51 | $1.30 | -14 |
Consumer Retail | .46 | .45 | -2 |
Consumer Services
| .96 |
.86 | -10 |
Travel /Hospitality | .91 | .97 | +7 |
Investment | 1.46
| 1.66 | +14 |
Mortgage | 3.39 | 3.68 | +9 |
Broadband
| 1.62 |
1.63 | 0 |
Wireless | 1.22 | 1.06 | -13 |
Average | 1.44 | 1.45 | 0
|
Source: Fathom Online
Fathom tracks keyword prices daily. The keyword list consists of 500 generic keywords across eight
categories for the top five ranked positions on selected search engines. The aggregate data contains no proper or brand names. Fathom states that the pricing fluctuations should be viewed in the
context of the eight categories reported, and not as a proxy for the entire search industry.