Digital marketing gets off to a healthy Q1, says Efficient Frontier 

Tuesday, April 19 2011 by Andy Carter

Search engine optimisation providers saw a strong start to the digital marketing year in the first quarter of 2011, according to the latest research from Efficient Frontier.

Efficient Frontier's Q1 2011 Digital Marketing Performance Report showed that search engine marketing grew by 17 per cent year-on-year in the US, largely as a result of solid growth in the retail and finance sectors.

Meanwhile, Facebook advertising is becoming more competitive with cost per clicks increasing by 40 per cent quarter-on-quarter, as the social networking platform continues to develop its advertising offerings.

Similarly, display advertising saw a boost in interest, as evidenced by a 300 per cent increase in exchange ad inventory and a 30 per cent cost per thousand decline, which the company noted points to greater gains in reach and efficiency within the ad exchanges.

Google still has the largest overall market share in search engine marketing spend and clicks in the wake of the Bing-Yahoo! integration, but interestingly Bing's return on investment is currently higher than Google's.

This is because while revenue per click is 12 per cent lower on Bing than Google, costs per click are also lower, driving better results for Bing.

"The strong showing for digital marketing in the first quarter of 2011 was in line with our prediction of a 15 per cent to 20 per cent increase in spend in 2011," said David Karnstedt, president and chief executive officer of Efficient Frontier, which manages over $1 billion (£0.6 billion) in marketing spend annually on behalf of advertisers around the world.

He added: "We're also seeing great demand for Facebook's ad products as the social networking giant's ad offerings continue to evolve. This is all solid evidence of an economic recovery, and that marketers are seeing tremendous results when they intelligently allocate their marketing spend and optimise across channels."

In February, Efficient Frontier was enlisted by Sky to provide paid search marketing services across its UK divisions.

Living Streams "Improving clients' profitability through better use of the internet".