Over the past year Google, Yahoo, and MSN/Live have launched versions of blended search. The iProspect study revealed that search engine users click on news, image, and video results in blended search results more than they click on results in a vertical only search such as Google News or Google Image search.

Key statistics from the study:

• 36% of search engines user click “news” results within blended search results, while only 17% click a “news” result after conducting a news-specific search
• 31% of search engine users click “image” results within blended search results, while 26% click an “image” result after conducting an image-specific search
• 17% of search engine users click “video” results within blended search results, while only 10% click a “video” result after conducting a video-specific search
• While images are the most clicked type of result after a vertical-specific search, news items are the most clicked type of result within blended search results

Some interesting highlights from the press release:

Interactive advertising revenues will increase significantly from US$45 billion in 2007 to US$147 billion globally in 2012, representing a 23.4 percent compound annual growth rate (CAGR).

“We see Internet development—including increased subscriber/user access and broadband penetration—as a driver of both interactive advertising revenue as well as migration of traditional ad spending to new media platforms.” -Matt Booth, senior vice president, Interactive Local Media, The Kelsey Group.

Interactive advertising, which comprises search (including local search), display advertising, classifieds and other interactive ad products, grew its share of global advertising revenues from 6.1 percent in 2006 to 7.4 percent in 2007. By 2012 Kelsey Group analysts expect the interactive share of global ad spending will reach 21 percent.

Directional advertising, which comprises local search, print Yellow Pages and Internet Yellow Pages (IYP), will grow from US$33.3 billion in 2007 to US$41.4 billion globally in 2012 (4.5 percent CAGR).

• Local search revenues will grow from US$2.1 billion to US$6.6 billion (25.5 percent CAGR).
• Print Yellow Pages revenues will decline from US$27.5 billion to US$25.6 billion (-1.4 percent CAGR).
• IYP revenues will grow from US$3.7 billion to US$9.2 billion (20.1 percent CAGR).

What does this mean to a small business’s online marketing budget? My bet (and I’m really going out on a limb here) is that costs are going to increase as more small businesses begin advertising online. Cost-per-click (CPC) bids are going to increase for the majority of keyword phrases and advertising rates for local search directories and Internet Yellow Pages (IYPs) will increase.

Small businesses that follow best practices for search engine optimization and provide the informational content that online consumers want will reduce their dependence on online advertising for leads and customers.

Some highlights from the article:

Digital, said Bryan Wiener, CEO of digital agency 360i, is the least vulnerable media spend in times of economic downturn because it is inherently more measurable than other media. [Wiener] add[ed] that the categories that tend to drive the best return on investment are e-mail and search — so marketers are likely to continue investing in those categories regardless of the economy.

Search marketing, because it’s so closely tied to sales, more often is thought of as a cost of goods sold rather than a marketing and administration expense. Therefore, it is assumed to be the most recession-proof of all marketing channels.

“As consumers get more frugal, [Consumer Package-Goods] will shift their media to things that have a more immediate return on investment,” Mr. Garga said. “Shopper marketing is a captive audience in the store with an immediate effect. … Online is a medium, too, that supports more value-oriented messages.”

I highly recommend reading the article. It offers some great insights.

Some interesting snippets from the Agile Equity release:

• The buyer is actively integrating with the existing management team to sustain and accelerate a supernormal growth rate.
• This is PromiseONE’s first acquisition in the digital media sector.
• AdAge magazine named Fathom SEO among the top 20 search engine marketing agencies in 2007.

Is this the start of a merger and acquisition phase in the search marketing industry?