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Advertisers to up CPA and CPL by over 60 per cent

Econsultancy has released its B2B Vertical Search Report for 2009, produced in association with Convera, which finds that advertisers will be increasing spend on performance-based ads in 2009, such as CPA and CPL.

The research found that more than three quarters (78%) of advertisers are planning to increase their spending on CPA (cost-per-action/acquisition) formats this year.

As well as CPA advertising, cost-per-lead (CPL) advertising, which is also performance-based, will also be a major area of focus with two third of advertisers (67%) expecting increased spending in this area.

Similarly, just under half of advertisers will increase their spending on cost-per-click (CPC) whereas only 29% say their spending on CPM (cost-per-mille / online display advertising) will increase this year.

Other key research findings

  • Two thirds of respondents (67%) said that the need to find information quickly is the main advantage of vertical search engines from the perspective of business users.
  • Digital marketing professionals are more likely than a year ago to be using widgets (either desktop or in-browser) that provide customised internet marketing and business information (now 47% of respondents compared to 35% a year ago).
  • Software-as-a-Service (SaaS) is being widely used by companies both for on-site search and for a range of other functions.
  • More than half of survey respondents report that their businesses are using SaaS for email (77%), web hosting (74%), sales and marketing (62%), CMS (59%), file and assets storage (57%), site search (57%) and ad serving (51%).

Overall, 91% of publishers surveyed make use of search log analytics, but only 28% refer to this data frequently. Only a third of publishers (36%) say they derive strategic value from this data.

The study, which follows on from a similar piece of research published a year ago, examines how digital marketing professionals are finding work-related information online, looking at the use of both popular search engines and industry-specific websites. It also looks specifically at the issues facing publishers and advertisers.

Web-hosted, off-the-shelf services (SaaS) on the rise

According to the research, the growth of software-as-a-service (SaaS) can be attributed to the convenience of having an IT infrastructure maintained by the provider which is cited as a major benefit by 75% of respondents, making it the most significant factor in choosing SaaS.

The key characteristics of SaaS are that the software is on-demand and hosted, becoming a variable cost rather than involving capital expenditure.

Examples of such web-hosted services include Google Docs, or Sales Force.

Gregoriadis added: The concept of software-as-a-service continues to be immensely popular for a range of business functions because of the convenience, the lower cost of ownership and generally reduced costs.

The research is based on a survey of more than 500 media and internet marketing professionals, including 152 publishers and 118 advertisers. The survey was carried out online at the end of 2008.

Read Econsultancy CEO Ashley Friedlein's post - New metrics and business models for digital publishing - selling outcomes not inputs?

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