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Q308 Search Advertising Report: Microsoft Bounces Back

Search Engine Advertiser Update – Q308
October 9, 2008

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We start this quarter's report off with the good news: Microsoft has come back in a big way. During Q3, we measured a 19.3% increase in active first page advertisers, the biggest quarterly increase since we began measuring advertising activity in April 2007. In just one year, Live Search has grown their active advertiser base by almost 32%, putting them in the strongest position since their inception. That they've been able to retain advertisers in the face of an uncertain economic environment is a sign of both excellent customer service as well as positive return on investment.
The above is just a small portion of the full report. To continue reading, please complete the download form on the right. This seven-page report also contains the following tables and charts:

1. Average Ads Shown vs. # of Searches
2. Monthly Growth in Advertiser Count
3. Relative Advertiser Count vs. 12 Months Ago
4. Share of Advertisers by Search Engine
4. Avg # Ads/Keyword (US & International)
5. Avg # Ads/Keyword (US only)

Excerpt from "Q308 Search Advertising Report"

However, Google appears to have had a mixed quarter. We recorded a 3% increase in active advertisers, which would've been good news were it not for Sergey Brin's statement that Google has been “too aggressive in reducing coverage this past quarter [Q2] ”. While it appears that the company was taking steps to increase coverage (at least through July), ad coverage dropped to its lowest levels in August and September, suggesting that August and September may have been weak months.

We venture to speculate that May's rollout of the new AutoMatch algorithm has not made up for the attrition of small advertisers. This is further supported by the fact that...
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