Future of SEM is Beyond the Search Engines

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September 19, 2012

A recent Forrester report found 30% of online shopping trips start with Amazon—compared to only 19% with Google. Amazon’s long march to be “the Google of Retail” seems to have come to a successful end. Add the fact that Amazon now allows third parties to advertise within its search results, and it starts to feel a lot like a search engine—and that a profound shift in "SEM" will follow.

The phenomenon isn’t limited to Amazon. More and more companies are opening up their on-site search results to third party marketers. It’s already the norm for most online travel agencies. Facebook has extended its ad offerings to encompass its own search results. Twitter is rumored to be following suit. eBay’s renewed investment in its on-site search is also likely to feature 3rd party ads – particularly in the context of its push into offline retail via Milo and PayPal. The list goes on.

For search engine marketers, the growing variety of options adds complexity. These new sources of inventory are in many cases fundamentally different from what’s on offer from Google and Bing. More granular, more urgent, more geo-specific, more visual, more flexible.

But with this added complexity comes valuable scale and scope. The sheer volume of searches occurring within these new sources of inventory dwarfs anything an earlier generation of would-be Davids were able to put up against the Google Goliath. And scale provides a sufficient return on effort. It’s worth marketers’ time to invest in these new channels.

Some of this will be at the expense of the search engines: a retail search on Amazon very likely replaces one otherwise done on Google. But in other cases it will be net new opportunities for marketers, such as when a consumer taps into mobile to find offline options for her needs.

Don’t believe SEM is moving beyond the search engines? Earlier this year, Business Insider reported than Amazon’s ad business is already approaching $1b. The future is already here.