Search leads Australian online ad market growth

The Australian online search ad market grew 23% in FY13, outperforming all other major online advertising segments, Frost & Sullivan estimates.

The research firm expects the segment to continue its strong growth in the near future, expanding at an estimated CAGR of 16% between 2013 and 2018.

Search’s total proportion of the online directories market is meanwhile expected to expand from 83% this year to 91% in 2018.

Helping to fuel the growth is the influx of smartphones and tablets in the Australian market and their impact on browsing habits, Phil Harpur, Frost & Sullivan senior research manager for ANZ, said.

“The volume of local searches conducted via the mobile web is growing at a much faster rate than via fixed internet connections. Search results from mobile searches are becoming more distinct to fixed internet searches, with a high proportion of mobile searches optimised for location-based material. Also, click-to-call features are becoming more prominent in mobile search advertising.”

The proportion of search advertising spending targeted at mobile devices is also expanding, with advertisers attracted to the relatively high click-through rates and low cost per click on mobile devices.

Google still dominates the Australian search ad market, but competitors are making inroads, Harpur said. “Sensis’s search advertising offering, Sensis ClickManager, displayed strong revenue growth in FY2013. Adlux has also established itself as a viable alternative to Google with continued strong growth from a small base.”

Image courtesy of Duncan Hall under CC.