Web 2006 – year-end review of developments

In October 2006, the Web reached a milestone number of 100 million domain names (web hosts), according to NetCraft. Supply of free content is increasing at a very high rate, causing an info glut. Everybody is trying to attract the User’s attention, by offering something valuable. Blogging has experienced explosive growth in 2006, and received attention of corporations, since it can influence product reputation and the behavior of interest groups.

Google dominates the search engine market with an increasing share which has been approaching now 50%. Pay per click (PPC) is also dominated by Google with a very large market share and higher per click profit margin that its competitors. The PPC market has been growing worldwide, at a much higher rate to that of conventional advertising media.

Major search engines have been trying to combat click fraud in PPC, which has been posing as the highest threat of search engine marketing. Google declared that click fraud suffered, is now limited to less than 3%. Moreover, major search engines regularly adjust their algorithms to combat web spam and enhance the User experience (improve search effectiveness). Tactics like link farms, cloaking, duplicate content, paid links & reciprocal link exchange, are somehow penalized. On the other hand, web masters increasingly focus on search engine optimization to improve their rankings in the search engine result pages. The search engine optimization market has been maturing in the US, after the initial marketing hype. Keyword analysis has been a very hot topic, supported by commercial tools like Wordtracker.

Acquisitions of e-businesses which have cracked promising niche markets took place (like the video portal ‘YouTube’ acquired by Google). Many experiment on new forms of contextual advertising (PPC, in email (Gmail)) take place. Google has experimented in 2006 with off-line publishing with success, aiming at exploiting the unused space of print media.

Image search is a highly growing market presenting opportunities to those marketers who can exploit it.

Social networks sites (like Myspace.com) have been receiving an increasing attention by web users and present high potential for marketing and advertising in high growth customer segments like the youth.

Local markets and languages presenting a high marketing and e-commerce potential, have been penetrated aggressively by the Big 3 of the search engine industry (Google, Yahoo, MSN), thus reducing the local market share of local sites. On the other hand certain localized portals in major markets have experienced strong growth (like Baidu in China). The speed to fill in the innovation space has been increasing, given the lower cost to start-up new projects or small businesses.