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Study: Google users wealthier; net savvier

Search engine of choice?

US residents who prefer Google's search engine tend to be richer and have more internet experience than those who primarily use competing search services from Microsoft, Yahoo and AOL, a new study has found.

The longer people have been using the internet, the more likely Google will be their search engine of choice, according to a survey of 1,000 US internet users conducted by investment banking and research firm SG Cowen.

Moreover, people whose primary search engine is Google are more likely to have household incomes above $60,000 (£34,600) than people who use competing search engines, according to the survey which was published this week.

Google also emerged as the search engine of choice, with 52 percent of respondents choosing it as their primary engine for general web searches. Yahoo came in second with 22 percent, while Microsoft's MSN and AOL tied for third place with nine percent. Ask Jeeves rounded out the top five with five percent. (Google powers AOL's general web searches.)

Assuming US Google users really are wealthier, savvier online and Google is the search engine of choice for more than half of them, these survey results reinforce the notion among many businesses that it is critical for them to appear in Google search results or Google search ads or both, more so than in competing search engines.

SG Cowen also projects that paid search - the type of online advertising driving most of Google's revenue - will progressively tower over all other forms of online advertising in the coming years. The firm estimates US advertisers will spend $6.1 billion (£3.5 billion) in paid search this year. A further $6.4bn (£3.7bn) will be spent on all other forms of online ads, such as branded/display ads and classified listings.

But starting next year, paid search will account for over half of all ad spending and increase its lead every year. In 2010, companies will spend $17.3bn (£10bn) in paid search and $12.4bn (£7.2bn) in the other online ad categories, according to S.G. Cowen. The firm predicts a CAGR (compound annual growth rate) for paid search spending of 23 percent between 2005 and 2010, and a CAGR of 14 percent for the other online ad formats.

In another report issued on Monday, investment banking and research firm Piper Jaffray predicted that global online advertising will exceed $55bn (£32bn) in 2010 - a 27 percent CAGR from 2005 levels. The report warns that this "will likely prove to be a conservative scenario."


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