2012 seemed to fly by, yet the world of search engine marketing (SEM) changes even faster. Once again the Anvil team is collectively throwing our hat in the ring and sharing thoughts on where the SEM industry is headed in 2012 and beyond. We’ve also included our 2011 predictions for reflection – overall we’d say our somewhat out of the box predictions were on the right track. Some predictions may not have come to light in 2011, but we feel they are closer to truth than a year ago!

Pay-Per-Click
The biggest change we saw in Pay-per-Click (PPC) this year has been in the targeting department. As technology advances, marketers are given the ability to hyper-target consumers. Whether targeting by location or interest, marketers are closer than ever to being able to reach the exact person they want.

2011 Predictions:
We may have been partially ahead of the game on these predictions, but things are definitely still headed this way.

• You’ll be able to serve ads and offers to users based on where they are physically located.
• Mobile searches will be targeted based on location (if you’re standing by a Target – you’ll see a Target ad).
• Users will be able to point their phones at a store and get served ads/coupons from that store.

Where We Predict Things Are Headed in 2012:

• PPC advertising will become bigger in social media and YouTube, as an increasing number of searches are now taking place outside of search engines.
• PPC advertising will become more interactive and engaging as non-search options increase viability.
• In an attempt to maximize revenue and decrease fraud, Google will update and change the way their PPC advertising works 3 to 4 times throughout the year, allowing advertisers just enough time to master it before having to re-learn it all over again.
• PPC advertising will start appearing in some form on television sets, as more and more start integrating with the internet.
• PPC will also make its way onto console video game units, enabling more free games to be offered (much like free games with ads in tablet and smart phones).

Website Conversions
Conversions are the key to success – if marketers can’t get the consumer to convert, what is the point of all of their efforts? Emphasis has definitely shifted from quantity to quality in 2011 with companies realizing that it all comes down to a sale or a download rather than high traffic numbers.

2011 Predictions:
Videos are definitely big – consumers want more engaging and interactive content and companies will continue to provide all the way to the bank.

• Videos will convert more than ever before.
• Having videos that focus on unique selling points of a product and show a consumer the difference rather than just tell them the difference between your product and a competitor’s will drive conversions.

Where We Predict Things Are Headed in 2012:

• In 2011 more businesses shifted marketing budgets from generating leads to converting the leads they have already generated. This shift will continue into 2012, as markets ramp up conversion tools, including marketing automation platforms.
• More focus will be placed on automation within the conversion optimization process. Generic forms with static entry fields will be a thing of the past, replaced by customized forms based on user profiles, behavior and preferences.

Social Media
Where would we be without Facebook, Twitter or Google+? If they didn’t exist, we might actually have to call our distant cousin to find out what they had for lunch. As the years go by, new social platforms launch (many of which fail) – the challenge is staying apprised of the fluid world of social media. Keeping connected is key to the consumer and it’s up to the big game changers like Facebook and Google to continue to improve the social landscape and offer companies and consumers ways to connect to each other.

2011 Predictions:
We’ll admit it – we missed the ball in a few (Facebook) places. However, we did see an increase in integration between traditional (offline) and online advertising, including featured use of QR codes, Facebook and Twitter profiles.

• Use of Facebook Places will overtake other location-based system (LBS) platforms, which will struggle to maintain marketshare.
• Social media marketing spend will increase as a percentage of media spend, at the expense of traditional media (broadcast and outdoor).

Where We Predict Things Are Headed in 2012:

• Companies will focus increasingly on Social Media Analytics, as the importance of measuring the ROI on social media campaigns continues to increase.
• Social’s integration into search engines continues to increase as social signals and sharing will have an even greater impact on search engine rankings.
• Mobile and local will continue to expand and integrate as personalized social marketing grows.
• Video will continue to gain popularity as a sales and marketing tool, fueled primarily by YouTube consumption.
• Google will purchase Facebook and rename is Facebook+ in order to further take over the online world.

Local SEO
Local search engine optimization (SEO) continues to grow – however there is still a long way to go until companies big and small will be able to have complete control of their local presence. Erroneous contact information and false reviews can takes months to correct and can be difficult to manage, although Google, Bing and others know the issues and are trying to help. We hope, but do not expect, local SEO management will become easier this year.

2011 Predictions:
We believe 2011 was The Year of Local. With an increase in attention on local search by the media, marketers are following.

• Reviews, reviews, reviews! A marketer’s job will be to get (positive) reviews, which are going to be the key driver in rankings, reputation and ultimately sales.
• Local search will become “socialized” with companies interacting with consumers directly through listings/local portals.
• The online reputation management (ORM) industry will continue to grow, fueled by the need to manage “bad” reviews and undesirable customer comments on blogs, forums and articles.

Where We Predict Things Are Headed in 2012:

• Local search will continue to experience significant increase in spend—some verticals will see 25% of their website traffic come from mobile by the end of 2012.
• Check-in services (like Foursquare and Gowall) will begin to consolidate, and Google’s Plus check in service will likely flop.
• NFC will gain popularity as all new smartphones now incorporate the technology, making hyper-local advertising more accessible for smaller businesses. NFC will likely spawn a new form of advertising: a pay-per-in-store-visitor (where customers checking in with NFC receive rewards, but also generate a commission or fee).
• By the end of 2012, people will have forgotten how to read street signs or navigate a city without GPS, making it impossible to open a business without a strong local search presence.
• In a state of confusion resulting from our importance placed on the online world, online royalty (Foursquare Mayors, Yelp Dukes/Duchesses) will begin to be elected to office in real life.

Search Engine Optimization
The goal of search engine optimization is to get in front of the right customer at the right time. As search engines continue to adjust algorithms to weed out bad content, it will be more important than ever to ensure that you are delivering fresh, relevant content to users (in order to stay on top).

2011 Predictions:
Quality of links definitely came to the forefront – especially with Google’s algorithm updates in 2011.

• Page Authority will become more important than PageRank and an increased emphasis will be put on quality links rather than the quantity of links.

Where We Predict Things Are Headed in 2012:

• Google will personalize search results even further for individual users based on their previous activity and searching habits.
• Google will update its algorithm to increase rankings based on a website’s usability/user experience. This is currently happening with site speed and will expand into other areas of usability.
• Google will expand its focus on Semantic data and tagging within a website to better understand and categorize information.
• Yahoo will move into the #1 spot for search engines as Google continues to spread itself too thin and neglect its roots.

The following categories are new for 2012 and beyond:

Website Design
In the past, a company’s website has been a single, monolithic entity in which all content lived. With the rampant adoption of social media, video content and smartphones, an effective online presence is multi-dimensional as well as media and platform agnostic.

Where We Predict Things Are Headed in 2012:

• With Facebook becoming such an integral part of people’s online lives, users will increasingly be able to access a company’s content and products without ever leaving Facebook. This includes developing custom page and tab content, Facebook Apps and social commerce.  A company’s external presence on social media and elsewhere will need to be as well-developed as its internal properties.
• The increasing integration of social signals and content within Websites will mean that, even if a user does make the jump over to a company’s Website, that experience will no longer a fully curated experience. Content will be augmented, and even generated, by social media in the form of Like/Tweet/+1 buttons and Facebook news feeds.
• Mobile-optimized websites have, to date, been positioned as separate incarnations of a corporate website, stripped down and simplified for mobile devices. The latest SEO wisdom (and W3C recommendation) state that a website should have only a single incarnation – one top-level domain and one set of content, with CSS doing the job of making the website readable and usable on any given device or screen size. We predict that development will shift towards a company’s website having different looks, and different content, based on the access device As HTML5 and CSS3 muscle their way into the mainstream, Web designers have 2 powerful new toolboxes to re-imagine the website. Animation will experience a resurgence in popularity, with these Flash alternatives.

Business to Consumer
Where would we be without the consumer? They are the powerhouse that drives the economy and it’s time businesses cater to their needs. Ease is the deciding factor when it comes to a purchase – can the consumer find the info they need? Can they make a purchase in a few clicks? These are just a couple of the questions companies need to answer for consumers in order to win their business.

Where We Predict Things Are Headed in 2012:

• Retailers will see unprecedented growth in the mobile space through native apps. Look to top retailers like Nordstrom, Target and QVC to lead the way and further market their existing apps to encourage impulse purchases. Smart brick-and-mortar retailers will also rely on apps and push notifications to send deals and coupons to customers when they’re in the vicinity of a retail store. Word to the wise: use caution when downloading the Nordstrom and Target apps – they make it WAY too easy to shop.

Mobile
“Mobile” was the marketing buzzword of 2011. We saw a shift towards more businesses taking note of this (relatively) new form of traffic and realizing that they need to reach its audience on these devices. Whether it is an app or a mobile website companies can no longer ignore the power of the phone and tablet.

Where We Predict Things Are Headed in 2012:

• 2012 will be the year to find out if there’s room for a third mobile operating system (see the Microsoft/Nokia partnership) or if Google and Apple are going to continue to dominate the market as smartphone adoption in the US surges past 50% of all mobile users. If we had to put money on one horse, it would be Google’s Android platform, as it is available on a variety of manufacturer devices, vs. iPhone’s proprietary OS.
• As mobile search continues to evolve it’s also going to be increasingly more important to make sure brick-and-mortar businesses are optimized for local search by claiming place pages, including leveraging click-to-call phone numbers, etc.
• Location check-in services will continue to consolidate (see Facebook and Gowalla) as this oversaturated market clearly needs thinning out.
• Hyper-local offers (within a supermarket aisle or when walking by a business on the street) will trickle into the marketplace, but these early incarnations will be rough and will only be available on a small scale. This will be a big area to watch in coming years, however.
• Smartphone “wallets” will try to take off in 2012 but there’s going to be too many companies with competing technology that the field is going to be completely saturated and consumers overwhelmed and confused. 2012 will see the development of the technology, 2013 the thinning of the heard, and 2014 when smartphone wallets will start to gain traction.

Link Development
Links are important – we know this for a fact. Inbound links send signals to search engines to whether or not your site is legit. Having quality links is key – and as new algorithms rolled out this year it became clear that search engines are taking notice of link farms and are looking to weed out the weak and reward the strong.

Where We Predict Things Are Headed in 2012:

• Google will continue to update its algorithm through changes both large and small, which will impact the effectiveness of external links. Paid linking methods will be targeted by Google and penalized.
• Creative content production through infographics, video and audio will begin to play a larger role in link development. Businesses will also be rewarded for ethical online behavior, as it pertains to link development and content creation.
• Social Signals will carry equal weighting to external links, as Google Plus gains steam and integration in to search results. Fresh, updated, interactive content will start to have the same effect as a major link building campaigns. While freshness has increased in influence, it will be refined, once Google realizes they are giving too much visibility to low quality content.

And that’s how the Anvil team sees it – check back in December 2012 to see how we did and read about where we see the world heading in 2013.