Breaking news- Google is a good place to spend ad dollars!

In my last post, I mentioned the strength of search marketing (from 2006 to 2007, the agency’s search spending rose from 28% to 31% of total billings). It’s no surprise that Google’s efficiency and continued growth played a significant part of this. They continue to execute very well, both as a search business, and for marketers.

It should be noted that the growth in search spend can also be attributed to the strides made by Yahoo!’s Panama and Microsoft’s AdCenter. Each system’s capabilities provide improved flexibility for testing, ad targeting, and campaign management. Search managers are better able to optimize their campaigns and extract more efficiency out of the channel, which led to a larger share of budget in 2007.

While Microsoft Live continues to lag behind in query share, AdCenter is a strong platform that performs very well for advertisers. Cost-per-click (CPC) data drawn from Avenue A | Razorfish’s client base shows that Microsoft is doing an excellent job of monetizing queries, trailing only Google in average CPC.