JupiterResearch has reported this week that Search Engine Marketing (SEM) agencies now direct the majority of SEM spending in the United States. Just a few years ago, most SEM spending went directly to the search engines. According to Jupiter, SEM is becoming a more mature market like traditional advertising in which agencies play a substantial role. As companies continue to hone their online ad dollars with the intention of gaining a better ROI, they’re also hiring SEM firms to further impact the success of their online campaign strategy.

"As search marketing grows in complexity and advertisers increase their search budgets, we expect the market for SEM agencies will continue to expand," said JupiterResearch Associate Analyst Nate Elliott. "With so many agencies offering search engine marketing services, it can be hard for advertisers to choose the right firm. The SEM agencies that have built their own bid management and campaign tracking tools, and that use extensive data to create campaign strategy, are typically able to generate better results for their advertisers.”

The findings show that while just 31% of search marketers use an agency to manage their SEM campaigns, those marketers account for 51% of the total spending on paid search, according to the JupiterResearch survey of search marketers. This marks a significant increase in the spending directed by agencies over the past 18 months.