SUNNYVALE, California: Online search adspend fell by 8% year-on-year in the US in Q4 2008 according to Efficient Frontier, a search engine marketing firm, as the automotive, financial and retail sectors made substantial cutbacks. Some analysts, however, cast doubt on these figures based on the growing revenues posted by Google and Yahoo.

According to Efficient Frontier, the financial sector reduced its search adspend by 20% in Q4 last year, while the automotive category's outlay was down by 15%, and retail search expenditure fell by 9%.

Advertisers with a monthly search budget of over $200,000 (€153,323; £134,016) were found to have reduced their spending by an average of 23% year-on-year.

Companies with a monthly search outlay of between $50,000 and $200,000 also cut back by 9%, while the behaviour of marketers spending below $50,000 a month on search was largely unchanged.

However, David Hallerman, senior analyst at online research firm eMarketer, says the revenue figures posted by search giants Google and Yahoo suggest the search downturn may be sector specific.

Said Hallerman: "Google's US net search revenues in Q4 were up by 17% year over year … Furthermore, Yahoo reported that its US search revenues in Q4 were up by 18%.

"One must conclude that the Efficient Frontier data, based as it is on its own client base, reflects the particular financial problems of those verticals. Those include financial services, travel and entertainment, retail, and automotive."

Data sourced from eMarketer; additional content by WARC staff