Yahoo Continues to Lose Search Market Share in U.K.

Spend on search advertising in the U.K. increased 11 percent in the final three months of 2008 compared to the same period in 2007, according to Efficient Frontier’s Q4 Search Engine Performance Report, released yesterday.

According to the report, Google further extended its dominance of the search medium during the fourth quarter, growing its total market share from 82.6 percent to 88.2 percent. This growth appears to have been attained at Yahoo’s expense, whose share of spend dropped from 13.9 percent to 8.4 percent, representing a 40 percent decline since Q4 2007. Microsoft’s search product remained consistent, with a 3.4 percent share.

The figures include spending through the Google and Yahoo content networks. This is likely to have contributed the majority of Google’s growth in market share, owing to the 300 percent year-on-year increase in spending its Content Network received, according to the report.

Although Google’s content business is often contextual rather than search advertising specifically, Jonathan Beeston, client services director at Efficient Frontier, believes it is important that the research reflects changes in spend as search players look to diversify their offerings. “The challenge moving forward for the search engines is to increase revenues from other media. The core growth for Google over the next few years won’t be in search, it will be across their content network,” he said.

“If you’re talking to a Google representative about search, before long you’ll be talking about content. [The content stats] are included because they show an interesting increase in popularity of the Google content network, and a step in this direction,” Beeston continued.

Content Match, Yahoo’s contextual product which was shut down in Europe earlier this month, garnered a 0.0 percent market share in Q4, in comparison with Google’s Content Network share of 6.4 percent.

Interestingly, Efficient Frontier’s Q4 U.S. numbers, released last week, suggest that search spend in the U.S. market has actually dropped 8 percent year-on-year. Google held on to its 76 percent market share, but Microsoft’s Live Search fell slightly to 4.2 percent, allowing Yahoo to snap up the remaining 20 percent.