Yahoo Gains Marketshare in US and APAC According to Covario's Global Search Spend Analysis : Second Installment in Quarterly Analysis Series Covers Latest Spending Trends in Paid Search Advertising for 128 Brands at 12 of the World's Largest Technology Companies, Including Adobe, Intel, Lenovo and RIM

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Covario, Inc., the leader in interactive marketing analytics, today announced the release of the Q2 2008 edition of its Global Search Spend Analysis series. For the first time in two years, Yahoo has grown the percent of spending it commands with major technology advertisers in North America and Asia Pacific (APAC) at the expense of Google. In addition, Covario is beginning to see the first examples of compression in paid search spending growth. This is evidenced by a dip to 43 percent from 52 percent growth rate in the previous quarterly analysis. This dip is in part due to budgetary pressures resulting from economic conditions, as well as better optimization allowing for similar return results at lower spend levels.

Our client roster inspired us to launch this analysis series due to our customers' unique positions in the advertising ecosystem – they are US-based, but also global in the scope regarding their paid search advertising programs, so they tend not to be retailers or ecommerce vendors who focus on one geographic region

This second installment in Covario's analysis series shows the latest global paid search spending allocation patterns for 128 brands at 12 major technology organizations such as Adobe Intel, Lenovo and RIM between Q1 2007 (Q1 '07) to Q2 2008 (Q2 '08). The combined paid search advertising spend of the analyzed brands represents more than $225 million. Below are some additional highlights from the analysis:

Changes in Regional Spending Allocations by Search Engines

As compared to the 10 percent North America budget allocation reported for Yahoo in Covario's Q1 '08 analysis, the percentage increased to 14 percent in Q2 '08. This increase in spending came directly from allocations that had previously gone to Google, which fell from 86 to 81 percent from Q1 to Q2. While the share of spending allocation in APAC is fairly low, approximately seven percent of budget allocation, it is worth noting that Yahoo's portion increased nearly 35 percent at the expense of Google. Yahoo climbed from approximately 15 percent in Q1 to 50 percent in Q2, while Google plummeted from 72 percent in Q1 to 46 percent in Q2. The remainder of this share gain came from Baidu, which US-based advertisers are finding difficult to use. Q2 allocation to Baidu was only five percent in Q2 from approximately 14 percent in Q1 '08. Europe, Middle East and Africa (EMEA) is a non-competitive market with Google owning just more than 90 percent of global advertisers' paid search spend. This is up more than 10 percent from a year ago and up nearly two percent from Q1 '08. Changes in Regional Spending Allocations

There has been a steady increase in allocations to EMEA-based search spending since Q3 '07. While mid last year the allocation was less than 10 percent due to complications that arose from Yahoo's Panama platform, in Q2 '08 the allocation was up to 27.5 percent. Advertisers are increasing their allocation to EMEA due largely to a more positive economic outlook in the region as compared to the United States. Covario does not necessarily expect a Q3 uptick in spending in APAC due to the Olympics, but there is a possibility of Olympics ads in EMEA and North America driving spending in those regions. Spending in APAC was seven percent, down slightly from nearly 12 percent in Q1 '08. High tech and consumer electronics companies, which dominate Covario's analysis, tend not to allocate a very large advertising spend in the region due to concerns over protection of intellectual property. North America accounts for 65 percent of spending, up by less than one percent from Q1 '08 and up approximately 6.5 percent from Q2 '07. "Our client roster inspired us to launch this analysis series due to our customers' unique positions in the advertising ecosystem – they are US-based, but also global in the scope regarding their paid search advertising programs, so they tend not to be retailers or ecommerce vendors who focus on one geographic region," said Craig Macdonald, vice president of marketing and product management at Covario. "It is very exciting for us to be able to observe first-hand such trends as the bucking of the biggest losing streak in the paid search market – the loss of market share by Yahoo to Google."

This analysis leverages the advanced analytics of Covario™ Paid Search Insight and the paid search advertising data for more than two dozen of the world's largest advertisers including Adobe, Intel, Lenovo and Research In Motion (RIM) to determine global spending trends and performance.

Additional findings and graphical representations of these trends are available in Covario's Global Search Spend Analysis Vol. 2 (Q1 2007 to Q2 2008). The analysis results will also be presented by Macdonald in a webinar format on August 14, at 11:00 a.m. PDT. To register, please use the following link: http://www.covario.com/Q208PaidSearchSpend.shtml.

To request a copy, please contact Covario_Team@jhg.com or visit http://www.covario.com.

About Covario, Inc.

Covario, Inc. is the leader in Interactive Marketing Analytics (IMA) software. The Covario portfolio provides global organizations with robust interactive and search marketing analytics solutions for display advertising, paid search advertising and organic search engine optimization across the enterprise and throughout the channel. Covario enables complex and distributed organizations to control brand integrity, ensure budget transparency and deliver quantifiable results across business units, distribution channels and languages. Headquartered in San Diego, Covario's growing customer list include some of the world's best known brands in high tech manufacturing, financial services, electronics, media and publishing and consumer packaged goods, such as Intel, Hewlett-Packard, Lenovo, iVillage – a division of NBC Universal, and AIG among others. For more information on Covario, call 858.397.1500 or visit http://www.covario.com.

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