44 per cent more was spent on search marketing during the first half of 2007 than during the first six months of 2006 said the research and analysis house. Search marketing accounted for 57.1 per cent of the overall UK online advertising spend with £762.3 million invested in the first half of 2007. From the total online spend of £1.3 billion during that period, display advertising accounted for 21.5 per cent and classified advertising took a 20.8 per cent share.

A survey by search engine specialists E-consultancy and Neutralize showed that the main objectives for search marketing were lead generation, direct online sales and driving traffic.

According to search engine marketers, bigmouthmedia, the ability of search to be easily measurable is one of the main reasons why the gap between spend on display and search marketing will continue to grow.

"Search marketing is incredibly accountable, scalable and more predictable than display advertising. The new breed of digital agencies understand search and the very best can coordinate search and display together - the gap between search and display is growing because the new, search savvy, breed of marketer and agency are now controlling budgets," said Andrew Girdwood, head of search, bigmouthmedia.

In an interview with New Media Knowledge, Karin von Abrams, senior analyst, and author of the eMarketer report, UK Online Advertising, believes that display advertising still has a future though brands will have to be more creative to catch the attention of its audiences.

"[Display advertising] has been around almost forever, in Internet time. The majority of Internet users in Britain have been online for several years, so there is nothing novel about display. The proliferation of larger, more "compelling" formats, such as skyscrapers, slowed the decline in attention to display ads, but has not really revived this kind of advertising, said von Abrahms.

"There will always be a future for display advertising, because graphical elements are inherently more attractive and interesting to Web users than text. True, many Net users are relatively indifferent to display advertising, but response levels are not so low that advertisers are abandoning display formats altogether. There is still potential to make display work hard for advertisers, if there is real creativity in design and execution, and display ads are linked to strong brand messages and serve as part of integrated campaigns," she continued.

Despite the number of social networking sites looking to add another dimension to the already competitive online advertising market, von Abrahms warns that the likes of Facebook will struggle to take revenue from search marketing.

"For all the audience numbers and the high engagement of users at leading social networking sites, the monetisation of these audiences is still some distance away.  Facebook’s recent difficulty with Beacon shows how difficult it can be to turn users into champions of products and services. Even if they succeed, some months from now, there will be tens of millions of UK Web users who search via Google and other engines or directories just as they do today, rather than from within a favoured social network. So we can imagine perhaps 10% or 15% of search migrating to the social networking environment in the next year or so, but it will be harder for advertisers and marketers to use that to their advantage than it will be for them to carry on with the tactics they already know, which focus on traditional search engines, affiliate relationships, and so on," she said.

Girdwood, however, believes that the advent of social networking sites should not be seen as a threat to search specialists, more an opportunity to increase the online presence of brands.

"It is already possible to run very good paid search campaigns in Facebook. When Facebook, MySpace and other significant user generated content sites get their advertising models right it will be possible to use them effectively to influence search trends and display advertising will remain perfectly viable for many products, services and brands," he said.