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SEO Industry Market Size


What is the overall market size of SEO? What is the expected growth of digital marketing this year and beyond?

This high-level SEO industry growth report will give you a sense of the overall size, scope and expected growth of the digital marketing industry.


Disclaimer & Executive Summary

Please consider the following key points relative to this market report.

  • This report on the SEO & digital marketing industry provides detailed expert market size and market growth estimates for digital marketing consultants, search engine optimization (SEO) agencies, SEM firms and other companies who provide expert consulting for internet advertising. The report includes detailed discussion of the United States as well as global statistics.
  • This market report is not comprehensive, but represents a collation of various market reports and research reports performed by reputable third parties. The research included herein should not be wholly relied upon to make complete, accurate or timely business decisions, including investment decisions.
  • Related, ancillary services and firms provide various overlapping services, including--but not limited to--website design, public relations, management consulting, advertising & market research/analysis and IT consulting.
  • We encourage those interested in further detail based on the findings presented to further consult the original research sources referenced herein.
 

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SEO Industry Key Statistics

High-level industry size and growth statistics for the digital marketing and search engine optimization (SEO) industries.


42.2

Industry Revenue


Total industry revenue (in billions USD) 2020
3.5%

Annual Growth


Expected annual growth (2020-2025)



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15%

Organic Traffic


Expected CAGR from 2020-2024

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79.3

Industry Revenue


Expected market size 2020 (in billions USD)

As one might expect, significant variation exists between assumptions on market size and growth. However, some reports take a look at industry specifics like SEO and digital marketing SaaS, including MarTech, while others focus specifically on direct SEO & digital marketing services. Despite the variation, key indicators, including the SWOT and industry analysis below reveal additional details on whether or not it makes sense to enter the SEO business.

SEO Industry Performance

Historical performance for SEO & digital marketing industry.

SEO Industry Lifecycle

Demand lifecycle for digital marketing and SEO relative to market maturation.

SWOT Analysis

The following provides a Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis of the SEO market.

Strengths
Low Imports
Growth Live Cycle Stage
Low Customer Concentration
Low Capital Input Required
Weaknesses
Low Barriers to Entry
Highly Competitive "Red Ocean" Industry
Low Profit vs. Sector Average
High Product/Service Concentration (i.e. Google)
Opportunities
High Revenue Growth
High Performance Drivers
Large Overall Ad Expenditure
Sizable Market
Threats
Low Outlier Growth
Internet Traffic Volume
High Supplier Concentration (i.e. Google)

SEO Industry Products & Services

Products and services provided by agencies, service providers, SaaS/MarTech companies in SEO & digital marketing. Source: Borrell.

Spending By Category

    • This is the 1st bar50%
    • This is the 2nd bar30%
    • Web Presence53%
    • Online Ad Production17%
    • Online Marketing Support12%
    • Online Public Relations9%
    • Consulting & Research9%
 

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Major Market Segments in SEO

Major markets that typically engage SEO and digital marketing service providers. Source: IBIS World.

Major Market Segmentation by Sector

    • This is the 1st bar50%
    • This is the 2nd bar30%
    • Retail Trade & Consumer Goods30%
    • Travel, Entertainment & Media21%
    • Internet & Telecom18%
    • Other Businesses21%
    • Financial Services21%
    • Healthcare & Pharmaceuticals21%

Major Competitors

As a highly-fragmented industry, industry researchers do not believe that any single SEO agency or digital marketing company represents more than 1% of the overall industry pie.

Conclusion

Strong opportunities remain in the SEO & digital marketing industry.


Continuous innovation makes the advertising industry a dynamic sector. Prior to recent memory, advertising was primarily concentrated in print and broadcast media. Significant shifts to internet marketing continue to occur, especially as more brands push toward direct-to-consumer (DTC) advertising options through online search, social media and other digital channels. Furthermore, the proliferation of mobile phones, tablet and desktop computers is expected to continue to see the rise in the digital marketing industry. These shifts are also creating shifts in consumer media consumption behavior. As a result, advertisers are expected to follow consumer demand of digital media.

In fact, according to the Internet Advertising Bureau (IAB) internet advertising revenues increased nearly 54% from the years 2013 to 2018. Increased demand for industry services is expected to expand the industry further in 2020, created anticipated earnings before interest, taxes, depreciation and amortization (EBITDA) of nearly 7% of overall industry revenues. Even in spite of pandemic pressures, the industry is expected to continue to grow over the coming four years (through 2025), albeit less rapidly than in years past.

What are the industry's major profit stats & drivers?
Industry EBITDA accounted for roughly 6.7% of revenue in 2020. This represents a slight decrease from 2015 when EBITDA margins were 8% of revenue. Profit remains higher among larger industry players.
What are expected industry COGS?
COGS (cost of goods sold) in the SEO and digital marketing industry are low, representing only about 1.4% of revenues. Most of these expenses are related to software and office-related products.
What are industry depreciation expenses?
Industry depreciation expenses relative to revenue were <1% in 2020.
What are typical wages in the SEO industry?
Wages in digital marketing accounted for some 38.8% of revenue in 2020, up from 37.6% in 2015. The industry remains reliant on heavy labor inputs, particularly on the consulting side.

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