According to research conducted by William Blair and AdGooroo, the growth in total number of search engine marketers exceeds the growth of industry sales. In fact, the total number of advertisers has increased an estimated twenty percent between February and July 2007.

Blair partnered with AdGooroo to examine the search engine marketer trends that drive this twenty billion dollar market.

“We culled data from AdGooroo’s database of keyword advertising to glean insight into industry composition, industry growth, market share, seasonality and company-specific trends,” the report says. “In total, we believe the global marketplace comprises more than five-hundred thousand advertisers and that about ninety percent advertise with Google.”

Additionally, the study found that Project Panama, which serves fewer, more relevant ads with each search, is affecting Yahoo’s advertiser base. The system is helping Yahoo to attract a surge of new advertisers after the launch. However, the study found thatYahoo faced fallout due to the relevancy-based ranking, which hurt some advertisers and its efforts to clean up the advertiser base.

The study concluded that Google is still seeing stable growth.

“While seasonality is a factor, we believe that Google continues to enjoy steady growth in its total number of advertisers and dominates the industry with about three times more advertisers than Yahoo and nearly 10 times more than MSN,” the report says.

Google’s AdWords system is serving up a stable number of paid listings per search. AdGooroo forecasts continued steady and consistent improvement in revenue per search and feels Google is the “best pick” in the sector.

The study also found that competitiveness for paid search is on the rise. Advertisers appear to be very seasonal with bidding strategies. The report highlights the fact that about one-half of Yahoo and MSN’s advertisers are also advertisers with Google, and that these networks attract approximately thirty percent and ten percent of the total universe of search marketers each month.

“[What is] more important to consider is the pace at which the advertiser count is growing,” the study says. “We view this information as valuable, since it provides some insight into the growth and vitality of the medium, as well as the potential competitiveness of keyword marketing.