Despite steady growth in search engine marketing spending the past two years, it didn’t keep pace with years past. However, the “State of Search Engine Marketing 2010” report, from Econsultancy and the Search Engine Marketing Professional Organization (SEMPO), indicates a rise in spending is set to return in 2010.

According to the report, spending on search engine marketing will be up nearly 14% to $16.6 billion this year. This includes paid search marketing, search engine optimization and other related search technology.

Most marketers stated they would be spending more on both paid and organic search while almost one-half of respondents indicated they planned to shift print budgets into search. Perhaps more telling, more than one-third stated they would be spending less on direct mail and focus more on search marketing.

Search was seen by most marketers as a tool for driving website traffic and lead generation with conversion rate and number or sales or leads as the top three ways to measure its success. Paid search was utilized to sell products directly, as well as generate leads and drive traffic. Conversion rate was the top measure of success for paid search.

But for both forms of search marketing, respondents’ top challenges were measuring return on investment, along with optimizing destination pages and researching and choosing the best keywords.

The report also acknowledged that search engine optimization was a moving target and that staying current with changing algorithms and technologies was just as important as choosing the best keywords for optimization efforts. Marketers were also challenged to integrate both types of marketing with their other offline and online channels.