MSN is "gaining on" its competitors in the paid search sector, it has been revealed.

An annual industry survey from Search Engine Marketing Professional Organisation (Sempo) shows that MSN is now used by 68 per cent of marketing managers.

This compares with a figure of 29 per cent in 2005 and places MSN in third place behind Yahoo and Google in terms of manager support.

Yahoo ranked second in the survey with 86 per cent of respondents stating that they use the search engine in promotional campaigns.

Meanwhile, Google was used almost unanimously, with 96 per cent of those surveyed citing it as featuring in online marketing efforts.

Overall, paid placement was seen to be the second most favoured method of search engine marketing (SEM), behind organic search engine optimisation.

In monetary terms, 86 per cent of all SEM spending is now on paid placement, Sempo claims, with three-quarters of advertisers saying they could increase their budget still further.

Research from industry analyst E-consultancy suggests that marketing managers are becoming increasingly aware of the return they can expect on investment into paid search campaigns.