Mobile and tablet ad spend surges

By Chris Lee

The role of mobile phones and tablets in UK paid search advertising has continued to increase and now accounts for roughly 25 per cent of total spend and 28 per cent of total clicks. These are two major findings from demand side platform software firm Kenshoo’s Search Advertising Trends Q1 2013 report.

Meanwhile, US research from The Search Agency has indicated that search spend has risen by more than a fifth (22 per cent) in a year, and that Bing has continued to nibble away at Google’s ad spend market share, with especially strong growth on tablet ad spend. Indeed, click volumes on smartphones increased 86 per cent year-on-year and, despite a drop of more than 10 per cent on smartphone cost-per-click (CPC), total advertiser spend on smartphones rose 68 per cent.

The average CPC in the US and UK dipped slightly in Q1 and the UK remained higher than the US at $0.44 and $0.38 USD respectively. CPC for continental Europe has been relatively flat for the last five quarters and stood at $0.36 in Q1, Kenshoo reported.

Keeping tabs on tablets

Total spend on tablets went up 135 per cent year-on-year, according to The Search Agency and Kenshoo found that the CPC of tablet ads is now the same as on computers.

Keith Wilson, vice president of agency products at The Search Agency, said: “The study also showed tablets continue to be a driving force – consumers are hitting the tablets to shop and buy, with tablet performance steadily increasing over the past five quarters. I don’t see this slowing anytime soon.”

Meanwhile, Kenshoo’s chief marketing officer, Aaron Goldman, said that when it comes to smartphones, advertisers should be assessing the value of mobile clicks in alternative ways because they cannot expect a phone to deliver the same rate of direct online sales as devices with bigger screens that are typically used in the home.

“It’s imperative to track and optimise conversion events like phone calls, app downloads, check-ins, website registrations, store locators. These are KPIs (key performance indicators we should be using to measure the effectiveness of phone clicks,” he said.

Product Listing Ads (PLAs) gain momentum on mobiles and tablets

The Search Agency found that clicks on PLAs increased “enormously” and PLA clicks coming from smartphones and tablets increased 100 per cent year-on-year and 59.7 per cent quarter on quarter. For the first time, likely due to improvements to format and visibility on newer models, smartphones made up more than two per cent of PLA clicks, the company said.

“Product Listing Ads is perhaps the starkest trend,” The Search Agency’s Alex Campbell told NMK. “Google have been pushing this newer revenue stream hard and the switch to a paid model for Google Shopping, occurring since February and planned for completion by the end of June, will grow this market much further. The Search Agency’s experience managing Google Merchant Centre accounts and Product Listing Ads suggests that Google Shopping will represent a very significant traffic source for e-commerce businesses over the coming quarters, as well as a very significant revenue stream for Google.”

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