Paid search spend growth is relatively steady, but slowing from the impressive rates seen over the previous few quarters.
U.S. mobile paid search spend increased astronomically, while organic search visits from mobile, mobile as a percentage of total search spend, and mobile clicks and impressions all rose.
Q2 Paid Search Spend Up But Growth Rate Slows
Paid search spend increased 15.5 percent YoY in Q2 2012, though the growth rate actually slowed, at nearly half that of last quarter, according to IgnitionOne.
Rimm-Kaufman Group (RKG) found a similar trend among their clients, who saw a 29 percent YoY increase, down from the 32 percent Q1 2012 spike in paid search spending.
Covario saw slightly different results for their clients, who deal exclusively in technology, retail, and consumer goods. They reported a 5 percent increase over Q1 spend, 17 percent higher than Q2 2011. Covario research analyst Charles Gaylord, who produces the quarterly analysis, called this “a healthy growth rate, but still down compared to the sizeable amount of spending that has occurred over the last three quarters.”
U.S. paid search click volume rose 19 percent, alongside an 18 percent increase in impressions, according to Marin Software. They also found that cost per click (CPC) increased by 3.4 percent YoY, from $0.89 in Q2 2011 to $0.92 in Q2 2012. In their report, Marin wrote, “The higher cost per click (CPC) can largely be attributed to a few specific industries where higher competition and seasonality played a factor.”
Reports on Paid Search Spend Point to Growth for Bing/Yahoo
Bing/Yahoo costs-per-click grew 32.9 percent in Q2, faster than Google’s 11.4 percent. However, Google saw greater growth in impressions and clicks, according to IgnitionOne. “As this growth is off a smaller base, it did not translate into an increase in market share for Yahoo!/Bing,” they reported.
RKG pointed to 16 percent growth YoY for Bing/Yahoo, up from 10 percent growth in Q1 2012. Click growth was weak at 3 percent, they said, but CPCs increased 12 percent.
Google paid search spending grew 32 percent over Q2 2012, though this was down from 36 percent over the previous quarter. Google click growth was steady from the last quarter at 46 percent, while CPCs rose 4 percent, though this does represent a 10 percent decline over Q2 2011. Paid search spending on Bing/Yahoo rose 16 percent YoY, up from 10 percent growth in Q1. YoY click growth was weak at 3 percent, while CPCs increased 12 percent.
Marin Software reported that, “On Yahoo and Bing, the story was largely about continued investment but higher CPCs.” They noted that on a year over year basis, advertisers saw click volumes increase 14 percent, with a 22 increase in CPC and a 5 percent increase in CTR.
Marin reported seeing a 13 percent YoY increase in clicks for Google, with impression volumes rising 10 percent. Marin also reported their clients saw a 3 percent increase in CTR on Google.
Mobile Growing in Paid and Organic Search, Driven By Tablets
U.S. mobile search spend increased an astonishing 333 percent YoY, representing an increase from 12 to 14 percent of total search budgets, said IgnitionOne. Engagement on mobile ads also spiked 325 percent, while impressions were up 130 percent.
RKG found a similar trend, putting mobile as a percentage of total search spend at 13 percent. Tablets, with a 9 percent lower CPC compared to desktop, accounted for 57 percent of all mobile clicks. They also found that mobile accounted for 15 percent of organic search visits, up 2 points from 13 percent last quarter.
“Increased adoption and higher ad engagement on smart phones and tablets is resulting in a greater share of paid search clicks coming from mobile devices,” Marin Software reported. Their data showed that the share of clicks from mobile in the U.S. rose from 14 to 18 percent QoQ. The share of paid search spend on iPad and other tablets, meanwhile, rose 40 percent.
For full reports and information on each contributor’s methodology, see:
- RKG: Digital Marketing Report Q2 2012
- Covario: Global Paid Search Spend Analysis Q2 2012
- IgnitionOne: Travel and Mobile Are Q2 Bright Spots as Search Spending Growth Slows
- Marin Software: Paid Search Advertisers Jump Onboard iPad and Tablet Devices
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