If you're investing in search advertising, the time is now to understand your mobile audience. In its latest research, online advertising platform Marin Software forecasts that mobile devices will comprise 50 percent of all paid search clicks by December 2015 at the current rate of growth.
Marin sampled its "Global Advertising Index" composed of advertisers across the globe who invested more than $6 billion in annualized spend to reveal other key findings like:
- Cost per click (CPC) on mobile devices increased at a much higher rate than CPC on the desktop during 2013. In some regions, tablet CPCs surpassed desktop CPCs. (Recently, we covered eMarketer's forecast that desktop ad spend will plummet by more than a billion in 2014.)
- Conversion rates on tablets and smartphones rose throughout 2013 as "consumers became increasingly comfortable with mobile commerce," said Marin. "In the U.S., conversion rates on tablets edged out those on the desktop, marking an important milestone."
In 2013, the average click-through rate (CTR) on a smartphone was 3.75 percent versus 2.29 percent on desktop and 2.70 percent on tablets.
Marin speculated this could be due to the limited screen size of smartphones, which reduces the number of ad impressions delivered per search.
"Additionally, the increased urgency associated with being mobile and on-the-go can change consumer behavior and lead to greater engagement with the SERP," Marin reported.
But when the data was normalized for the position of the ad in the results, there wasn't much of a difference.
"Across devices, click-through rates are similar for ad positions one through five," Marin said. "Smartphone searches only deliver up to five ads, and not coincidentally, smartphone ad click-through rate disappears altogether after position five."
From 2012 to 2013, Marin said there was a 20.8-percent increase in CPC on smartphones, with tablets showing a boost of 22.6 percent.
"However, conversion rates tell a different story," the report stated:
In 2013, tablet conversion rates managed to edge out desktop conversion rates for the first time (5.5 percent vs 5.3 percent respectively). This is an important milestone for tablets, and underscores their role as emerging online shopping devices. Smartphone conversion rate still lags at 4.4 percent. However, when we compare conversion rates between 2012 and 2013, smartphones and tablets have increased conversion rates by 57.1 percent and 66.7 percent, versus 35.9 percent for the desktop.
In its report, Marin gave best practices for applying the data:
- Ad position: Ad position is critical for advertising in general, said Marin. "However, it is especially important for smartphone advertising due to the constraints of the small screen. Positions 1 and 2 are by far the most valuable positions for ads."
- Mobile experience: "A strong factor for conversion rates is overall user experience," Marin said. "Many websites still lack a robust mobile-optimized experience. Advertisers should ensure that all parts of their conversion path are well-optimized for mobile devices, and specifically smartphones."
- Mobile conversions: Smartphone advertising tends to have conversions that happen via a "non-standard pathway," Marin said. This includes things like calls or in-store visits. "This can lead to difficulties recording these conversions and acknowledging that they are mobile-influenced. Marketers should look into tracking mobile ad formats like click-to-call and store-locator" to better estimate revenue from mobile.