Adobe released their findings today on the impact of Google AdWords Enhanced campaigns on advertising click costs. To arrive at their conclusions they examined 100 U.S. advertisers spending more than $100 million between March and May of this year using Adobe’s Media Optimizer.
They found overall the cost-per-click (CPC) across devices was up 6 percent since March. The primary factor for this is the required upgrade to the Enhanced Campaigns that groups tablets, with historically lower CPCs, in with desktop ads, thus increasing overall costs. In fact, they found a 3 percent increase in tablet CPCs in the data they analyzed.
The migration to enhanced campaigns is optional until the July 22 deadline. As more advertisers switch over to meet the deadline, this is likely to further increase CPCs with new mobile bid adjustments (MBAs).
“With Enhanced Campaigns, MBAs control how much mobile ad spend is allocated versus desktops/laptops and tablets,” writes Sid Shah, Director of Business Analytics for Advertising Solutions at Adobe, “therefore, it is imperative for MBAs to be set precisely so ROAS/ROI is maximized across all devices.”
Four key trends are expected to take shape in the next six months:
- Algorithms will become more important for optimizing to the best ROI due to the increasing complexity of enhanced campaigns and bidding adjustments.
- Increasing CPCs expected by Adobe to rise by 5-10 percent, YoY due to enhanced campaigns and increased competitive.
- Increasing overall ad spend from 15-20 percent due to traffic and CPC increases.
- Tablet optimized sites become more important as advertisers focus on better user experience to increase conversions rates.
You can see Adobe’s full report here.
Update: Google has sent Search Engine Watch a statement regarding Adobe’s findings.
“There have been many speculative reports, but it’s far too early for any of them to be reliable,” according to a Google spokesperson. “Advertisers will choose their bids and adjust their spend based on the value they see in their campaigns.”