Paid Search in Tablets Up 40 Percent from Previous Quarter

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ADOTAS – The share of clicks on paid search ads on smartphones and tablets has increased from 14 percent for the first quarter of 2012 to 18 percent for the second quarter, and on tablets, the share of paid search spend grew by 40 percent, according to the latest U.S. Online Advertising Quarterly Report issued by digital ad management platform provider Marin Software.

Looking at data from over 1,500 advertisers and agencies — a group that Marin says spends a total of $3.5 billion per year on biddable media via Marin’s platform — the company found clicks from mobile devices on the rise, both a lower cost per click (lower by 18 percent) and a higher click-through rate (42 percent higher) in paid search ads on tablets than on desktops or laptops, and a growing share of paid search budgets going toward tablets (which accounted for 5 percent of budgets in the first quarter and 7 percent in the second — still not even 10 percent of total search budgets, but nonetheless a 40 percent increase in spending).

To break down what kinds of devices accounted for those paid search clicks, 10 percent of such clicks came from smartphones and 8 percent from tablets. For tablet devices, that’s a growth of 33 percent from the previous quarter. Indeed, Marin credited the performance of paid search ads on mobile devices and the wide adoption of mobile as factors in why more budget share has shifted over to mobile. That seems fairly obvious: More people have smartphones and tablets, and we’ve seen paid search do well there, so advertisers are willing to spend more money there. In an email exchange, Marin director of research and partners Gagan Kanwar went further, crediting the performance of paid search on mobile to a “couple of reasons. One certainly is the form factor differences between the mobile devices and desktops. Smartphones and tablets have smaller screens, fewer search results, etc. … which results in more ad clicks. Another reason is the use-case scenario for each device. There is a mobile factor to both devices, particularly smartphones, where the user is able to search while on the go for information, a store, location, etc.”

Kanwar pointed out that the study showed click share had increased in the second quarter for tablets, but the share for smartphones had remained essentially the same. It’s not a matter of smartphones declining, he said, but one of attention to tablets increasing, and in a way showing search advertisers trying to catch up to the degree to which tablets have been adopted among the public. “We attribute the growth of clicks on tablets to an increase in user adoption of tablets (more people buying and using tablets), a higher user engagement with ads on tablets compared to desktops, and advertisers investing more in ads on tablets (more ads being served than previously),” he said.

While the attention is there, questions linger about what a click on a search link on a mobile device means. Kanwar observed that “about one third of all searches on a smartphone have local intent, and to that degree they lead to commerce, but not necessarily m-commerce,” but he acknowledged, “Right now, the role a mobile click plays in a purchase isn’t being accurately measured. A shopper may conduct a search for a store, click on an ad to get a location and then go buy something at that store, but that mobile ad click isn’t given credit or at least partial credit for that purchase.” He predicted advertisers will eventually get smarter about measuring these factors, and he pointed to, as an example, Marin’s recent partnership with RevTrax, “which allows advertisers to link their paid search campaigns to in-store coupon redemptions. Coupons can be redeemed via smart phone, so advertisers can track in Marin how many people clicked on an ad with their phone featuring the coupon and used the coupon on their smartphone to make a purchase.”

The full whitepaper is available for download now at Marin’s website.

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