Mobile Growth Influenced By Clicks On Paid-Search Ads

Smartphone-Blackberry

By year's-end, mobile will contribute 25% to total paid-search ad clicks, up from 12%. By then, U.S. mobile campaigns will contribute about 23% to Google's paid-search revenue in the United States.

More consumers on mobile devices continue to click through on ads at a higher rate compared with desktop, according to Matt Lawson, vice president of marketing at Marin. "The small screen on the phone only allows room for one or two at the top, not six to 10 down the right rail," he said. "When Google renders results from a query, the paid ad may take up as much as two-thirds of the screen."

Device adoption and consumer behavior continue to drive the change. It appears that users do not scroll down the page to view the other content as much, Lawson explains.

Marin Software's report, The State of Mobile Search Advertising in the U.S., analyzes how smartphones and tablets change paid search across Google's network. The study does not include results on Bing and Yahoo. Google holds about 95% of the mobile search query volume, according to the company. The massive growth in paid-search clicks in mobile continues to rise, as a percentage of the total.

In 2011, advertisers increased their share of search budget on mobile devices from 3.4% to 8.7%. Despite efforts to continually increase spend on mobile, ad budgets still lagged the click volume, from smart mobile devices contributed. But that will change.

Marin's analysis in the report suggests tablets will account for 45% of all mobile clicks by December 2012. Smartphones and tablets have click-through rates at 72% and 31% higher, respectively, compared with desktop computers.

The report notes that there are fewer ad impressions served across newer devices. Still, the cost per click on smartphones and tablets remains much lower compared with desktop computers. Smartphone clicks are approximately 36% less expensive than desktop clicks. Tablet clicks are about 24% less than their desktop counterparts, according to the report.

In its determination of whether clicks on mobile devices will lead to mean­ingful and quantifiable revenue, Marin analysis points out that smartphones and tablets have much less available ad inventory because of constrained screen real-estate.

Lawson plans to keep a closer eye on Facebook, the single most popular mobile application. In the past month, Facebook announced that advertisers will have an option to target consumers through Sponsored Stores in the News Feed.

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