Significant Rise In Mobile Search Budgets, Targeting

by , Jul 12, 2012, 9:13 AM
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Paid-search marketers have finally caught on to mobile predictions that forecast U.S mobile commerce will reach $36 billion by 2015. Analysts expect global revenue from mobile advertising and content to reach $67 billion this year. Tablet campaign search budgets rose 40% in Q2, contributing to the rosy forecast, according to Marin Software.

It may seem small, but marketers allocated 7% of their search budget in June -- up from 5% in March.

The Marin study looking at online advertising trends in Q2 2012 reveals that smartphone and tablet devices accounted for an 18% share of clicks and a 14% share of budgets for U.S. search marketers in June 2012. Budgets grew quickly as marketers realized positive performance, and consumer adoption drove stronger results for click volume.

Desktop and laptop computers still take the majority of search spend, but Marin identified positive trends as marketers explored new platforms. Targeting by device holds promise for marketers. Smartphones accounted for 10% of all paid-search clicks, and tablets, 8%. Share of clicks on tablets in the U.S. grew 33% sequentially. Paid-search ads running on tablet devices continue to show favorable performance compared with ads serving up on desktop and laptop devices.

Overall, click-through rates in the United Kingdom were higher than the U.S. Tablet devices show nearly 50% higher CTRs at 4.4% for the U.K. versus 3.0% in the U.S.

Marketers in the U.K. spent more on tablet devices compared with smartphones and computers, as a percentage of total budgets, 8%, 5% and 87%, respectively. Clicks on tablets accounted for 9% and smartphones 11% in June 2012.

For the Eurozone, the paid-search spend by match type shows that broad-match keywords lead with 50% of budgets and exact match at a little more than 30%. For paid-search clicks by match type, exact-match keywords rose in click share by 12%, from 42% to 47% during the last year.

CPCs continue to rise, but have not reached the price of those on desktops. Matt Lawson, VP of marketing at Marin, said the adoption of search on tablets continue to climb. "Mobile strategies and targeting are becoming almost universal," he said. "Customers are beginning to direct budgets to mobile. Not just by geography, but device."

As Needham & Co. analysts point out in a recent report, consumers initially preferred to use mobile devices for research. The $36 billion the firm estimates mobile will generate in commerce within a few years will lead to an increase in paid-search ads that click through to landing pages where consumers can make a purchase completing the conversion path.

The smartphone puts a store in consumers' pockets. comScore suggests some 67% of U.S. smartphone owners performed shopping-related activities in September 2011, including comparing products and prices, searching for deals, taking product photos, or locating a retail store. Analysts expect mobile purchases to eventually become the preferred method to purchase goods and services.

1 comment on "Significant Rise In Mobile Search Budgets, Targeting".

  1. Suzy Sandberg from PM Digital
    commented on: July 13, 2012 at 7:08 a.m.
    I think the numbers for mobile search would be higher if the process for executing the mobile and tablet search campaigns was easier. Essentially, everything in the desktop campaign needs to be structured and set up separately for tablet and then again for mobile. For search campaigns that are quite large and built out, there is an opportunity cost for the account manager in spending time building out these mobile and tablet campaigns fully when they could be spending time building out the desktop campaing. As a result, often only the best performing ad groups are getting designated for mobile and tablet which is only a result of lack of time on the account manager's part. If it was streamlined and easier, it would be interesting to see how much higher the mobile and tablet search numbers would actually be.

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