Behavior Analysis Triggering Increase In Paid-Search Clicks

The ability for search engines to analyze behavior remains an extremely important consideration for marketers when designing and bidding on paid-search and product listing ads. Timing and optimization made a major impact on the amount of impressions served and clicked on during the holiday fourth quarter of 2013. While impressions on Google rose 38% and clicks rose 11.3%, compared with the year-ago quarter, those on the Yahoo Bing network fell 7% and 7.4%, respectively.

The Search Agency released its Quarterly State of Paid Search Report Tuesday analyzing Q4 client performance data. The report shows that marketers spent 37.4% more on paid-search marketing in the quarter compared with the prior year.

Google click-through rates fell 19.4% year-over-year, but rose 4.7% sequentially. Bing CTRs fell 0.4% YoY, but rose 12.9% sequentially. The cost per click on Google rose 24% YoY and 3.4% sequentially. Bing CPCs rose 44.8% YoY and 15.1% sequentially.

Overall in Q4 2013, the cost per click across search engines rose 27.6% compared with the year-ago quarter and 5.8% sequentially. CPC by device varied. During the holiday quarter, on Google CPCs on desktops hit $1.36, up from $1.09 in the year-ago quarter. Smartphone CPCs rose to $1.20, up from $0.96. Tablets rose to $1.46, up from $1.17, respectively.

CPCs on Bing told a slightly different story for the holiday quarter. CPCs on desktops hit $1.28 -- up from $0.90 in the year-ago quarter. Smartphone CPCs rose to $1.14, up from $0.56. Tablet CPCs rose to $1.34 -- up from $0.85, respectively.

Marketers also invested much more in product listing ads than some expected, with overall investments rising 165% YoY and 71% sequentially among The Search Agency clients. PLA tablet share of clicks rose 335.7% YoY and 40.4% sequentially, while smartphone PLA clicks rose 1589% YoY and 68.1% sequentially.

The Search Agency’s clients include retail, travel and leisure, customer service, health care, real estate, and construction. Growth was not limited to the retail industry. In fact, five out of the six industry sectors in the report experienced YoY increases in clicks, with the healthcare industry experiencing the largest gain. Impressions related to health care in Q4 rose 88.4%; and clicks, 98.3% YoY. Smartphone click share also increased 53.3 percent YoY, while tablet share remained relatively constant.

The sample of advertisers used to create the report had fifteen consecutive months of data with The Search Agency and an established business model from Q4 2012 to Q4 2013. All results are based on U.S. campaigns only. The agency measured key performance indicators on a YoY and sequential basis across search engines, devices, and six industry-specific groups. Some KPIs -- specifically impressions, clicks, and spend -- were indexed according to Q4 2012 data to more clearly represent overall trends.

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