Marketers spent 16% more on search budgets in Q1 in the U.S. and 3% in the U.K. compared with the year-ago quarter, according to a report published Monday. The Adobe Systems Global Digital Advertising Q1 2012 Update reveals that ROI for campaigns in the United States rose 11% in the quarter compared with a year ago. Finance and automotive demonstrated the most increases, while the retail sector fell 5%. The minimal increase in U.K. search spend reflects the fragile state of the European economic recovery. Marketers also spent more on mobile campaigns; they allocated 8% of all search spend in the U.S. and 11% in the U.K. Of this, tablets accounted for 4.25% of search spend. Because costs per click (CPC) on tablets came in lower compared with those on desktops, despite comparable conversion rates, mobile and tablet advertising investments will become more appealing to advertisers in the short term. Justin Merickel, director of product innovation at Adobe, said conversion rates on tablets are stronger than PCs, but that's not true for search on handsets. "It outperforms desktop search," he said. The tablet is driving the increase in ad spend. It has grown from virtually zero in May 2011. Spend on tablets now exceeds smartphones, with the inflection point occurring in October 2011. As for Google, CPCs fell 5% year-on-year, but Bing and Yahoo rates rose 18% as marketers took advantage of better returns per clicks. As a result, the ROI advantage over Google no longer exists. When Yahoo Japan converted to the Google ad-serving platform from Bing-Yahoo, CPC rates dropped significantly, according to the report. Changes to Google's search algorithm contributed to growth in marketers spending more of their budget on search. The report suggests that increases resulted from an increase in click volume rather than an increase in CPC rates. While it has been true for the past two quarters, it is contradictory to trends in prior quarters. The report suggests that "algorithmic changes to Google in Q4 2011, such as increased site links, have led to a greater proportion of branded traffic that does not impact CPC rates." Analysis from the Adobe report suggests that U.S. marketers will continue to allocate more of their budgets to search for the remainder of 2012. The study points to an uptick between 10% and 15% in the amount spent by marketers on search as a bellwether for the state of the U.S. economy. The Bing and Yahoo alliance is at risk of losing market share, per the report. For the past few quarters in the U.S., the duo produced higher RPC rates and ROI compared with Google, but the advantage the two had diminished this quarter as a result of declining CPC rates on Google and an 18% CPC increase on Bing and Yahoo. Bing and Yahoo must continue to increase reach to obtain more click volume and focus on reducing CPC rates to sustain market share and regain market share lost to Google. Today, mobile devices get about 8% of search marketing budgets. The report suggests that tablets and smartphones will take a larger share, reaching between 15% and 20% by December 2012; the growth driven by an interest in other digital marketing channels yielding the same ROI as desktop search, only with lower CPC rates. Brands will continue to double the Facebook fan base in 2012, but CPC rates on the site should decrease. While Facebook ad CPC rates rose 40% sequentially for the past three quarters, CPC rates on Sponsored Stories tend to be lower than Marketplace Ads, which may contribute to temporary decreases, according to the report. Data for this report comes from the former Efficient Frontier, acquired by Adobe in January 2012.
Mobile advertising continues to shake up traditional ad investments for a variety of media. For call tracking, the shift continues to move dollars from national to local ads. Some 61.6% of the pay-per-call share resides in local ads vs.national -- the opposite of a year ago, according to analysis from Telmetrics, which measures pay-per-call ad tracking. Early adoption in pay-per-call tracking originated in national advertising about three years ago, but the most growth today comes from local, small businesses. Pay-per-call ads experienced the most growth from mobile, jumping more than 30 times since last year. Telmetrics tracked about 348% more pay-per-call ads in Q1 2012, compared with the year-ago quarter. The durations of the calls also have increased, suggesting that more advertisers are optimizing campaigns and programs looking for higher-quality leads, according to Bill Dinan, the company's president. "Mobile marketing has opened the door to call-based segments for SMBs," he said. "We have reached the point where SMB marketers can monetize the activity. Calls are worth more, marketers understand it, and they are willing to pay for it." On average, call durations rose 20.1% since Q1 2011. Mobile call durations remain the longest at 3.5 minutes per call, followed by Yellow Pages at 2.8 minutes per call, Internet Yellow Pages at 2.7 minutes per call, and paid search at 2.2 minutes per call. There also was a perceived barrier to entry for those offering pay-per-call services to small and medium-sized businesses. Along with direct media, mobile changed that, Dinan said. Between 35% and 40% of growth today from call traffic from seeing an online ad comes from mobile, and about the same for print Yellow Pages -- followed by billboard, direct mail, and PC-based search. Mobile and local convert well to actions, making it a valuable market segment for pay-per-call ad tracking, which will grow as smartphone and tablet devices proliferate. About $12 billion of advertising revenue will go through mobile this year worldwide, partly as a reesult of device proliferation, according to a GroupM study. Smartphone adoption continues to spike. "People ages 75 years and older are also adopting smartphones, which breaks down the barriers we once knew," Dinan said. "IT puts content in the hands of more consumers."
Google potentially confuses consumers by allowing companies' trademarked names to trigger competitors' pay-per-click ads, an appellate court ruled on Monday. In a 47-page decision, the 4th Circuit Court of Appeals ruled that Rosetta Stone presented enough evidence to justify a trial about whether consumers were confused by AdWords ads. The pay-per-click ads -- for companies other than Rosetta Stone, including sellers of counterfeits -- were displayed to users who typed "Rosetta Stone" into Google's query box. "We conclude that a reasonable trier of fact could find that Google intended to cause confusion in that it acted with the knowledge that confusion was very likely to result from its use of the marks," the appeals court wrote. The ruling reversed U.S. District Court Judge Gerald Bruce Lee's 2010 decision dismissing Rosetta Stone's trademark infringement lawsuit. The case dates to 2009, when Rosetta Stone alleged in a complaint filed in Alexandria, Va. that Google's AdWords policies gave competitors a free ride on Rosetta Stone's trademarked name. Rosetta Stone also alleged that its trademark was being used by counterfeiters, who duped consumers into purchasing bogus software. Rosetta Stone presented depositions of five consumers who said they were tricked into purchasing counterfeits after conducting Google searches for Rosetta Stone. The language learning company also presented surveys showing that a significant percentage of users who search for "rosetta stone" are served ads for competitors" and "are likely to be confused as to the affiliation, endorsement, or association" of those ads. Google's own in-house surveys also showed some confusion when trademarked terms were included in the body of pay-per-click ads, according to the appellate opinion. Lee discounted the anecdotes and surveys, but the 4th Circuit said that evidence created "a question of fact as to consumer sophistication that cannot be resolved on summary judgment." Google could still prevail when the case returns to district court, but the decision to order a trial will "almost certainly" encourage other marketers to take on Google, says Santa Clara University law professor Eric Goldman. "This opinion likely dooms Google to spending millions of dollars more to defend its practices." Legal questions surrounding keyword advertising will continue. "This ruling probably pushes back the date when keyword advertising sales are legal and acceptable in the United States by five to 10 years," Goldman says. A Google spokesperson says its policy of allowing a company's trademark to trigger ads for competitors is consumer-friendly. "Users searching on Google benefit from being able to choose from a variety of competing advertisers. We think that the legitimate use of trademarks as keyword triggers helps consumers to make more informed choices," the company said in a statement. Google added that it is "confident" it will ultimately prevail.
Following a March 15 Wall Street Journal article, “Google Gives Search a Refresh,” the topic of semantic search has again become a hot-button issue for SEOs and webmasters. In that article, author Amir Efrati refers to coming changes across Google results pages, largely derived from enhancements in its core semantic search capabilities, as “among the biggest in the company’s history and could affect millions of websites that rely on Google’s current page-ranking results.” If this “new” news is to be believed, then Google appears primed to make good on its promise to better understand both the Web and the intent communicated by its user base through the queries entered. But is this really news? Semantic search, which according to Wikipedia is the process through which search technologies “improve accuracy by understanding searcher intent and the contextual meaning of terms as they appear in the searchable dataspace,” has been around for a while. Even over the course of the past year, Google has been assigning semantic meaning to content items that have been marked up with the microdata format advocated by schema.org. Recently, Danny Sullivan wrote an extensive piece on Google’s history with semantic search, and how this latest news appears to be little more than Google PR at work. So while this may not be an earth-shattering announcement, it does warrant investigation because Google has brought attention to it. Is there a bigger story here than meets the eye? Google Knowledge Graph Beyond schema, which is a Webmaster’s tool to communicate semantic instructions to the engines, Google is building what it calls the Knowledge Graph, a collection of information sources that help discern a user’s specified intent with each individual query, even providing for answers directly on the search engine results page where warranted. In the healthcare space (my new playground), Google “Symptom Search” is a great example of the Knowledge Graph in action. Enter into Google any symptom you may be experiencing (for example, “headache”), and Google will pull data from the Knowledge Graph to direct you to possible health conditions. The traditional ten blue links have been deemphasized in favor of possible answers to the user’s direct question. These types of interactions appear to be the future of search -- scary territory for SEOs who are accustomed to keyword-level optimization practices. Is SEO “Dead”? Every few months a new article is written proclaiming the death of SEO. In fact, it happens so frequently that it’s become something of an online meme within the SEO community. It’s easy to dismiss those pieces as largely hyperbole at work, but one caught my attention as being very timely and applicable to SEO in a Knowledge Graph environment. With “The Rise of Content Strategy – What To Do About Google Killing SEO,” James Mathewson teed up the challenges SEOs now face with semantic search: “How do SEOs traditionally optimize pages? By advising their clients to put keywords in strategic places on a page. When Google goes to semantic search, it won’t be as much about keywords at all, but on the meaning of the words you use. This might be the biggest SEO killer of all. If tuning our content for keywords our users care about is no longer an effective strategy, what is left for SEOs?” Mathewson goes on to advocate for a new flavor of SEO practitioner, the “content strategist.” I agree completely with that view, and see three things that SEOs need to do right away in order to prepare for a semantically driven future in search: 1) Become a content strategist – technical on- and off-page factors will continue to see a decline in importance. The most compelling and desirable content will win. I can’t help but think how this new thinking gels perfectly with the concept of storytelling and content curation through social media channels. This construct would be the ideal ying-yang relationship to content marketing across search and social channels. 2) Answer questions through content – keyword research will take center stage, and new software applications will undoubtedly be introduced that look to mine intent from raw keyword clusters. Understanding intent will become crucial during this research phase, because content will need to be crafted to specifically answer the questions posed through user queries. 3) Rally around standards like schema – a legitimate Knowledge Graph may one day render schema obsolete and unnecessary, but it’s the best we have to work with today. And an early adopter opportunity still exists in every industry vertical. By employing schema today, you will become better positioned for semantic search 1.0 and will be at the forefront when future enhancements are introduced. According to Amit Singhal, who heads Google Search, these initial forays into semantic search and Knowledge Graph in particular represent “baby steps.” Singhal says there’s a “long road ahead.” The best advice seems to be: Get on board now.