• by Laurie Sullivan , Staff Writer @lauriesullivan, April 18, 2013

Google releases Q1 2013 earnings today, just as The Search Agency releases its quarterly State of Paid Search Report--Q1 2013 analyzing paid search and product listing ads for the quarter. It turns out the agency's clients spent more for search advertising across Google sites and the Yahoo-Bing network in the first quarter. Spend rose 21.6% year-over-year (YoY), according to the findings. 

What led to the increase? The 8.8% YoY rise in cost-per-click (CPC) and 15% rise in search click-through rates (CTRs) that led to an increase of 11.7% in overall clicks, through impressions fell 4% YoY in the quarter, according to the report.

Bing's share of ad budgets rose 21%, up 3.6% YoY and 3% sequentially, after four consecutive quarters of splitting the market share. Microsoft's search engine also saw strong growth on budgets for tablets, increasing from 10.6% to 15.3%, compared with the year-ago quarter.

Clicks were all over the map, depending on the hardware. Tablet CPCs rose 18.2% YoY, but fell 5.8% sequentially, and click share rose 78.2%. Desktop CPCs rose 12.1% YoY, but fell 2.7%, sequentially. Marketers spent 135% YoY for tablet ads. Consumers increased click volume on smartphones by 86% YoY.  And despite a 10.4% drop in smartphone CPC, advertisers spent 68% YoY for ads running on smartphones.

Product listing ad clicks coming from smartphones and tablets rose 100% and 59.7% sequentially, respectively. PLAs remained popular in the quarter. Spend rose 530% YoY, but fell 25% sequentially. Impressions rose 537% YoY, but increased just 11.2% sequentially.  

Tablets took 9.9% of PLA clicks for the quarter. Smartphones made up more than 2% of PLA clicks. Overall, PLA clicks rose 653% YoY and 25%, sequentially.