• by Jack Loechner , Staff Writer @mp_research, May 2, 2013

According to The Search Agency State of Paid Search Report, total search advertising spend across Google and Yahoo!-Bing increased 21.6% year-over-year, in addition to other findings using aggregated client data from various industries to identify paid search marketing trends across search engines and devices on a year-over-year (YoY - Q1 2012 to Q1 2013) and quarter-over-quarter (QoQ - Q4 2012 to Q1 2013) basis. 

Keith Wilson, vice president of agency products at The Search Agency, says “... mobile and tablets helped drive this growth exponentially... tablets continue to be a driving force... consumers (using) tablets to shop and buy... performance steadily increasing over the past five quarters... “

Key findings from The Search Agency’s State of Paid Search Report include:

Despite seeing impressions down 4% YoY, a 15% increase in search click-through rate leads to an 11.7% increase in overall clicks. Coupled with an 8.8% YoY increase in CPC, total advertiser spend across Google and Yahoo!-Bing increased 21.6%.

After four consecutive quarters of a relatively consistent market share split between Google and Bing, Bing’s share of advertiser spend grew to 21%, up 3.6% YoY and 3% QoQ.  Bing saw strong growth on tablets, increasing its share of spend from 10.6 to 15.3% YoY.

Consumers increased click volume on smartphones by 86% YoY.  And despite a 10.4% drop in smartphone CPC, total advertiser spend on smartphones was up 68% YoY. Total spend on tablets went up 135% YoY.

The retail industry saw tremendous growth on mobile and tablets YoY. Smartphone click share for retail increased 78.2% YoY and 69.9% QoQ. Tablet click share increased 71.8% YoY and 13.5% QoQ. Click traffic from smartphones and tablets for the retail and e-commerce sector was larger than any other vertical in the study looking at consumer and business services, media and entertainment, real estate and construction, travel and leisure, with 39.6% of clicks. 

Clicks on PLA (Product Listing Ads) increased enormously YoY and PLA clicks coming from smartphones and tablets increased 100% and 59.7% QoQ, respectively. Tablets came in at 9.9% of PLA clicks last quarter. For the first time, likely due to improvements to format and visibility on newer models, smartphones made up more than 2% of PLA clicks.

More information highlighted in the Executive Summary includes these facts:

• Google spend increased 17% YoY, driven by a 9% increase in clicks and a 7.5% increase in CPC YoY. Bing spend increased by 42% as a result of a 7.4% increase in CPC YoY, and a 46% increase in CTR YoY.
• Google’s percentage of clicks coming from smartphones increased 68.4% YoY and percentage of clicks coming from tablets increased 42.2% YoY. Bing percentage of smartphone clicks increased 45.3% and tablets increased 59% YoY.
• Advertisers are now spending 20.1% of their search budget on smartphones and tablets, which is a 37% increase in share of spend on smartphones and tablets YoY. Overall, spend increased 68% on smartphones and 135% on tablets YoY.
• Overall, smartphone CPCs decreased 10.4% and tablet CPCs increased 19% YoY, demonstrating the shrinking CPC discount from desktop on tablets and growing CPC discount from desktops on smartphones.
• Desktop CPCs increased 14% YoY, driven largely by a 12% increase in desktop CPCs for Google.
• Smartphone CPC discount from desktop is shrinking on Google.
• The retail/eCommerce industry experienced a 9% QoQ decrease in spending after the holiday season.
• Clicks for advertisers in the travel industry increased 11% and CPCs increased 19% YoY, demon­strating healthy industry growth and competition.
• The real estate industry experienced healthy growth, as clicks increased 19% YoY.

 For more information from The Search Agency, pleas visit here; or view the PDF file here.