Google Paid-Search CPCs Rise As CTRs Decline

spinningtopIt's becoming a bit more expensive to run a search campaign. The average cost per click (CPC) for paid search ads rose on Google and Bing during Q3 2013, compared with the year-ago quarter, but fell on Yahoo.

The average paid search CPC on Google rose 3.5% year-on-year (YoY), but fell 1.3% quarter-on-quarter (QoQ), and on Bing the cost rose 19.6% YoY and 0.9% QoQ, according to The Search Agency.

The State of the Paid Search Report summarizes paid-search trends across engines and devices. The report reveals that Google's average paid search CPCs rose on three device types -- the largest being tablets, about 14.2% YoY.

That's not the case for all engines. When Yahoo released Q3 2013 earnings Tuesday the company reported that CPCs on paid search ads -- excluding Korea -- fell 4%, compared with the year-ago quarter on 21% more paid-search clicks, respectively.

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Paid search clicks on Google continued to shift from desktops toward smartphones and tablets, which now contribute more than one-third of the search engine's clicks. While clicks on desktops were flat YoY, search clicks on tablets rose 63.4% and clicks on smartphones more than doubled.

Overall, click-through rates for paid search ads fell 15.2% in Q3 YoY and 14.6% QoQ, after a sharp jump in Q1 2013. The report also points to an uptick in CTRs for product listing ads (PLAs), although the average CPC for PLAs fell 25.2% YoY and 1.9% QoQ. PLA clicks on smartphones and tablets contribute more than 31% of total PLA clicks compared with only 5.4% in Q3 2012.

Google's average paid search ad CTR fell 27.1% YoY and 18.6% QoQ. Bing's average CTR rose 32.2% YoY and 1.6% QoQ, enabling Microsoft's engine to close the gap when it comes to clicks between the two search engines to the lowest levels in five quarters.

CTRs fell across all devices on Google, with the sharpest drop on desktops. Desktop CTR fell 31.8% YoY and 22.8% QoQ; smartphone CTRs, 19.3% YoY and 7.7% QoQ; and tablet CTR, 26.6% YoY and 6.9% QoQ.

The Search Agency's analysis for Bing finds desktop CTRs rose 29.6% YoY and remained unchanged QoQ. Smartphone CTRs fell 11.7% YoY but rose 34.4% QoQ. Tablet CTRs also rose YoY, up 56.9%, but fell 10.1% QoQ.

When it comes to organic searches on the engines, September search market share fell flat across the board, per comScore. The month left Google with 66.9%, even with August. Bing gained slightly with 18%, compared with 17.8%. Yahoo's share rose slightly from 11.3% to 11.4%. Ask took 2.5%, compared with 1.6% in August. AOL remained flat sequentially at 1.3%.

2 comments about "Google Paid-Search CPCs Rise As CTRs Decline".
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  1. Robert Payne from 7Search.com, October 16, 2013 at 9:29 a.m.

    Laurie, great statistics, but what are the real numbers? What are Google's, Bing's, or Yahoo's average CPC? What are the actual CTR's?

  2. Mike Einstein from the Brothers Einstein, October 16, 2013 at 5:32 p.m.

    Percentages of what?

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