• by Laurie Sullivan , Staff Writer @lauriesullivan, October 16, 2014

Mobile budgets are finally feeling a little love as marketers plunk down more of their search budget to run smartphone search ads. Overall, marketers spent between 20% and 27% more in the quarter. With the flow of more money into mobile channels, however, come challenges to win bids and catch the eye of consumers on a small screen.

Diminishing ad real estate on mobile search engine results pages (SERPs) intensifies the bidding process, making it more competitive. It means that brand marketers must rethink bidding strategies and tailor ad copy for mobile experiences to boost overall impressions. With the flow of more money into mobile channels, however, come challenges to win bids and catch the eye of consumers on a small screen. 

The Search Agency's State of Paid Search Report summarizes paid-search marketing trends among the company's clients. Findings and forecasts are based on year-over-year (YoY) and quarter-over-quarter (QoQ) analyses on aggregated client data. The findings indicate a huge shift as money transfers from desktop to mobile.

The shift means a higher percentage of shopping ad impressions on mobile, which takes space. Brands also continue to transition from broad-match toward exact-match strategies, partly due to a YoY 24% CPC increase for broad-match terms. The change in strategy forces brands to see fewer, more targeted impressions.

Among TSA clients, Bing saw YoY growth in both impressions and clicks on mobile this quarter. Q3 represents the fourth consecutive quarter of impression share growth for Bing. On smartphones, Bing's share rose 223% compared with the year-ago quarter, and tablets rose 109%.

The report calls out several reasons for the shift. Bing's partner network drives an influx of impression traffic toward smartphone and tablet devices, serving ads outside of the typical SERPs, and in places where users are not ready for clicks. It diminishes CTRs on these devices.

Advertisers saw a 440% increase in smartphone impressions and 220% in tablet impressions on Bing's partner network in Q3 2014, compared with Q3 2013.

Initially, Google offered the greatest opportunity for advertisers to invest in mobile strategies, but Microsoft made many more improvements in its search marketing advertising services, making it easier for advertisers to spend more on Bing, per TSA.

Google and Bing saw a YoY increase in overall clicks during Q3. Google clicks grew 13%, whereas Bing clicks rose 11%. As for CPCs, Q3 saw a 13% decline on Google and a 40% increase on Bing YoY. By device, Bing CPC increased 76% on tablets.

In Q3 2014, marketers spent less on Google -- down 2% -- and 55% more on Bing compared with the year-ago quarter. Overall, paid search clicks grew 12.6% and click-through rates jumped 41.3% as markers increased budgets by 6.8% in Q3 2014, compared with the year-ago quarter. Impressions declined 20.3% and the cost per click fell 5.1%.

"Smartphone user" photo from Shutterstock.