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Pay-Per-Click Advertising Doing Better Than Expected, Study Finds

Pay-per-click (PPC) advertising channels will get a bigger piece of the ad spend during the next 12 months -- more so than advertisers expected. Three-quarters of U.S. marketers participating in Hanapin Marketing's The State of PPC annual survey say they plan to increase the amount spent in mobile PPC advertising during the next 12 months, with nearly as many -- 74% -- increasing the amount spent in Google AdWords.

Some 67% say they will give Facebook more, followed by Bing Ads at 60%; and display advertising at 50%. The study looks at where advertising will spend their budgets and how they expect to target consumers with relevant ads.

Hanapin Marketing's annual survey of the pay per click (PPC) advertising study -- The State of PPC -- found that 90% of advertisers say text ads are still the most proven ads for their business.

Many advertisers didn't expect to increase budgets this year, but did. Last year only 10% of paid-search experts projected the amount they spent in 2015 would increase, but more than 70% of respondents report increases to their actual budgets. 

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When asked how advertisers feel about today's PPC market and their success in terms of campaigns, 78% say they feel "really good"; 20%, "fair"; and 2% "poor."

Of the marketers surveyed, 41% will spend less than $1 million this year, 16% will spend between $1 million and $2.5 million this year, with 43% will spend more than $2.5 million. Last year only 20% of respondents spending more than $1 million annually on paid search, but this year 59% admit to spending more than that amount.

The survey found a slight difference in opinions on what has been and will become important in pay-per-click advertising for agencies and the brands they serve. Most agree social advertising and conversion rate optimization are the two most important aspects heading into 2016. Some 75% say they will focus on conversion rate optimization, followed by 74%, social advertising; 61% automation software; 60%, specialized targeting; 54%, mobile location; 52%, data management; 43%, social commerce; 42%, new ad network; and 34%, programmatic.

During the next year, Hanapin expects to see a surge in agencies recommending that clients take advantage of specialized targeting, pointing specifically to the use of mobile location as intent.

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