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Amazon Takes Search Budgets From Google, Bing, Yahoo, Data Suggests

Marketers spent a whopping 77% more during the first quarter of 2019 on Amazon Sponsored Brands ads, formerly known as Headline Search Ads, while Amazon Sponsored Products grew 19% year-on-year in the quarter, according to recent data

Merkle’s Q1 2019 Digital Marketing Report, released Monday, suggests that Amazon Sponsored Products contributed 85% to total markets spend on Amazon for advertising. The ad placements on product details pages accounted for 41% of all Sponsored Products clicks, while the top-of-search results accounted for 33%.  

Brand keywords accounted for about a quarter of all Sponsored Brands and Sponsored Products clicks and about half of sales, with spend share roughly in line with click share.

And as Amazon’s ad business continues to grow, marketers are spending less on paid-search advertising on Google, Bing and Yahoo, marking the fifth straight quarter of declines.

Text ads are down, but Google Shopping continues to drive the search engine’s advertising growth. Spend on the format rose 41% year-on-year (YoY), compared with the 12% decline for text ads.

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Marketers spent a mere 2% more on search text ads running on desktop and tablet devices, compared with 46% growth on mobile phones -- up from 42% in the fourth quarter of 2018.

The cost per click (CPC) on brand keywords began to stabilize in the first quarter of 2019. CPCs rose by 6%, compared with the year-ago quarter. Phones and tablets combined accounted for 65% of all paid-search clicks for the quarter but just 44% of ad spend, as lower conversion rates on mobile devices continue to weigh on mobile CPC relative to desktop.

Click growth on non-brand terms improved to 13%, a six-quarter high, while non-brand CPC growth slowed to 3%, according to Merkle. Non-brand CPCs rose 13% on desktop and 12% on phones in Q1, but as traffic shifts to mobile, where clicks remain less expensive on average, overall non-brand CPC growth has slowed.

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