Tag Archive for: paid search

Mobile CPC Growth Is Up Despite Losses Elsewhere

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While display cost-per-click (CPC) growth is steadily falling, Adobe’s new Digital Advertising Report shows the opposite is happening on smartphones.

Using aggregated, anonymized data gathered over the past three years, Adobe assessed over 489 billion digital ad impressions. According to the data, click-through-rate (CTR) growth is consistently rising, but CPC growth how hit a steep decline over the past year, especially between Q4 and Q1.  At this point, there is a 33-point gap between CTR growth and CPC growth, despite the two being nearly equal at this time last year.

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However, smartphones seem to be bucking the trend. Mobile CPC growth is up 16 percent while CTR shows a 9 percent decrease year-over-year, leading to a 25-point gap. Adobe’s team believes the so-called “mobilegeddon” is largely responsible for the spike in mobile paid search.

The team also said price is another favor facilitating the increase in CPC growth on smartphones. According to Tamara Gaffney, principal analyst for Adobe Digital Index, clicks on mobile are cheaper than desktop clicks, but the trend is unlikely to stick around.

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“Mobile advertising’s lack of perceived value causes a mobile search click to be worth 37 percent less than a desktop search click,” she says. “Conservative and incremental approaches to tackle ‘mobile stress’ are insufficient to bridge the gap. Disruptive and innovative changes will be required in order to drive future business success on both the publisher and marketer side.”

Facebook also saw a 23 percent increase in clicks, despite showing half the impressions year-over-year. The social platform’s CPC has largely stayed stagnant, but CTR growth has shot up 99 percent YoY.

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Adobe says Facebook’s huge increase is the result of improved targeting on the platform, with 51 percent of U.S. consumers saying they believe Facebook ads are genuinely of interest, compared to just 17 percent of consumers on YouTube. Gaffney also said Facebook has decreased the overall number of ads it shows users to create a better balance for users on mobile screens.

“[Google is] starting to lose ground as a marketing vehicle and part of the reason why is because they aren’t getting as many clicks out of global display ads,” Gaffney says.

Google has dominated the search market for years, but the latest findings show they are slowly losing ground. Google still holds 65 percent of the global search spend share, and 61 percent in North America, but Yahoo and Bing’s combined efforts is gradually rising 4 percent year-over-year.

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Paid Ads Perform Better When Combined With Social Ads

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Marketing has become a holistic practice. You can’t just focus on one channel and expect to have the impact that those who are using every method to connect with the public are getting. For online marketing this means you can’t rely on just SEO or PPC to get the visibility you want. A new study from the digital marketing tech company Kenshoo proves this point by showing that marketers using social advertising and paid ads together see better conversion rates than those who only use a single channel.

In what Search Engine Watch reports to be the first study of its kind, Kenshoo discovered that when a person was exposed to both a brand’s Facebook ads and paid search ads, there was a 30 percent more return on advertising spending than when a person was only exposed to paid search ads exclusively.

“The fact that Facebook advertising on its own during this study was declared a successful initiative and had such a strong impact on paid search is indicative of the power of the platform,” Kenshoo said in its report.

Kenshoo PPC and Social Ads Report

“If marketers only had one Key Performance Indicator (KPI) to compare media channels, the metric of choice would be ROAS [return on ad spend], which is calculated as Revenue/Cost. For example, if an advertiser spent $20 and generated $100 in sales it had a 5x ROAS. Even media with different conversion goals can be easily evaluated based on how much it returned versus how much it spent.”

Kenshoo also noted that click-through rate improved along with returns on ad spending. Paid ads saw a 7 percent increase in CTRs when a person had seen both Facebook and PPC ads, “indicating that social advertising was able to positively impact consumer awareness and perception of the brand.”

When combined, search and social advertising also resulted in 4.5 percent lower cost per acquisition, according to Kenshoo.

“On the surface, 4.5 percent may not seem significant when compared to some of the other high numbers reported in this study,” Kenshoo said, “yet ask any advertiser if they could lower their costs to bring in orders by this amount and they would all jump at the opportunity.”

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