U.S. paid search spending in Q4 up 22% year-over-year with mobile search advertising spending up 269% and mobile ad impressions up 317%; mobile search ad spend accounts for 14.2% of total paid search budgets, up from 5.2% last year
January 11, 2012
– The year ended with an extremely strong Q4 for online advertising as U.S. paid search spending grew 22% year-over-year resulting in the best quarter to date. Retailers drove much of this spending, as holiday shopping initiatives pushed their search budgets up 26% year-over-year. Mobile search advertising among retailers was up a huge 269% YoY and accounted for 14% of total retail search budgets - peaking at 24% on Black Friday.
These figures are released quarterly by IgnitionOne, a leading digital marketing firm, managing more than $1 billion in online advertising.
Key findings in the report:
-- U.S. Mobile search is growing at an enormous rate -- YoY mobile search ad impressions are up 317% and spend is up 269%. Among retailers, mobile search ad spend accounted for 14.2% of total paid search budgets, compared to 5.2% last year. This spiked on Black Friday with 24% of retail search ad spend going towards mobile queries.
-- U.S. Search advertising has its best quarter ever -- It was a strong holiday season for search with advertising spend up 22% YoY in Q4. Search advertising spend among retailers was up even higher at 26% YoY. There were also large YoY increases in impressions (42%), clicks (42%) and transactions (67%).
-- U.S. Search costs (CPCs) declining -- In total, Q4 CPCs are down -8.6% YoY and -2.3% compared to last quarter. This trend benefits marketers as clicks cost less while monetizing at the same rate and benefits Google through expanding impression base and higher clickthrough rates pointing to revenue growth for Google. The trend is driven by Google, as Yahoo!/Bing saw a YoY 6.4% increase in CPCs.
-- Google retains U.S. market share lead - In mid-Q4, Yahoo!/Bing held only a 16.6% share of the search market, but as expected, given its retail consumer focus, it rebounded with a stronger holiday shopping season. However, by the end of Q4, search market share remained largely unchanged from the previous quarter, with Google commanding 81.8% compared to Yahoo!/Bing at 18.2%.
-- Europe search advertising also on the rise -- Q4 shows gains for European search advertising as spend increased 14%, clicks increased 22% and Clickthrough Rate (CTR) increased 19%.
-- Google continues to grow in display -- U.S. spending on display advertising was up 9.3% and impressions were up 31.5%. The growth for Q4 came from Google's DoubleClick Ad Exchange, which saw a 105.5% increase in spend.
"Adoption of smart phones and tablets is exploding and mobile search is becoming a major part of the shopping experience for many consumers," said Roger Barnette, President of IgnitionOne. "Advertisers are responding to this trend, which is clearly shown in the enormous growth of mobile search advertising spending."
IgnitionOne's complete Q4 Global Online Advertising Report can be downloaded here.
This report is the latest in a series of reports from IgnitionOne reviewing trends across the online advertising landscape. Previous quarterly reports can be downloaded at http://bit.ly/ignitiononeresearch
IgnitionOne is the world's first closed loop Digital Marketing Suite, offering multiple solutions to improve online performance within a single interface. Solutions include ad management and optimization (search, display and Facebook), cross-channel attribution and website optimization.
Ignition One currently powers more than $30 billion in revenue each year for some of the world's leading online marketers, including General Motors, Chico's, Ann Taylor, Fiat and advertising agencies such as MRM Worldwide, CyberAgent and more.
For more information, please visit http://www.ignitionone.com or follow the company on Twitter @ignitionone.
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