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Study: Search-Ad Clicks On Mobile Devices Are Growing Faster Than On PCs

In the world of search advertising, mobile phones and tablets continue to outpace performance of search ads on PCs, although they still represent only a fraction of impressions and investment, according to a new report.

Quarterly figures from Marin Software indicate that mobiles and tablets accounted for 10 percent of all search ad clicks in the U.S. in Q4 2011. That is double the amount of clicks seen on those devices in Q3 2011.

On tablets, search ads — the ad units that typically appear alongside a search made through engines such as Google (NSDQ: GOOG), Yahoo (NSDQ: YHOO) or Bing — also accounted for the highest of all click-through rates.

Tablets’ CTR (the ratio of clicks/the number of times the ad appears) for the quarter, according to Marin, was 1.31 percent, compared to 0.95 percent on desktop computers. Smartphones had nearly as high of a CTR, at 1.25 percent. Marin does not break out which devices are proving “more” interactive, although recent figures from Jumptap indicate that at least on its network Apple (NSDQ: AAPL) devices continue to dominate in interactivity.

Search advertising is currently the most-popular form of interactive advertising, above display, and video and other rich media. It’s the case as well in mobile, where search is projected to have accounted for $349 million of the estimated $1 billion spent on mobile ads. But overall, PCs are still a vastly more popular platform for searches, and subsequent search ads. Marin notes that in the last quarter, mobile devices accounted for just seven percent of impressions on search ads, with PCs taking 93 percent:

On PCs search ads were estimated to have accounted for 25.6 percent of $73.8 billion spent on online advertising, or $18.9 billion, according to Publicis’ ZenithOptimedia.

Marin, which offers an online advertising management platform to brands and agencies, says that it based its conclusions on its own Marin Global Search Index. This includes more than 1,000 advertisers and agencies that invest over $2.7 billion annually in paid-search, which each brand or agency typically spending over $1 million annually on paid-search, social and display.

There are a couple of reasons why the numbers could be higher for tablets and mobile phones, which are worth pointing out here. As mobile ad skeptics have pointed out in the past, it can be much easier to “click” accidentally on ads on a touchscreen compared to a PC. That is partly due to the touch element, but also because of the smaller screen sizes. At some point advertisers might start demanding better metrics to try to account for accidental clicks on touchscreen and other mobile devices.

The other issue that could account for the rise in clicks in Q4 in particular is the fact that it covered the holiday season. As we’ve seen from other studies, mobile devices had a double-whammy for increased use over that time period, as people received or bought new devices for themselves as presents; and others used them to look for goods other information related to the holiday shopping season. We’ll have to keep an eye out how numbers look in Q1 of this year to see whether the increased clicks are a trend, or a seasonal blip.

Other changes that Marin noted in its quarterly report:

— Click volume is up by 56 percent across Google, Yahoo and Bing, while paid search spend increased 35 percent (note: Marin does not give hard figures for how much its customers actually invested in the quarter).

— Google’s clicks grew by 48 percent, and so did its CTR.

— Impressions are growing on Yahoo and Bing, which were up by 43 percent compared to the same quarter a year ago, and clicks were up by 44 percent. Marin attributes some of this to the companies’ new search alliance. However, the sites are still not getting more effective in their search ads: CTRs only increased by one percent.

— It’s still early days at Facebook. Marin also broke out how search ads are performing on Facebook and the numbers are still pretty low, with only a 0.1 percent CTR and $0.23 cost per click (CPC). That doesn’t look too good compared to Google and Yahoo/Bing who respectively had CTRs of 2.36 percent and 1.61 percent in Q4 2011. CPCs at for the portals were respectively $1.02 and $0.85. To be fair, Facebook is putting more effort, and seeing more success in display ads, although you can be sure that as Facebook grows even bigger it will look to improve its position in search against the likes of Google, too.