US paid search spending grew 15.5% year-over-year in Q2, representing a slowdown from Q1’s 30.3% growth rate, per a June report [download page] from IgnitionOne. Despite the overall pace settling back, mobile paid search continued to grow at breakneck speed, with a dramatic 333% increase year-over-year, following a 221% rise in Q1. Mobile accounted for 14% of total US search budgets in Q2, up from 12.3% in the previous quarter. Mobile’s growing importance was similarly seen in a Performics report in May: the company continues to find mobile taking up a larger share of budgets among its aggregated client base.
CPCs Show Slight Growth
Data from IgnitionOne’s Q2 report indicates that total cost per click (CPCs) rose 2.1% in Q2, after increasing 0.9% in Q1. Google CPCs continued to fall, down 3.1%, which the report attributes to increasing reliance on mobile’s cheaper CPCs, as well as increasing use of new formats which are typically lower PPC clicks. By contrast, Yahoo!/Bing saw a significant 24.3% rise in CPCs.
Meanwhile, clicks increased 13.2% year-over-year in Q2 (compared to 29.1% in Q1), while click-through rates (CTRs) were flat, bringing to an end an upward trend. On a brighter note, impressions rose by 13.7%, faster than Q1’s growth rate (7.2%).
Tablet Share of Mobile Search Spend Drops
Tablet devices accounted for 60% of the total mobile search advertising budget in Q2, down from Q1’s 67.4%. Factoring in mobile’s role in total US search budgets, though, and tablets’ role in the overall picture remains steady: the devices accounted for 8.4% of total paid search budgets in Q2, virtually unchanged from 8.3% in Q1.
Along with mobile’s growth in search spending, impressions were also up 130% year-over-year, and clicks posted a 325% gain.
- Travel search ad spend jumped 37.8% in Q2, after rising 22.8% in Q1. Impressions for the vertical also grew 61.9%. The report suggests a portion of this increase can be attributed to a growth in tablet and mobile search advertising efforts. Indeed, according to recent research from Millennial Media, the travel vertical experienced a 200% rise in ad spend on the company’s mobile network in Q1, taking it to the third spot among the top 10 global advertising verticals. Advertisers may be paying attention to recent figures from comScore, which revealed that 1 in 2 smartphone users access travel content on their devices.
- Per the IgnitionOne report, Google held 79.1% share of the market in Q2. Yahoo!/Bing search ad spend grew 32.9% year-over-year, compared to Google’s 11.4% growth.
About the Data: IgnitionOne’s data is based on a series of reports which have tracked more than 88 billion impressions and more than 2 .1 billion clicks on Google and Yahoo!/Bing search networks, Google AdEx, and other display networks from January 1, 2006 through June 15, 2012.