US paid search advertisers saw a 21% year-over-year increase in impressions and a 20% increase in click volume in Q3, according to [download page] a new report from Marin Software. Click-through rates (CTRs) were stable, while costs-per-click (CPC) continued to drop, down 14% to $0.82. But, not all verticals tracked followed this pattern. In fact, CTRs for each of the isolated verticals – auto, B2B, education, finance, healthcare, retail, and travel – all dropped on a year-over-year basis, with most of those verticals seeing increased CPCs. Among those verticals, travel saw the highest average CTR, of 2.8%, ahead of retail (2.49%) and healthcare (2.31%), while education (0.91%) had the lowest average CTR. Education had by far the highest average CPC ($5.15), more than 10 times that of retail ($0.35).

A separate report [download page] from RKG Digital finds that among its clients (that include 30 of the top 500 internet retailers), non-brand (competitive) paid search CPCs fell by 5% year-over-year, while brand term CPCs increased by 10%.

CTRs Far Higher on Smartphones

The Marin Software indicates that in the US, smartphones (11%) and tablets (8%) collectively accounted for almost 1 in 5 clicks, outdoing their combined 14% share of spend (which was split equally between smartphones and tablets). During Q3, CTRs were highest on smartphones (4.93%), ahead of tablets (3.3%) and computers (2.26%). CPCs were highest on computers ($0.77), slightly more expensive than on tablets ($0.65), and far ahead of smartphones ($0.49). The CTR and CPC results are consistent with Q2 findings.

The RKG Digital report saw smartphones and tablets having a combined 16% of paid search clicks in Q3. The iPad rivaled desktops for revenue per click, but all other mobile devices were far behind in this metric.

Facebook Ads Present Cheap Alternative

Examining Facebook ads across the US and Europe, Marin’s “Global Online Advertising Trends” report finds that in the US, the average CPC was $0.28, compared to the average paid search CPC of $0.82. Facebook ad CPC was even lower in the Eurozone, at just USD $0.11.

Even so, there was low engagement with Facebook ads across the geographies measured. The average US CTR rate was just 0.12% (0.13% in the Eurozone), far below the US’ average paid search CTR of 1.92%.

Google Maintains Share of Spend; CPCs Drop Slightly

Across its clients, Marin Software saw Google better monetizing its searches than Yahoo and Bing. For Q3, Google accounted for 69% of impressions, but 79% of clicks and 81% of spend. That pattern has remained consistent for several quarters. On a year-over-year basis, Google’s impression volume rose 19% and clicks were up 11%, with a 7% fall in CTR and a 4% drop in CPCs.

The RKG Digital report finds Google’s click growth at 28%, with CPCs down 3%. On a global basis, Covario reveals in its Q3 report [download page] that among its clients, Google accounted for 87% market share of spending and 91% of impressions, though just 66% of clicks.

Other Findings:

  • According to the RKG Digital report, Google Product Listing Ads accounted for 20% of Google’s paid search clicks, with a CPC 15% less than the average non-brand text ad.
  • Advertisers saw a far higher ROI for brand terms on Google than on Bing.
  • Organic search delivered almost 1 in 3 site visits in Q3, up slightly for the same sample than a quarter earlier. Referrals accounted for 7% of visits, with other sources accounting for the remaining 61%.
  • Facebook, Twitter, and Pinterest collectively accounted for less than 1% of site visits on average in Q3.
  • According to Covario, paid search spend in the Americas grew by 39% year-over-year and by 7% quarter-over-quarter. Google took about 90% market share in the Americas.

About the Data: To uncover key trends for the second quarter of 2012, Marin Software sampled its Marin Global Online Advertising Index, which includes over 1,800 advertisers and agencies that invest over $4 billion annually in biddable media through the Marin platform. The Marin Global Online Advertising Index consists of enterprise-class marketers”“larger advertisers and agencies who spend in excess of $1 million annually on paid-search, social, and display. As such, the data sample and findings skew towards the behavior of larger organizations and more sophisticated advertisers.

The RKG Digital figures are derived from samples of RKG clients who have worked with RKG for each respective marketing channel. Where applicable, the samples are restricted to those clients who 1) have maintained active programs with RKG for at least 19 months, 2) have not significantly changed their strategic objectives or product offerings, and 3) meet a minimum ad spend threshold. All trended figures presented in the report represent the average same-site change over the given time period.

The Covario report covers spending patterns of its clients, which largely consist of global high-tech and consumer electronics firms. The global clients leverage paid search advertising in more than 45 countries.

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