6/12/14

Paid search is going mobile in a big way

Mobile paid search ad spending will reach 39.5% of all digital search ad spending this year and 51.9% next year, eMarketer predicts. By 2018? 85.9%.

Bill Siwicki , Managing Editor, Mobile Commerce

When it comes to mobile advertising, mobile paid search dominates. This year, U.S. mobile advertising spending will reach $17.73 billion and mobile paid search spending will hit $9.02 billion, or 50.9%, of that total, according to new research from eMarketer Inc. Further, that $9.02 billion this year represents 39.5% of total digital search spending, eMarketer says.

Research firm eMarketer includes tablets and smartphones in its definition of mobile paid search. It’s important to note, though, that Google, which dominates the search market, only enables advertisers to target smartphones in its Enhanced Campaigns, lumping tablets in with desktop PCs. However, Google does report results on tablets to advertisers.

Following are the year, spending on mobile paid search ads, and the percentage of total digital search ad spending, according to eMarketer:

Mobile consumers are blurring the division between web browsers and apps, making mobile search behavior less comparable to its desktop/laptop counterpart, says Cathy Boyle, senior analyst for mobile at eMarketer. As a result, the market for mobile search advertising continues to fragment, she says.

“Even though browser-based search is a common behavior among mobile device owners, search engines are not necessarily the first place smartphone and tablet users turn,” Boyle says. “The explosion of mobile app development and usage means mobile users have more—and more specialized—alternatives for finding information.”

For example, this year, Google accounts for 65.7% of mobile search ad spending, YP (the Yellow Pages) 5.7%, Yelp 1.3%, and other venues such as, Yahoo, Bing and wireless carrier portals 27.3%, eMarketer says.

“Other” includes search mainstays like Yahoo and Bing, which eMarketer says have material mobile search revenues that the companies have yet to break out in earnings statements to provide a basis for reference. “Other” also includes niche service providers such as travel apps like Kayak, job search apps like Indeed, e-commerce apps like Amazon.com and contextual search apps like Shazam, all of which charge advertisers for search listings and are beginning to see gains in their mobile advertising revenue, eMarketer says.

“App-based searching is a new phenomenon that pales in comparison with the longstanding practice of querying a search engine, and the degree to which mobile users rely on both methods for finding information is unclear,” Boyle adds. “Still, in light of the growing popularity and time spent with apps, search marketers that recognize this behavior and focus on increasing visibility within apps aligned to their industry and business objectives will be best positioned to connect with the largest number of mobile users.”

Topics:

Cathy Boyle, eMarketer, Google, m-commerce, mobile commerce, Mobile marketing, mobile paid search, paid search, search engine marketing, Yelp

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