March 28, 2012, 9:56 AM

Tiny ads generate big revenue for Google

And U.K. consumers significantly interact with mobile ads, studies find.

Katie Evans

Managing Editor, International Research

Lead Photo

Google’s U.S. mobile ad revenue is growing four to eight times faster than its desktop revenue, a new report from advertising management firm Marin Software finds. Meanwhile another study from Marin reports the U.K. is leading the way in mobile paid search activity in Europe.  Both studies are based on $3.5 billion worth of search spend managed via Marin throughout 2011. Marin has approximately 1,500 clients.

Paid search clicks from mobile devices in the U.S. on Google increased 132% between January and December 2011, Marin says. And by the end of 2012, 25% of all U.S. paid-search clicks on Google will stem from mobile devices, Marin forecasts, up from 5% in 2011.

Those figures aren’t surprising when one considers a recent Marin analysis that found smartphone-based paid search ads in the U.S. register 72% higher click-through rates than PC-based ads; tablets 31% higher.

All of this means Google stands to rake in a lot of mobile ad revenue in the coming year, Marin says. It estimates that large U.S. advertisers will more than double their mobile search budgets in 2012. “The popularity of mobile devices coupled with their ad performance will result in a surge of new ad dollars for Google in 2012,” Marin says in its report.

Looking beyond mobile behavior in the U.S. and into Europe, Marin finds that U.K. consumers engage the most with mobile paid search ads. U.K. paid search clicks stemming from mobile devices rose 179.6% in 2011, from 5.4% in January to 15.1% in December.

What’s more, Marin finds that the cost-per-click for mobile paid search in the U.K. is cheaper than desktop. Average cost per click is 48 cents for a PC-based ad, 26 cents for a smartphone-based ad and 35 cents for a tablet-based ad. Google, for example, enables clients to target specially sized ads to different devices.

U.K. advertisers are increasing their mobile search budgets, Marin reports. In 2011 average mobile paid search budgets in the region grew by 191%, from 3.2% of total search budgets to 9.3%.

Beyond the U.K., the 27 countries that make up the Eurozone—countries that use the euro as currency—showed strong growth in mobile paid search use in 2011 with mobile clicks in the region growing 177% from 2.1% of all paid search clicks in January 2011 to 5.8% in December of last year.

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