Facebook’s product is important because email is the most cost-effective marketing channel that online retailers use.
Spending on image-based product ads increased 69% year over year in Q1 2014 while text-based ad spending increased just 6%. And clicks followed suit.
Driving the continued growth in paid search spending in the first quarter of 2014 were image-based ads, offered by both Google Inc. and Microsoft Corp.’s Bing, says digital marketing agency Rimm-Kaufman Group. During the first quarter, RKG says spending on those ads that show product images and prices increased 69% year over year, while spending on text-based ads increased just 6%. Clicks followed suit: Clicks for ads with images were up 51% year over year, while clicks for text-based ads were up just 4%.
Google calls the ads with images Product Listing Ads; Bing calls them Bing Product Ads. RKG analyzed Q1 paid search data from its clients worldwide, which include retailers.
Among RKG’s retail clients, Product Listing Ads generated 29% of total paid search clicks on Google in the first quarter. In addition, these ads generated 50% of non-brand search clicks, that is, clicks prompted by search terms that do not include the name of a company or brand. The share of non-brand traffic generated by these ads varied depending on retail categories: Apparel retailers generated 32% of their Google traffic from Product Listings Ads, while consumer electronics retailers generated 58%.
While Bing was able to wrestle away some of Google’s paid search market share in late 2012 and early 2013, Google prevented further inroads in the first quarter of this year, according to the report. Google’s share of ad spending rose a tenth of a point in Q1 to 83%, and its share of paid search clicks rose eight-tenths of a point to 82%.
On all search engines, paid search spending increased 17% year over year in Q1, while total paid clicks increased 11%. Mobile paid search clicks also continue to swell, with mobile now constituting 36% of all paid clicks—split evenly between smartphones and tablets—and 27% of total paid search spending, the report says. At the same time, smartphone clicks increased 64% and tablet clicks increased 56%. Desktop clicks decreased by 3%.
Another recent report, by search marketing agency Covario Inc., estimates mobile’s share of total paid search spend at 25%.