kenshoo global search advertising trends q1 2013

7/30/2019 Kenshoo Global Search Advertising Trends q1 2013

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GLOBAL SEARCHADVERTISING TRENDS

Updated through Q1 2013Published: April 23, 2013

2013, Kenshoo, Inc. | CO-04-1005-EN


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Table of Contents

Overview ............................................................................................................................................................................. 3

Global Paid Search Ad Spend and Campaign Metrics ............................................................................................... 4

Global Paid Search Budgets Continue to Show Year-over-Year Growth ..........................................................................4

Average Cost-per-Click Down Slightly but Still Near 2012 Levels ......................................................................................5

Signicant Growth Year-over-Year in Both Clicks and Click-through-Rate .......................................................................6

Regional Search Ad Spend xand Cost-per-Click ......................................................................................................... 8

U.S. Paid Search Budgets up Year-over-Year with E.U. Relatively Flat and U.K. Down ..................................................8

U.S. Mobile Device Breakdown....................................................................................................................................... 11

Mobile Devices Account or 19% o All U.S. Paid Search Clicks but Just 14% o Spend ...............................................11

U.S. Mobile Device CPCs Provide Price Discounts Relative to Computers but Tablets are Closing the Gap ........12

U.K. Mobile Device Breakdown ...................................................................................................................................... 13

Mobile Devices Account or 28% o U.K. Paid Search Clicks ..............................................................................................13

U.K. Tablet CPCs Comparable to Computer ............................................................................................................................14

Summary Infographic........................................................................................................................................................ 15

Methodology ...................................................................................................................................................................... 16

About Kenshoo................................................................................................................................................................... 17

Contact ................................................................................................................................................................................ 17

CO-04-1005-EN Kenshoo, Inc. 2013 2


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Overview

Kenshoo Global Search Advertising Trends is a quarterly report reecting aggregate data rom campaigns managed through Kenshoo.

Approximately $3 billion dollars in annual online advertising budgets are managed through Kenshoo by the most sophisticated

advertisers and agencies in the world.

Kenshoo was recently named the sole Leader in bid management sotware ater an evaluation by independent rm, Forrester

Research, Inc.

Kenshoo clients include nearly hal o the Fortune 50 companies and all 10 top global ad agency networks.

This report ocuses on paid search trends segmented by the ollowing categories:

Key Campaign Metrics

Geographic Regions

Mobile Devices



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Global Paid Search Ad Spendand Campaign Metrics

Global Paid Search Budgets Continue to Show Year-over-Year Growth

Q1 had a predictable quarter-over-quarter (QoQ) drop in global paid search ad spend as Q4 generates a seasonal budget surge.

The 16% QoQ reduction is similar to the 14% drop we saw in Q1 o 2012.

Year-over-year (YoY) Q1 ad spend was up 15% showing 2013 is of to a good start ater a strong nish in 2012. Overall, last year,

search ad budgets increased 32% in 2012 versus 2011.

Global Search

Advertising Spend

Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013

Quarter-over-Quarter

(QoQ) Delta25% 35% -14% 5% 5% 25% -16%

Source: Kenshoo Search Advertising Trends, Kenshoo, Inc. 2013

Global Search

Advertising SpendQ2 2012 Q3 2012 Q4 2012 Q1 2013

Year-over-Year (YoY) Delta 52% 28% 18% 15%

Source: Kenshoo Search Advertising Trends, Kenshoo, Inc. 2013

Quarterly Global Search Advertising Spend Volume

Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013

1.00 1.05

1.101.15

1.38

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60

Source: Kenshoo Global Search Advertising Trends, Kenshoo, Inc. 2013

Note: Volume metrics have been normalized to a factor of 1 based on the initial quarter of data. Data points from subsequent quarters are based on a

multiplier from the first quarter for example, 1.15 means that volume is 15% greater than volume in initial quarter measured (Q1 2012).



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Average Cost-per-Click Down Slightly but Still Near 2012 Levels

At $0.39, the global average paid search cost-per-click (CPC) in Q1 was the lowest it has been in ve quarters. However, the CPC

is on par with the $0.41 CPC we saw in Q1 o 2012.


Quarterly Global Search Advertising Cost-per-click Rates

Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013

$0.34

$0.36

$0.38

$0.40

$0.42

$0.44

$0.46

$0.48

$0.41

$0.44

$0.46

$0.45

$0.39



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Quarterly Global Search Advertising Click-through Rates

Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013

0.00%

0.50%

1.00%

1.50%

2.00%

1.04%1.12%

1.31%

1.63%1.68%

Signifcant Growth Year-over-Year in Both Clicks and Click-through-Rate

Q1 total click volume was up 21% over the same period in 2012. Click-through-rate (CTR) also improved rom 1.04% in Q1 2012

to 1.68% in Q1 2013 a dramatic YoY increase o 62%.

Even though spend, clicks, and CTR have been trending upwards over the last ve quarters, total impression volume has been

declining steadily during the same period and was 26% lower YoY in Q1.

Quarterly Global Search Advertising Click Volume

Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013

1.00 0.97 0.98

1.25 1.21

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40



multiplier from the first quarter for example, 1.21 means that volume is 21% greater than volume in initial quarter measured (Q1 2012).



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multiplier from the first quarter for example, 0.74 means that volume is 26% less than volume in initial quarter measured (Q1 2012).

Quarterly Global Search Advertising Impression Volume

Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013

1.000.90

0.77 0.800.74

0.00

0.20

0.40

0.60

0.80

1.00

1.20



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Regional Search Ad Spendand Cost-per-Click

U.S. Paid Search Budgets up Year-over-Year with E.U. Relatively Flat and U.K. Down

In the U.S. and the U.K., ad spend was predictably down QoQ ollowing the strong Q4 shopping season. However, whereas U.S.

Q1 spend ollowed the global trend o YoY growth (24%), ad spend in the U.K. dropped by 11% in Q1 compared to the same quarter

in 2012. In the E.U., Q1 budgets actually rose by 4% QoQ but were down 4% YoY.

Average CPC in the U.S. and U.K. dipped slightly in Q1 and the U.K. remained higher than the U.S. at $0.44 and $0.38 USD

respectively. CPC or continental Europe has been relatively at or the last ve quarters and stood at $0.36 in Q1.


Note: Volume metrics have been normalized to a factor of 1 based on the initial quarter of data. Data points from subsequent quarters are based

on a multiplier from the first quarter for example, 1.24 means that volume is 24% greater than volume in initial quarter measured (Q1 2012).

Quarterly U.S. Search Advertising Spend Volume

Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013

1.00

1.071.17

1.51

1.24

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60



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Quarterly U.K. Search Advertising Spend Volume

Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013


Note: Volume metrics have been normalized to a factor of 1 based on the initial quarter of data. Data points from subsequent quarters are based

on a multiplier from the first quarter for example, 0.89 means that volume is 11% less than volume in initial quarter measured (Q1 2012).

1.00 0.93 0.97

1.18

0.89

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60


Notes: U.K. excluded from EU data set. Volume metrics have been normalized to a factor of 1 based on the initial quarter of data. Data points from subsequent

quarters are based on a multiplier from the first quarter for example, 0.96 means that volume is 4% less than volume in initial quarter measured (Q1 2012).

Quarterly E.U. Search Advertising Spend Volume

Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60

1.00 1.02 0.96 0.92 0.96



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Quarterly Regional Average Cost-per-click (USD)

Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013

$0.25

$0.30

$0.35

$0.40

$0.45

$0.50

$0.38

$0.44

$0.36

U.S.

U.K.

E.U.



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U.S. Mobile Device Breakdown

Mobile Devices Account or 19% o All U.S. Paid Search Clicks but Just 14% o Spend

Mobile devices continue to play a prominent role in U.S. consumer search and SEM. While the computer and tablet click-to-spend

ratio is airly even, phone spend lags signicantly behind phone click volume with 8.7% o total paid search clicks but only

accounting or 5% o total spend.


Q1 2013 U.S. Search Advertising Spend and Clicks by Device

Clicks Ad Spend

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

Computer

Phone

Tablet

81.2%

8.7%

10.1%

86.1%

5.0%8.9%



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U.S. Mobile Device CPCs Provide Price Discounts Relative to Computers but Tablets are

Closing the Gap

Mobile device CPCs in the U.S. are discounted compared to computers with phone clicks being 46% less expensive and tablets

being 18% lower than computers. At $0.46 per click, tablets are just $0.10 behind computer CPCs and 53% more expensive than

phone clicks.


Q1 2013 U.S. Search Advertising Cost-per-Click by Device (USD)

$0.56

$0.30

$0.46

$-

$0.10

$0.20

$0.30

$0.40

$0.50

$0.60

Computer Phone Tablet

CPC



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U.K. Mobile Device Breakdown

Mobile Devices Account or 28% o U.K. Paid Search Clicks

When it comes to mobile search in the U.K., phones and tablets represent 28% o all paid clicks and roughly 25% o ad spend.

While computer and tablet spend share is very aligned with their share o clicks, phones lag behind with 11.5% o total clicks, yet

only 7.8% o total spend.


Q1 2013 U.K. Search Advertising Spend and Clicks by Device

72.3%75.5%

11.5%7.8%

16.3% 16.7%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

Clicks Ad Spend

Computer

Phone

Tablet



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U.K. Tablet CPCs Comparable to ComputerTablet CPCs in the U.K. are now equal to computer CPC prices at 0.30. Phones CPCs lag behind both computers and tablets at

0.20, which is 33% lower than the bigger screens.


Q1 2013 U.K. Search Advertising Cost-per-Click by Device (GBP)

0.30

0.20

0.30

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

Computer Phone Tablet

CPC (GBP)



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Summary InfographicGlobal Search Advertising

Trends - Q1 2013

Global Search Ad Spend Up

Global Click-through Rates Up

62%Year-over-Year

15%

Year-over-Year

Mobile Devices Steal the Screens but Not the Wallets

Clicks Ad SpendClicks Ad SpendClicks Ad Spend

U.K. Cost-per-Click Exceeds U.S.

Average CPC byRegion (USD)

$0.38

$0.44

9% 5%10% 9%81% 86%

Clicks Ad Spend Clicks Ad Spend

12% 8%

Clicks Ad Spend

16% 17%72% 75%



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Methodology

To analyze quarterly data in its historical context through the most uniorm and largest sample possible, an aggregate data setwas built rom a representative sample o advertisers and agencies who had been active on the Kenshoo platorm during the

entire previous 24 months. Whenever possible, the initial 3 months o campaign data were excluded rom the index in an attempt

to reduce the impact o program launches and the associated anomalies they present as marketers set up their programs and

make initial tweaks.

The rolling data set used in this research reects billions o dollars in global paid search ad spend. While this sample better

reects changes over time in the overall marketplace, there may be variations in numbers or past or uture reports published by

Kenshoo, as the rolling data set is dynamic each new quarter.

All volume metrics have been normalized to a actor o 1 based on the initial quarter o data. Data points rom subsequent quarters

are based on a multiplier rom the rst quarter or example, 1.55 means that volume is 55% greater than volume in the initial

quarter measured.

Mobile device data comes rom a representative sample o Kenshoo clients in the U.S. and U.K. who were tracking device type,

conversions, and revenue metrics within the Kenshoo platorm during Q1 2013 or paid search activities. Mobile device data

comes rom a diferent sample o Kenshoo client data than the index data set used or global and regional analysis.



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About Kenshoo

Kenshoo is a digital marketing technology company that engineers premium solutions or search marketing, social media and

online advertising. Brands, agencies and developers use Kenshoo Enterprise, Kenshoo Social, Kenshoo Local and Kenshoo

SmartPath to direct more than $25 billion in annual client sales revenue. The Kenshoo platorm delivers Innite Optimization

through closed-loop targeting, universal integration, and dynamic attribution. Kenshoos adaptive technology, proven algorithms,

and unmatched scale power campaigns in more than 190 countries or nearly hal o the Fortune 50 and all 10 top global ad

agency networks. Kenshoo clients include CareerBuilder, Expedia, Facebook, KAYAK, Havas Digital, Hitwise, iREP, John Lewis,

Resolution Media, Sears, Starcom MediaVest Group, Tesco, Travelocity, Walgreens, and Zappos. Kenshoo has 16 international

locations and is backed by Sequoia Capital, Arts Alliance and Tenaya Capital. Please visit www.Kenshoo.com or more inormation.

Kenshoo brand and product names are trademarks of Kenshoo Ltd. Other company and brand names may be trademarks of

their respective owners.

Contact

Josh Dreller, Director o Marketing Research

[email protected]

http://www.kenshoo.com/http://www.kenshoo.com/mailto:Josh.Dreller%40Kenshoo.com?subject=Kenshoo%27s%20Q1%202013%20Global%20Search%20Ad%20Trend%20Reportmailto:Josh.Dreller%40Kenshoo.com?subject=Kenshoo%27s%20Q1%202013%20Global%20Search%20Ad%20Trend%20Reporthttp://www.kenshoo.com/http://www.kenshoo.com/

kenshoo global search advertising trends q1 2013

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