Search marketing agency Covario issued its fourth quarter Global Paid Search Spend Analysis, reporting that spending on pay-per-click advertising, or PPC, by its enterprise technology, consumer electronics and retail clients rose 15 percent over the same quarter in 2011 and 18 percent for the year as a whole.
Alex Funk, Covario’s director of performance media and the author of the report, said global paid search spending growth overall was generally in line with the firm’s 2012 forecast.
Paid search advertising on mobile devices continued to grow last year with mobile PPC spend increasing 30 percent in the fourth quarter year-over-year and 10 percent over the third quarter. In addition, cost-per-clicks, or CPCs, on tablets continue to exceed those on personal computers.
Keyword pricing evened out with CPCs up 3 percent for the year due to “an emerging mobile headwind” of lower priced keywords for smartphones, Funk said.
On a regional basis, the Americas saw 21 percent year-over-year growth in paid search spending in Q4.
While Asia/Pacific saw year-on-year growth of 13 percent, search spending there had a double-digit decline in Q4 versus Q3. Nevertheless, Funk sees the region as an area where “major opportunities exist for paid search.”
Paid search spend in Europe had just 10 percent fourth quarter growth versus the same period last year.
As far as search engines go, Google commanded more than 86 percent of the paid search market. Plus, advertiser increases in fourth quarter search spending with Google were up 13 percent from a year ago.
The Yahoo-Bing Network, with nearly 8 percent of global search market share, saw quarterly PPC spending up 23 percent year-over-year, Covario found.
Baidu, which has market share as high as 80 percent in China, saw media spend grow by 52 percent for the year.
Looking forward, Funk recommends advertisers budget for an increase of 18 to 20 percent in paid search spending in the Americas with an emphasis on Latin America as the region’s largest growth opportunity. In Asia/Pacific, he suggests advertisers plan for incremental PPC spending of 30 to 40 percent. However, in Europe, Funk recommends just a 10 percent budget increase.
In mobile, ad spend in 2012 was split between 36 percent for smartphones and 64 percent for tablets, Covario found.
“This gap continues to widen as we see higher purchase affinity for those users who are search on a tablet device,” Funk said in a prepared statement. “Due to the growth in tablet ownership, this split has nearly flip-flopped from a year ago when smartphones made up 56 percent of the mobile portion of ad spend.”
This is the sixth year the firm has produced its Global Paid Search Spend Analysis. It encompasses 24 quarters of data on the PPC spending patterns of global technology and consumer electronics search marketing clients, in addition to national retailers.
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