Google has just released its earnings reports for Q3, and it’s interesting to see how the business has changed in recent months. The earnings highlight that the search engine is doing very well, in general, and that the mobile search business is particularly strong.
In May, Google confirmed that mobile search traffic had exceeded desktop search traffic in ten of the countries that it serves, and it seems that this growth is not slowing down, given the latest results.
Paid clicks have increased by 23% over the last year, while CPC has fallen by 11 percent over the same period. Paid search ad spends have been driven primarily by smartphone investment, with the spend having increased by 66% year on year.
CTRs are Improving
Interestingly enough, click growth has outpaced impression growth – across all devices. While Google doesn’t specify, it is likely that it is smartphones which are driving the growth in clicks, because consumers are becoming more active and are more willing to click on ads these days on a phone than they were back when data was more limited.
Marketers are also getting better at targeting specific devices, which means that they can improve the entire user experience, from the advertisement being shown to the end of the conversion process.
Google has added an extra ad slot on mobile devices, which means that there are more opportunities for engagement – and more opportunities for revenue too.
Currency Fluctuations
Another thing that is affecting the paid search market is currencies. CPCs have fallen, but it is important to remember that costs are shown in the contact currency, and are always adjusted to take into account market fluctuations. In addition, mobile cost per click tends to be lower than desktop, and this will, of course, mean that when the total CPC is worked out, if there are more mobile clicks then the aggregate cost will be lower.
New entries into the paid search space are more likely to spend money on mobile, while a longer-standing advertiser might be slower to move over. So Google is attracting new customers – wooed by the immediacy of mobile and the low cost, as well as the option of things like Search Ads for Google Play, and the Universal App Campaign.
Google is attempting to compete with Facebook, as well as being a simple search platform, and this latest update suggests that it is well on the way to achieving that.
