New Kenshoo Paid Search Marketing Report Shows Overall Q3 Global Growth, Regional Cost-per-Click Inflation and Wins for the Yahoo! Bing Network, Google Product Listing Ads and Mobile Devices

SAN FRANCISCO, Oct. 12, 2012 /PRNewswire/ --

Kenshoo Global Search Advertising Trends report is the first in an ongoing, quarterly series

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Kenshoo, a global leader in digital marketing software, today published its inaugural quarterly report, "Kenshoo Global Search Advertising Trends." The report examines the performance of paid search ads by analyzing aggregate campaign data across search engines including Google, Yahoo!, Bing, Baidu, and Yahoo! Japan based on more than $3 billion in annual paid search budgets managed through Kenshoo. Notable findings from the report include:

Global Search Advertising Growing

Through the first three quarters of 2012, global paid search budgets were significantly higher year-over-year (YoY). For Q3 2012, the YoY growth rate was 24 percent. The increase in global search ad spend comes despite average cost-per-click (CPC) being relatively flat YoY, reflecting incremental budgets being allocated to paid search.

U.S., U.K., and E.U. Paid Search Average Cost-per-Click Rising

During 2012, both the U.S. and U.K., as well as the broader European Union, have shown steady CPC increases quarter-over-quarter (QoQ). If growth rates remain consistent, CPC rates in the U.K., which are currently at $0.45 USD, could match the U.S. CPC rate of $0.48 by Q4 2012. With CPC rising, marketers will have to increase search ad budgets and/or develop sophisticated optimization strategies to sustain traffic and conversion volumes.

Yahoo! Bing Network Drives Strong Results

In the U.S., while Google delivers more overall traffic (684 percent more in Q3 2012), the Yahoo! Bing Network (YBN) drives online sales revenue at a more efficient rate. Specifically, the return on ad spend (ROAS) of paid search on YBN was 28 percent higher in Q3 than that of Google and the YBN click-through rate (CTR) was 29 percent higher. As a result, advertisers increased their YBN ad spend 10 percent quarter-over-quarter and 35 percent YoY, representing a faster rate of growth than Google.

Google Product Listing Ads Outperform Text Ads

Google Product Listing Ads (PLA) have gained significant traction and outperformed paid search text ads in CTR (68 percent higher), conversion rate (38 percent higher) and ROAS (25 percent higher). Google Shopping moves to an all paid model in the U.S. on October 17, 2012, with the U.K. and Europe expected to follow in 2013.  This means only merchants who leverage PLA will be present in the search results, making these findings especially notable.  

Mobile Ads Having an Impact

Representing 13 percent of total U.S. paid search spend, mobile phones and tablets generated 21 percent of all U.S. search advertising clicks. While mobile phones accounted for 11 percent of all search ad clicks and six percent of all spend, these devices returned just 0.6 percent of all conversions. Meanwhile, tablets generated 8.8 percent of all conversions and 10 percent of total clicks while accounting for only seven percent of total ad spend. These converging trends illustrate the impressive performance of tablet paid search for top advertisers, as well as a move toward differentiating paid search campaigns on mobile phones to better accommodate mobile searchers and achieve complementary conversions that aim for something other than direct online sales.

"Through the first three quarters of 2012, we've seen strong growth in paid search budgets as advertisers continue to generate exceptional results from this intent-driven marketing channel," said Aaron Goldman, CMO of Kenshoo. "Marketers should closely examine our data as well as their own campaign benchmarks to find the best performing areas and those ripe for expansion to meet their goals. This report identifies a number of specific opportunities, including increasing investment with the Yahoo! Bing Network, ramping up Product Listing Ads for Google Shopping, and creating mobile campaigns with unique targeting for different devices.

To analyze quarterly data in its historical context through the most uniform and largest sample possible, an aggregate data set was built from Kenshoo clients who had been active during the previous 18 months. Kenshoo clients include four of the top five U.S. travel websites, six of the top 10 global hotel chains, seven of the top 10 global retailers, eight of the top 10 global telecoms, 10 of the top 10 global ad agency networks and 24 of the Fortune 50 companies.

Visit http://www.Kenshoo.com/GlobalSearchAdvertisingTrends to download the full report, including key takeaways for marketers.

About Kenshoo

Kenshoo is a digital marketing software company that engineers technology solutions for search marketing, social media and online advertising. Brands, agencies and marketing providers use Kenshoo Enterprise, Kenshoo Local and Kenshoo Social to direct more than $25 billion in annual client sales revenue. The Kenshoo Universal Platform delivers automation, intelligence, integration and scale to make better marketing investments. With campaigns running in more than 190 countries, Kenshoo clients include CareerBuilder, Expedia, Facebook, KAYAK, Havas Digital, Hitwise, iREP, John Lewis, LendingTree, Resolution Media, Sears, Starcom MediaVest Group, Tesco, Travelocity, Walgreens, and Zappos. Kenshoo has 16 international locations and is backed by Sequoia Capital and Arts Alliance. Please visit http://www.Kenshoo.com for more information.

Kenshoo is a trademark of Kenshoo Ltd. Other company and brand names may be trademarks of their respective owners.