IgnitionOne: Mobile PPC Spend Sees Triple-Digit Growth, Retailer Spend Jumps 18% In Q2

Paid search spend in the US increased 7 percent year-over-year in Q2 2013, according to IgnitionOne’s latest Digital Marketing�Report. That’s up from a 2 percent YoY increase seen in Q1, though IgnitionOne found that total search spend fell quarter-over-quarter. Clicks and impressions both rose 5 percent, and CPCs ticked up 2 percent YoY.

The retailer category stood out in terms of growth in Q2, both compared to the previous year and to Q1. Impressions rose 24 percent, and paid search spending jumped 18 percent year-over-year. IgnitionOne says Google Product Listing Ads (PLAs) are driving the growth in spend in the retailer vertical.

Not surprisingly, mobile search advertising continues to grow. Spend, clicks and impressions were all up, with smartphone spend up 106% and tablet spend rising 116%. Tablets claimed 59 percent share of mobile search spend in Q2.

Seeing The Impact Of Enhanced Campaigns

While smartphone CPCs fell 13% overall, IgnitionOne says enhanced campaigns are pushing mobile CPCs for position one — the key spot on smartphone results — way up. When asked about this, IgnitionOne President, Roger Barnette, said in a statement, that CPCs are skyrocketing for the top spot of smartphone ads “for the very narrow selection of our marketers who have migrated to Enhanced Campaigns.”

Among the small set of IgnitionOne’s client set that had migrated to enhanced campaigns in Q2, the company did see increases in both cost and CPCs. The company concludes, “Presumably, this is driven by two main factors: an�increase in competition in the mobile (smartphone) and tablet space as well as a loss of granular/keyword�level control of the mobile and tablet channels. This increase in competition comes from forcing more�advertisers into mobile and tablet.”

IgnitionOne is seeing the increased competition forcing advertisers to raise their budgets to maintain their previous levels of traffic share. As many advertisers can’t raise budgets, IgnitionOne says they are seeing “a decline in both clicks and click-through-rate as pre-GEC advertisers are forced to share the traffic with newcomers…. Marketers are paying more for previously cheaper traffic, and therefore can afford less.”

The company anticipates they’ll continue to see these effects through the full migration to enhanced campaigns.