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Mobile Paid Search Data: iPhone Dominant, Android Rising

A little over a year ago we took a look at the impact of mobile web browsing on our clients' paid search campaigns and found that the traffic was too small to devote much time towards optimizing it. Well, a lot has happened in the mobile space in the past year:  Apple sold another 20 million or so iPhones worldwide, Motorola and Verizon launched a $100 million marketing campaign for the Droid, AT&T claimed a nearly 7000% increase in data use over the last few years and Google finally debuted its self-branded Nexus One.  It's a good time to revisit our numbers. As we did previously, we are looking at click traffic from mobile devices with full internet browsers that trigger standard PPC ads.  In December of '08 we found just 0.4% of PPC clicks came from mobile users.  By October of '09 that figure had already jumped to nearly 1.3%.  (Although it's dwarfed by Google, it was around this time that Yahoo began showing its full search ads on iPhone-like devices.) In early January of this year, mobile's share of PPC clicks is approaching 1.8%: Mobile PPC Share Traffic from devices running the Android OS has increased the most dramatically in recent months, with Android's share of mobile PPC clicks rising from 6.3% in October to 10.5% this January.   Android's quick rise corresponds with Motorola's Droid launch as well as the launches of a slew of less-heralded Android devices late last year. Share of Mobile PPC Traffic for Select Devices: At the same time, iPhone's mobile paid search traffic share (including iPod Touch) has been dominant, but somewhat flat, while Blackberry is down significantly.  It will be interesting to see if the Google Nexus One launch gives Android another big bump despite the reports of anemic first week sales. So, we have this big increase in mobile traffic, it must be a boon to advertisers, right?  Unfortunately, it doesn't look that way.  Conversion rates are very poor compared to traffic from desktop/laptop computers.   There are a couple of ways to think about the low conversion rates:
  • Conversion Rates are Better than they Appear
    1. Cookie breakage as people browse on their mobile devices, but purchase on their home or work computers.
    2. On some devices, there's also more likely to be technical issues with tracking cookies or scripts that we don't face on full PCs or Macs.
    3. People click on the ad, find the store nearest them and purchase in person.
  • Conversion Rates Really are Awful
    1. Shopping on a tiny screen with two-thumb typing may be too much of a barrier for folks to overcome.
    2. People click on your ad and walk into someone else's store to make the purchase.
    3. People are in someone else's store want to compare prices online and click on your ad to show the clerk and get the benefit of the store's price-matching policy.
If the advertiser doesn't have brick and mortar stores, there's a pretty good reason to be biased towards the negative assumptions. If you're in that camp, it makes sense now for advertisers to parse out a duplicate campaign of top Google keywords to display on mobile devices while using the opt out option for existing campaigns.  The mobile campaign can be bid based on its own performance without diluting the results of the core program. Mobile search growth is unlikely to slow anytime soon, while the lines between devices will continue to blur as more and more gadgets incorporate full web browsing functionality.  Google is clearly anticipating this as it pushes to get Android, with its close integration of Google services, on as many devices as possible.  Whether user behavior and our ability to track it begins to match what we see on traditional computers anytime soon is still an open question.
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