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RKG Digital Marketing Report: Q2 2013 Released

We are happy to announce the release of the latest RKG Digital Marketing Report featuring our analysis of second quarter trends in 2013.  Our full report offers over 40 charts covering paid and organic search, social media, comparison shopping engines, multi-channel attribution and more. (Click Here to Download the RKG Q2 2013 DMR) In the paid search industry, Google's Enhanced Campaigns have been top of mind for many, with the mandatory transition to the new model less than two weeks away.  While RKG data shows Google having another strong quarter with spending up 18% Y/Y in Q2, the performance impacts of Enhanced Campaigns have been minor to date for larger advertisers.
While smartphone CPCs accelerated from 55% of desktop levels to 60% as more advertisers transitioned to Google Enhanced Campaigns, the impact to total CPC growth was negligible.
Smartphone traffic continues to be a net drag on total cost-per-click growth, with average click costs 40% lower than desktop, however, mobile is still providing a large lift to total paid search click and spending growth.  While desktop and laptop clicks were down 7% year over year in Q2, smartphone clicks rose 179% and tablet clicks rose 115%.

Bing Ads Spending Growth Double That for Google

Although it doesn't receive the same attention as its larger rival in the search ads space, Bing Ads has been delivering huge traffic gains for several quarters in a row now.  In Q2, RKG found spending on Bing and Yahoo up 58% Y/Y, driven primarily by a 41% increase in clicks.

Importantly, Bing has been able to deliver those traffic gains without sacrificing traffic quality, as non-brand ROI was flat Y/Y.  It appears that Microsoft's engineers have solved the broad match problems RKG first pointed out two years ago, as Bing Ads is now exhibiting significantly higher broad matching than Google:

Marketers Facing Challenges Assessing Organic Search Performance

Obscured, missing or incorrect organic search data remains a growing impediment for SEO analysis, but we have done our best to accurately estimate the true trends for organic search.  In the second quarter, an estimated 14.3% of Google organic searches were hidden on average in popular analytics packages due to iOS 6 failing to pass a referring URL:

As a result, the share of iOS direct traffic visits remains inflated while organic search visits are underreported:

Additional Highlights From This Quarter's Report

  • Google paid search spending growth decelerated slightly to 18% Y/Y.  After nearly unprecedented CPC declines and click growth in 2012, advertisers are seeing a reversal with CPCs up 10% in Q2 2013 and clicks up 7%.
  • Bing Ads search costs rose 58% Y/Y in Q2, the third quarter in a row where its growth rate more than doubled that of Google.  Bing’s growth has been driven by a surge in non-brand clicks, which rose 49%, while ROI has remained stable.

  • Tablets and smartphones drove 28% of paid clicks and combined for 22% of spend.  With desktop and laptop clicks down 7% year over year, 178% growth for smartphones and 115% growth for tablets drove total clicks up 12%.

  • Tablets generated an average revenue per click that was 8% lower than that for desktops and laptops, while smartphone RPC was 78% lower.
  • Google Product Listing Ads generated 33% of paid search clicks in Q2 at CPCs that were an average 10% lower than non-brand text ads.  PLAs continue to be a large growth driver in the retail space with some sites seeing 50-60% of their Google spend going to the format.

  • Across all engines, 26% of organic search visits took place on tablets and smartphones.  On both Google and Yahoo, nearly 28% of visits were mobile, while Bing’s mobile share trailed at 13%.
  • iOS devices accounted for an estimated 18% of organic search visits.  Android devices generated 7%, while all other mobile devices accounted for a little less than 1%.
  • Facebook’s share of social referrals to sites was 58% in Q2, far ahead of other players in the space.

  • Despite concerns about its new $4 minimum bid policy, Shopzilla CPCs were down slightly.  Across other engines, CPCs were also flat to down from quarter to quarter.
If you haven't already, check out our full report here.
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