April 15, 2014, Charlottesville, VA – RKG, a leading full-service digital marketing agency, released its Digital Marketing Report today, covering the first quarter of 2014. By analyzing data across its client base, which includes over 40 of the IR Top 500 Retailers, RKG’s report provides insight into trends for search, SEO, product listing ads, display advertising, social media, comparison shopping engines, and more.
The first quarter of 2014 saw continued growth across channels, as total paid search spend increased 17% from last year and organic search share stayed relatively constant. Mobile devices played a notable role in growth trends, while Product Listing Ads (PLAs) continue to drive paid search growth.
Mobiles Devices Now Account for One-Third of Search Traffic
While desktop visits for organic search are declining, mobile clicks in Q1 grew by 29% over this time last year. Mobile accounts for 33% of organic traffic on Google and 36% on Yahoo. And while mobile clicks contributed to just 16% of Bing organic traffic, this figure doubled from Q1 of 2013.
Paid search data shows similar trends. Smartphones and tablets each account for 18% of paid clicks, together contributing over a third of all search traffic. Comparing this quarter’s data to Q1 of last year, we see that smartphone clicks increased by 64%, while tablet clicks increased by 56%. Meanwhile, desktop traffic declined by 3% compared to this time last year.
Product Ads Now 50% of Non-Brand Google Search; Growing on Bing
Image-based product ads, including Google’s Product Listing Ads (PLAs) and Bing’s Product Ads, are greatly outpacing text ad growth in terms of both traffic and ad spend. While text ad spending rose by just 6% year-over-year on a 4% increase in clicks, product ads saw a 69% increase in ad spend and a 51% increase in click traffic from Q1 of 2013.
PLAs on Google recorded a 14% stronger ROI than text ads in Q1. While CPCs averaged 8% higher than text ads, conversion rates were 50% higher for the RKG client base, making PLAs attractive to both Google and advertisers. As a result, Google gave PLAs greater prominence in search rankings this quarter, resulting in further traffic gains. PLAs now account for 29% of all paid clicks on Google, and 50% of non-brand clicks.
Image-based product ads also made strides on Bing, whose product ad format came out of beta at the beginning of the quarter. Bing product ads accounted for 12% of non-brand revenue in Q1, compared to just 8% in Q4 of 2013. Even more promising, revenue per click (RPC) for Bing product ads is now 79% higher than comparable text ads, while in Q4 beta participants saw a RPC that was 22% lower than non-brand text ad levels.
Other Notable Q1 Highlights
- Google paid search spending grew 17% Y/Y in Q1, a small deceleration from 19% growth in Q4. Paid clicks were up 10%, while CPCs increased 6%.
- Using Google’s conversion tracking data and estimates, cross-device conversions amounted to 20% of smartphone conversions for sampled RKG clients, but just 7% of conversions across all device types.
Organic Search & Social
- Not Provided query share has remained stable since October of 2013 and now stands at an average of 85% of Google search visits.
- Facebook generated 54% of social media referrals in Q1. Pinterest has shown rapid growth, but with a wide range of influence from site to site.
- Mobile devices accounted for 37% of social media referrals in Q1, up from 22% a year earlier.
Comparing Shopping Engines
- For advertisers using both Amazon Product Ads and Google PLAs, Amazon Product Ads produced just 9% of the revenue volume seen for PLAs, down from 11% in Q4.
- PriceGrabber and the eBay Commerce Network both saw increases in spend year-over-year, while Shopzilla-Bizrate traffic decreased and Nextag’s share of CSE spend is now just 2%, down from 13% in Q1 of 2013.
- While revenue per click is nearly identical between Facebook Exchange (FBX) ads and other display ads, CPC remains 33% lower on Facebook, resulting in superior ROI.
For additional insights, download the RKG Digital Marketing Report. The full report provides detailed analyses, with over 50 charts illustrating trends in paid search, SEO, social media, product listing ads, comparison shopping engines, display advertising, attribution and more.
RKG is a search and digital marketing agency that combines superior marketing talent with leading-edge technology to create the industry’s most effective data-driven digital marketing solutions. RKG drives business to clients by maximizing a full range of opportunities including paid search, SEO, product listing ads, social media, display advertising and comparison shopping engine management services. Founded in 2003, RKG partners with clients such as Drugstore.com, Express, Herman Miller, Jones Group and Urban Outfitters. In 2013, Advertising Age ranked RKG the fastest growing search agency. A privately held company, RKG is headquartered in Charlottesville, VA with offices in San Francisco, CA, Bend, OR and Boston, MA. For more information visit www.rimmkaufman.com or follow the company on Twitter @rimmkaufman.