Google Claims Nearly 80% of U.S. Search Advertising Spend in Q2 2012

By Jason Hahn | DM Confidential | July 4, 2012

IgnitionOne recently released its “Online Advertising Report: Q2 2012.” Among the findings was that search spend in the second quarter of 2012 slowed down from the growth observed in the first quarter of the year. Also, Google claimed for nearly $8 out of every $10 spent on U.S. search advertising in the second quarter.

In the second quarter, paid search spending grew 15.5 percent year-over-year, slower than the 30.3 percent growth seen in the first quarter and the 22.4 percent growth in the fourth quarter of 2011.

According to IgnitionOne, clicks were up 13.2 percent year-over-year in the second quarter, also slower than the 29.1 percent increase seen in the previous quarter.

Total cost-per-click (CPC) was up 2.1 percent year-over-year, with Google’s CPC down 3.1 percent. “This continued decrease can be blamed on increasing reliance on mobile, which has cheaper CPCs as well as increasing use of new ad formats which are generally lower PPC clicks,” according to the report.

Bing/Yahoo, on the other hand, saw its CPC surge 24.3 percent, about the same as its increase in the previous quarter. IgnitionOne attributes this to the alliance’s promotion of best practices, “which led to greater competition in auctions through the increased use of broad match keywords as a stepping stone for exposure across other match types.”

In the second quarter, Google held 79.1 percent of U.S. search engine ad spend, while Bing/Yahoo claimed 20.9 percent. Google grew its share of search ad spend by 11.4 percent year-over-year, while Bing/Yahoo increased its spend by 32.9 percent year-over-year.

Spending on mobile search ads is up 333 percent year-over-year, according to IgnitionOne. Impressions are up 130 percent and clicks are up 325 percent.

According to the report, mobile search claimed 14 percent of total search advertising spend in the second quarter, a 12.3 percent increase from the previous quarter. Tablets accounted for 60 percent of mobile search advertising spend in the second quarter, while mobile phones accounted for the other 40 percent.

IgnitionOne pointed out that travel search advertising spend grew 37.8 percent year-over-year, compared to its 22.8 percent growth in the first quarter. Impressions grew 61.9 percent year-over-year, a notable rise from the 34.3 percent growth in the previous quarter.

The report also shared an estimate that Facebook’s real-time bidding advertising platform will drive an incremental 12-15 percent in retargeting budgets and drive overall display spend higher.

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