Rkg Digital Marketing Report Q1 2014
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Transcript of Rkg Digital Marketing Report Q1 2014
Q1 2014
04 PAID SEARCH
03 ExECutIvE SummARy
14 ORGANIC SEARCH & SOCIAL
19 COmPARISON SHOPPING ENGINES
22 DISPLAy ADvERtISING
25 muLtI-CHANNEL
27 ABOut RKG & mEtHODOLOGy
tABLE OF CONtENtS
3
PAID SEARCH
• Googlepaidsearchspendinggrew17%Y/YinQ1,asmalldecelerationfrom19%growthinQ4.Paidclickswereup10%,whileCPCsincreased6%.
• PaidsearchspendingonBingAds,whichincludesBingandYahoo,alsogrew17%Y/Y.Paidclicksrose16%,whileCPCswerejust1%higher.
• Among retailers, Product ListingAds (PLAs)generated29%of totalGooglepaid search clicks in thequarterandnearlyhalfofnon-brandGooglepaidsearchclicks.ROIforPLAswas14%betterthanthatforcomparabletextads.
• BingProductAdsshowed improvement inQ1andcontributed12%ofparticipatingadvertisers’non-brandrevenuefromBingAds.
• Mobilegenerated36%ofpaidsearchclicks,withthatfiguresplitfairlyevenlybetweensmartphonesandtablets.Smartphonesaccountedforjust7%ofspendthough,comparedto20%fortablets.
• AccordingtoGoogle’sconversiontrackingdataandestimates,cross-deviceconversionsamountto20%ofconversionsthatGoogleattributestosmartphonesforRKGclients,butjust7%ofconversionsacrossalldevicetypes.
ORGANIC SEARCH & SOCIAL
• Organicsearchproduced30%ofsitevisitsinQ12014,downfrom33%ayearearlier.Googledrove82%oftotalU.S.organicsearchvisitsand87%ofmobilesearchvisits.
• Mobilegenerated31%oforganic searchvisits inQ1.The iPadand iPhoneeachdrovemoreorganicsearchvolumethanallAndroiddevicescombined.
• NotProvidedquerysharehasremainedstablesinceOctoberof2013andnowstandsatanaverageof85%ofGooglesearchvisits.
• Facebookgenerated54%ofsocialmediareferralsinQ1.Pinteresthasshownrapidgrowth,butwithawiderangeofinfluencefromsitetosite.Forthetopquartile,Pinterestgenerated47%ofsocialreferrals,butforthebottomquartilethatfigurewasjust3%.
• Mobiledevicesaccountedfor37%ofsocialmediareferralsinQ1,upfrom22%ayearearlier.
COmPARISON SHOPPING ENGINES
• AmongadvertisersrunningbothAmazonProductAdsandGooglePLAs,RKGfoundProductAdsCPCsrunning 31% higher, due largely to Amazonmaintaining its rate card fromQ4 toQ1. Consequently,ProductAdsvolumesufferedincomparison.
• Nextag’sshareofCSEspendingdeclinedto2%inQ1thisyear,from13%ayearearlier.EngineswithmoreflexiblebiddingsystemslikePriceGrabberandtheeBayCommerceNetworksawgains.
DISPLAy ADvERtISING
• WhilerevenueperclickisnearlyidenticalbetweenFacebookExchange(FBX)adsandotherdisplayads,CPCremains33%loweronFacebook,resultinginsuperiorROI.
• ForadvertisersactivelyadvertisingontheGoogleDisplayNetwork(GDN)andrunningAdWordspaidsearchads,GDNaccountedfor6%oftotalGooglespending.
muLtI-CHANNEL
• Lasttouchattributionmodelsshowaffiliatesaccountingformorethan15%ofrevenueinQ1,upfrom11%ayearearlier.Emailcontinuestoshowyear-over-yeardeclinesinlasttouchrevenueshare,likelytheresultofmobileemailcheckingandtherelegationofmarketingemailstoapromotiontabinGmail’stabsystem.
ExECutIvE SummARy
PAID SEARCHSinceourlastreport,twoofthebiggeststoriesinpaidsearchthathavepiquedmarketers’ interesthavedonesomorefortheirsymbolismthananysubstantive impacts they will have in the nearterm. InFebruary, Yahooannounced itsGeminiprogram, which is nowmigratingmobile searchad traffic away from the Bing Ads platform. InthefirstquarterwefoundmobileBingAdstrafficmadeupalittleover4%ofU.S.advertisers’paidsearchclicks.WiththattrafficsplitbetweenYahooandBing,onlyabout4%of searchclickswillbeaffectedbythischangeandasmallerpercentageofsearchadrevenues.
In early April, Google confirmed that it will nolonger be passing raw user search queries toadvertisers via the referring URL, effectivelybringingNotProvidedtopaidsearch.Whilethischange will hinder some query-based keywordandnegativeresearch,itwillnotimpactkeywordreportingorbidding.WhileNotProvideddealtaheavy blow to organic search analytics, for paidsearchitwillbeonlyarelativenuisance.
Overthefollowingpageswe’llhighlightsomeofthemoremeaningfulissuesaffectingpaidsearchtrendsincludingthecontinuinggrowthofproductads and mobile, as well as Google’s EnhancedCampaignsmodelandadvertisers’responsetoit.
PAID SEARCH 5
total Paid Search Spending Rises 17% in Q1Paid search spending growth got offto a fairly sluggish start in Q1, butclosed strongly with ad spend up17% Y/Y for the full quarter on 11%higher clicks and 6% higher cost perclick(CPC).Thisintra-quartertrendingpointstosomeresidualimpactsofanaggressive Q4 holiday push amongretailers.
Overall U.S. Paid Search Trends
ClicksAdSpend CPC
+6%
RelativetoQ12013
+11%+17%
+75%
+50%
+25%
2013-Q1
-25%
2013-Q42012-Q4 2013-Q1 2013-Q2 2013-Q3 2014-Q1BASELINE
Google Paid Search Spending Growth Decelerates SlightlyAs the dominant player in the U.S.search market, Google’s growthtrendsmirrortheoverallfiguresabovewith spending up 17% Y/Y, clicks up10% and CPCs up 6%. In Q4 2013,RKG foundGoogle spending growthat 19% Y/Y, so this marked a slightdeceleration.FromQ4toQ1wesawspendingdecline27%,whichistypicalof theseasonalityweseeamongourretail-leaningclientsample.
Google Overall U.S. Paid Search TrendsRelativetoQ12013
ClicksAdSpend CPC
+6%+10%+17%
+75%
+50%
+25%
2013-Q1
-25%
2013-Q42012-Q4 2013-Q1 2013-Q2 2013-Q3 2014-Q1BASELINE
Bing Ads Growth Returns to Industry Average After Huge 2013 GainsThroughout 2013, RKG found BingAds spending growth reaching twoto three times that ofGoogle levels.Now that we are running up againstthosestrongcomps,weseeBingAdsgrowth falling back in line with theindustryoverallwithspendingup17%Y/Y on 16% higher click volume and1%higherCPCs.
Bing Ads Overall U.S. Paid Search TrendsRelativetoQ12013
+75%
+50%
+25%
2013-Q1
-25%
2013-Q42012-Q4 2013-Q1 2013-Q2 2013-Q3 2014-Q1
ClicksAdSpend CPC
+1%
+16%+17%
BASELINE
PAID SEARCH 6
Google Non-Brand Spending Growth Outpaces Overall LevelsFor more competitive, non-brandtraffic, including Product Listing Ads(PLAs),Google spendinggrowthwas18%Y/YinQ1,withclicksup8%andCPCsup10%.Lowerspendinggrowthon brand traffic depressed overallgrowth, asbrandCPCs fell 9%, likelytiedtoAdRankchangeslastOctober.
Google Non-Brand U.S. Paid Search TrendsRelativetoQ12013
+75%
+50%
+25%
2013-Q1
-25%
2013-Q42012-Q4 2013-Q1 2013-Q2 2013-Q3 2014-Q1
ClicksAdSpend CPC
+8%+10%+18%
BASELINE
Bing Ads Non-Brand Spending Growth at 22%SimilartoresultsonGoogle,spendinggrowthonBingAdswas stronger fornon-brand traffic,where click volumeincreased14%Y/Y,CPCsincreased7%and ad spend increased 22%. WhileCPCs forBingAdsbrand traffichavefallensharplyinthepastyear,includinga 14% Y/Y decline in Q1, Bing Ads’brandCPCs remainwellabove thoseforGoogle.
Bing Non-Brand U.S. Paid Search TrendsRelativetoQ12013
+75%
+50%
+25%
2013-Q1
-25%
2013-Q42012-Q4 2013-Q1 2013-Q2 2013-Q3 2014-Q1
ClicksAdSpend CPC
+7%+14%+22%
BASELINE
Product Ads Driving Bulk of Paid Search GrowthImage-based product ads, includingGoogle’s Product Listing Ads (PLAs)format and Bing’s Product Ads aredrivingthebulkofoverallpaidsearchgrowth across theRKGclient samplewithadspendup69%Y/Yandclicksup51%.Bycomparison,textadspendinggrowthwasjust6%withclicksup4%.
Overall U.S. Paid Search Growth by FormatQ1 2014
75%
50%
25%
0%
TextAdsPLAs/ProductAds
AdSpend Clicks CPC
PAID SEARCH 7
PLAs Generate 29% of Google Paid Search Clicks for RetailersAmong retailers using the format,PLAstooksharefromGoogletextadsat a faster rate in Q1 2014. Overall,PLAsgenerated29%ofGooglepaidsearchclicksforretailers,andhalfofallnon-brand clicks. Google gave PLAsgreaterprominence inthequarterbyshowingthemabovethemainsearchresults, instead of on the right rail,morefrequently.
PLA Share of Google Paid Search ClicksAggregateResults-U.S.Retail
+29%
+50%
60%
40%
30%
20%
0%2013-Q42012-Q4 2013-Q1 2013-Q2 2013-Q3 2014-Q12012-Q2 2013-Q3
50%
10%
Non-Brand
Overall
PLA ROI Still 14% Better than Comparable Non-Brand text AdsSuggesting there may still be roomfor PLA CPCs to increase, ROI forthe formatwas 14%higher than thatfor non-brand text ads in Q1. Click-through rates for PLAs were morethandoublethosefornon-brandtextads,whileconversionrateswere50%higher for themedianretailclientweanalyzed.
PLA CPCs Edge Down Compared to text Ads in Q1, But trending Higher Over Long-termAgaincomparedtonon-brandtextadsamongretailsites,PLACPCswere8%higher than those for the traditionaltextformat.Thatwasdownfroma13%advantageinQ42013,butPLACPCshaveexhibitedastrongupwardtrendover the last twoyearsasadvertisersexploittheROIadvantageofPLAs.
Google PLA CPC vs Non-Brand Text AdsMedianSiteResults-U.S.Retail+25%
Non-BrandTextAds
-25%
2013-Q42012-Q4 2013-Q1 2013-Q2 2013-Q3 2014-Q12012-Q2 2012-Q3
+8%
BASELINE
PLA Performance vs Text AdsMedianSiteResults-U.S.Retail+150%
+50%
TextAds
-100%
+100%
-50%
PLAsvsNon-BrandTextAdsPLAsvsOverallTextAds
CPC CTR ROI Conv.Rate AOV
BASELINE
64%
8% 24%
134%
-56%
14%
50%
-16% -17%-11%
PAID SEARCH 8
PLAs Nearly 60% of Google Paid Search Clicks for Consumer Electronics RetailersWecontinuetoseeawiderangeinPLAs’shareofnon-brandtrafficacrossretailsub-industries,buttheformatisa significantcontributorevenat thelowerendofthespectrum.AtypicalApparel retailer generated 32% oftheircompetitiveGoogletrafficfromPLAs, while the median ConsumerElectronicsretailergenerated58%.
PLA Share of Non-Brand Google Paid Search ClicksMedianSiteResults-U.S.RetailQ12014
Flowers&Gifts
Cars&Auto
Health&Beauty
Apparel SportingGoods
Books Home&Garden
ConsumerElectronics
40%
0%
60%
20%
Bing Product Ads make Strides in Q1, Contribute 12% of Non-Brand RevenueJust out of beta testing at theend of the quarter, Bing ProductAds accounted for 12% of non-brand Bing Ads revenue amongparticipants in the program. Thatis a significant improvement overthe previous quarter when ProductAds contributed 8% of non-brandrevenueatalowerROI.
Bing Ads — Product Ads Share of Non-BrandMedianSiteResults-U.S.Retail
2013-Q4 2014-Q1
10%
0%
15%
5%
AdSpend AdClicks Revenue
Bing Product Ads Revenue Per Click up Sharply Compared to text AdsWhileProductAds’shareofBingAdsclicksonlyimprovedslightlyfromQ4toQ1,amuchimprovedrevenueperclick(RPC)drovethestrongrevenuegains seen above. In Q4 2013, thenascent format delivered an RPCthatwas 22% lower thannon-brandtextad levels. InQ1,BingAdsRPCrosetosurpassnon-brandtextadsinvalueby79%.
Bing Ads — Product Ads vs Non-Brand Text AdsMedianSiteResults-U.S.RetailQ12014
CPC RPC CTR
+50%
+100%
-50%
TextAdsBASELINE
Non-Brand -3%
79%
-2%
PAID SEARCH 9
Google Share of u.S. Paid Search market Edging Back upWhileBingAdsmadestridesintakingpaidsearchspendandclicksharefromGoogleinlate2012andearly2013,wehaveseenabitofareversalinrecentquarters.AmongourQ1clientsample,Google’sshareofU.S.paidsearchadspendwas83%,upatenthofapointfromQ4,whileGoogle’sshareofpaidsearchclickswas82%inQ1,upeighttenthsofapoint.
Google Share of U.S. Paid Search
84%
83%
82%
86%
2013-Q42012-Q4 2013-Q1 2013-Q2 2013-Q3 2014-Q1
83%
85%
82%
AdSpend Clicks
81%
Google Generating 33% Higher Revenue Per Click for Advertisers than Bing AdsLooking at non-brand ads, includingPLAs and Product Ads, Googlegenerateda 33%higher revenueperclick than Bing Ads for the medianadvertiser in Q1. Advertiser ROI onGoogle was 12% higher, thanks inlarge part to PLAs and the relativeimmaturityofthatauction.
Non-Brand: Google Metrics vs Bing AdsMedianSiteResults-Q12014
+10%
+40%
+20%
-10%
+30%
Bing Ads Closer to Parity with Google on Brand Ads, Except for CPCsWeseemoresimilaritybetweenBingAds and Google when looking atconversion metrics for brand traffic.However, brand CPCs on Googlestill run nearly 40% lower, leading toa much higher ROI and suggestingthat advertisers receive a greateralgorithmic ranking advantage fortheirbrandtermsonGoogle.
Brand: Google Metrics vs Bing AdsMedianSiteResults-Q12014
50%
100%
-50%
Non-BrandBASELINE
BingAds
RPC CPC ROI AOV CR
12%
35%
22%
33%
Non-BrandBASELINE
BingAds 9%
-39%
90%
2% 11%
RPC CPC ROI AOV CR
2%
PAID SEARCH 10
0%
Smartphones and tablets Each Generate 18% of Paid Search ClicksWithashareof18%each,smartphonesandtabletscombinedtogenerate36%of paid search clicks in Q1, up from32% in Q4 2013. Smartphones havegainedmoreshareoverthepastyearthantablets,6%vs5%,despitemanyRKG programs reducing smartphonebids to improve ROI over that timeframe.
Mobile Share of Paid Search Clicks
20%
10%
40%
30%
Tablet Smartphone
18%
18%
With Lower CPCs, Smartphones Account for Just 7% of Paid Search Ad SpendBetween smartphones and tablets,27% of paid search ad spend wasmobile in Q1, but smartphones onlyaccounted for 7% of spend despitetheir 18% share of clicks. This is areflection of ROI-focused advertisersaccounting for the disparity inconversionperformanceacrossdeviceclasses.
Mobile Share of Paid Search Ad SpendTablet Smartphone
20%
7%
20%
10%
30%
0%
38% of Google Paid Search Clicks are mobile, 25% for Bing AdsGoogle continues to hold a relativeadvantage in monetizing its mobiletraffic with 38% of its paid clickscomingfromsmartphonesandtabletsinQ1,comparedto25%forBingAds.Google gained ground in this areafromquartertoquarterwithitsmobileshareup4%versus1%forBingAds.
Mobile Click Share by Engine
20%
10%
40%
30%
0%
Google BingAds
Combined Smartphone Tablet
PAID SEARCH 11
Google Smartphone CPCs Slip to 35% of Desktop LevelsAs noted earlier in this report, RKGadvertisers have moved to improvesmartphone ROI by reducingtheir CPCs for smartphone clicks.Smartphone CPCs have fallen fromnearly 60% of desktop levels in Q1of2013 to35%thispastquarter.Therecentresultsareabetterreflectionofthevaluebeingdrivenbysmartphonetraffic.
Google Mobile CPC vs Desktop120%
60%
40%
20%
80%
100%
0%
98%
35%
Desktop
TabletSmartphone
2013-Q42012-Q4 2013-Q1 2013-Q2 2013-Q3 2014-Q1
Smartphone Revenue Per Click trending Higher Post-Enhanced CampaignsForsmartphoneCPCstoevercatchorsurpassdesktoplevels,advertiserswillneedtoseethevalueofsmartphoneclicks improve. At least in termsof direct response revenues, weare seeing progress in this area assmartphonerevenueperclickhasrisenfrom23%ofdesktoplevelsinQ12013to34%inQ12014.EnhancedCampaignsand RKG’s bidding platform havehelpedadvertisersbettercapturetop-performingmobiletraffic.
Revenue Per Click vs Desktop120%
60%
40%
20%
80%
100%
0%
84%
34%
Desktop
2013-Q42013-Q1 2013-Q2 2013-Q3 2014-Q1
TabletSmartphone
Desktop Clicks Down 3% y/y, Smartphone Clicks up 64%Despite RKG advertisers reducingsmartphone CPCs 21% year-over-year to bring ROI more in line withdesktops, smartphone click growthwas 64% in Q1, surpassing tablets,whichsawa10% increase inCPC.Atthe same time, desktop click volumewas down 3% Y/Y, although spendrose9%duetohigherCPCs.Google’s
Year-Over-Year Growth by Device Class
Smartphone
Desktop
Tablet
80%
20%
0%
-20%
40%
60%
AdSpend Clicks CPC
EnhancedCampaignsmodelhashelpeddrivesmartphonevolumegrowthbymakingiteasiertoscalemobilekeywordcoverageandbiddingsegmentation.
9%
-3%
29%
72%64%
56%
13%
-21%
10%
PAID SEARCH 12
iPad Share of tablet traffic Slips to 80%, Windows Devices in Distant Second PlaceThough still far and away the largesttraffic driver among tablets, the iPadsawitsshareoftablettrafficslippost-holiday from 84% to 80%. Touch-compatible Windows computers,including the Surface, have quicklytakenthenumbertwospotwithover5%oftrafficinQ1.TheKindleFireandGalaxy Tab lines each generated 4%of tablet clicks, while Nexus tabletsaccountedfor1.2%oftabletclicks.
2014-Q12013-Q4
2013-Q22013-Q12012-Q4
2013-Q3
OtherTablets
75%
50%
25%
0%
100%
iPad OtherTablets
4%
3%
2%
0%
5%
1%
WindowsTablet
OtherAndroid
Kindle GalaxyTablet
NexusTablet
6%
Google Estimates Suggest Cross-Device Accounts for 20% of Smartphone ConversionsAccording to Google’s conversiontracking data and estimates,smartphones accounted for anaverage of just 10% of single deviceconversions in Q1, but initiated athird of all cross-device conversions.Cross-device conversions amount to20%ofconversionsGoogleattributesto smartphones, but just 7% ofconversionsacrossalldevicetypes.
Windows tablets Remain Best Performing
Looking at revenue per click acrossdevices, we found that Windowstablets were the best performing foradvertisers in Q1, generating a 13%higherrevenueperclickthandesktop.Ayearearlierthough,Windowstabletsproduced a 42% higher RPC thandesktops,suggestingthattherewasastrongearlyadoptereffectthatisnowwearingoff.
Revenue Per Click by Device vs DesktopQ1 2014
100%
80%
60%
20%
0%
40%
120%
Desktop
Windows
Tablet
Desktop
iPad
Other
Tablets
OtherAnd
roid
Tablets
Nex
usTablet
iPho
ne
KindleFire
And
roid
Phone
Other
Dev
ices
Windows
Phone
Other
Phone
s
Devices, But Gap Narrows
% of Est. Cross-Device Conversions
% of Est. Single-Device Conversions
Cross-Device % ofEst. Total Conversions
DesktopSingle-DeviceCross-Device
TabletSingle-DeviceCross-Device
SmartphoneSingle-DeviceCross-Device
72%
17%
10%
53%
14%
33%
6%
20%
TabletConversions
5% DesktopConversions
SmartphoneConversions
PAID SEARCH 13
Not Provided Quickly Jumps to 45% of AdWords Search ClicksOnApril9th,GoogleannouncedthatitwouldsoonnolongerpassrawusersearchqueriestoAdWordsadvertisersvia referrer, effectively bringing NotProvidedtopaidsearch.Whileasmallpercentage of ad clicks did not passqueriespriortothischangeforotherreasons, Not Provided immediatelyreached37%ofGooglepaidclicksonthedayof the announcement. Overthe next several days, Not Providedsharehasbeensteadyatabout45%.
Not Provided Share of Google AdWordsPaid Search Traffic
Clicks from Safari users twice as valuable as an Average ClickAs Google’s Enhanced Campaignsmodelismakingiteasierforadvertisersto incorporate user context likegeography and device into biddingsegmentation, the searcher’s browserremains a strong predictor of trafficquality that does not have its ownbid modifier. In Q1, a Safari 7 usergenerated an average revenue perclickthatwasmorethantwiceashighas the overall average. Conversely,Internet Explorer 8 users had a 24%lowerthanaverageRPC.
Revenue Per Click by Desktop Browservs Overall Average
Exp
lorer10
Exp
lorer9
Exp
lorer8
Chrome31
Chrome32
Chrome33
Firefox25
Firefox26
Firefox27
Safari5
Safari6
Safari7
+125%
+100%
+50%
-25%
+25%
+75%
AverageBASELINE
Overall -24%16%
23%
11%
31% 29%
16%
44%
99%
119%
-9% 2%
50%
40%
20%
10%
30%
0%
4/1/20
14
4/13
/201
4
4/2/20
14
4/3/20
14
4/4/20
14
4/5/20
14
4/6/20
14
4/7/20
14
4/8/20
14
4/9/20
14
4/10
/201
4
4/11
/201
4
4/12
/201
4
45%
ORGANIC SEARCH & SOCIAL
Measuring organic search trends has been likeagameofWhac-A-Moleover the last coupleofyears.Asone issue impairingsiteowners’abilityto assess their data gets resolved, another onewill spring up. In Q1 2014, Yahoo.com begandefaulting to secure search, which resulted innearlyhalfofYahoosearchvisitsbeingrecordedas direct site visits from early January throughearlyFebruary.
Similar to an issue with Google searches ondevicesusing iOS6,Yahoo initiallydidnotpassany referrer information for its secure searches,making it impossible for analytics to determinethe source of the traffic.When Yahoo began topass referrers in early February, some analyticspackages,includingGoogleAnalytics,categorizedthevisitsasreferralsratherthanorganicsearch,anissuethatpersistsasofthiswriting.
WhiletheiOSissuereducedtheperceivedshareoforganicsearchvisitsasapercentageofallsitetrafficbynearly 4%at itspeak last year, Yahoo’ssecuresearchmoveaffectedabout1%ofsitevisitsonaverage.Thoughasmallpercentage,‘hidden’Yahoo searchesmay be the difference betweentotalorganicsearchvisitsbeingseenasgrowingordecliningyear-over-yearformanysites.
ORGANIC SEARCH & SOCIAL 15
Organic Search visit Share Stable at 30%, Despite yahoo Secure Search IssueIncluding RKG estimates for organicsearchvisitshiddenbyiOS6lastyear,wefindthatorganicsearchvisitsharehas been fairly stable from Q3 2013toQ12014atbetween30-31%.Overa longer window though, organicsearch visit share has slipped slightlyfrom33% in thefirstquarterof2013.TheperiodoverJanuaryandFebruarywhenYahoosecuresearchdidnotpassreferrers depresses the Q1 numbersslightly.
Organic SearchShare of All U.S. Site Visits
35%
30%
25%
0%
40%
2013-Q42012-Q4 2013-Q1 2013-Q2 2013-Q3 2014-Q1
OrganicRecorded OrganicActual
30%
Hidden yahoo Searches Skew Search Share trendsRKG finds that Google’s share oforganic search visits edged up onepercentage point from Q4 to Q1,while Yahoo’s share fell by the sameamount.Thesefiguresdonotattemptto account for the Yahoo searcheshiddenbysecuresearchovertheearlypart of the quarter. Doing so wouldproduceresultsshowinglittlechangefromquartertoquarter.
U.S. Organic Search Visit Share by Engine
75%
50%
25%
0%
100%
2013-Q42012-Q4 2013-Q1 2013-Q2 2013-Q3 2014-Q1
Google Yahoo OtherBing
yahoo Secure Search move Impacted 1% of All Site visitsThepointatwhichYahoo.combegandefaulting to secure search is quiteobvious when we look at a weeklytrendoftheshareoftrafficattributedtoYahooorganicsearch.OverthefirsttwoweeksinJanuary,Yahooorganic’smeasurable share of all site visitsdropped from 2.5% to 1.5%. Duringthe first week of February, Yahootrafficappears to reboundasa resultof referrers, now stripped of searchqueries,beingpassedagain.
Yahoo Organic SearchShare of All U.S. Site Visits
2%
1%
0%
3%
2013Dec1
Dec15
2014Jan1
Jan15
Feb1
Feb1
5Mar1
Mar15
Mar30
YAHOOSECURE
SEARCHBEGIN
S
ORGANIC SEARCH & SOCIAL 16
Google Continues to Hold Relative Advantage in mobile Search ShareWhile Google generates roughly81%oforganicsearchvisitsoverall, itcontinuestogenerateahigherportionof mobile search visits. In Q1 2014Googleaccountedfor87%ofmobileorganicsearchvisits,comparedto8%forYahooand5%forBing.
Share of U.S Mobile Organic Search by EngineQ1 2014
Yahoo
Bing
87%
8%
5%
iPad and iPhone Each Drive more Organic Search visits than all Android Devices CombinedMobiledevicesaccountedfor31%oforganic search visits in Q1, up from24% a year earlier. iPad users drove12%of all search visits, compared to11%foriPhoneusersand8%forusersofallAndroiddevicescombined.
Mobile Share of U.S. Organic Search Visits35%
20%
10%
0%
30%
25%
15%
5%
Android iPhoneiPad Other
2013-Q42012-Q4 2013-Q1 2013-Q2 2013-Q3 2014-Q1
mobile’s Share of Bing traffic Doubles year-Over-year, Still Half that of Google, yahooIn Q1 2014, 16% of Bing organicsearch visits occurred on mobiledevices,doublethesamemetricfromayearearlier.Bycomparison,mobilewasamuchlargerportionoftrafficforGoogleandYahoo,whichsawmobileaccount for 33% and 36% of visits inQ1,respectively.
Share of Each Engine’s Traffic from Mobile
30%
20%
10%
0%
40%
2013-Q42012-Q4 2013-Q1 2013-Q2 2013-Q3 2014-Q1
Google YahooBing
ORGANIC SEARCH & SOCIAL 17
mobile Search Growth Offsetting Desktop DeclinesA 29% year-over-year increase inmobile organic search visits pushedoverall organic search growth intopositive territory inQ1.Organicvisitshidden by Yahoo’s move to securesearchdepressthesenumbersslightly.
Y/Y Growth in Organic Search VisitsQ1 2014
30%
20%
10%
0%Mobile All
Not Provided visit Share Steady at 85%TheshareofGoogleorganicsearchesthatdidnotpasssiteownerstheuser’srawsearchqueryhasbeenfairlysteadysinceOctober of 2013 and stands at85%. This Not Provided percentageaccelerated in Q3 of last year asGoogle pushedmore users andwebbrowsers to secure search. Queriesstill being passed have been biasedtowards certain web browsers anddevices,suchasSafariandAndroid.
Not Provided Share ofGoogle Organic Search Traffic
75%
50%
25%
0%
100%
FebMarJa
nAprMayJu
n
2013
JulAugSepOct
Dec
Nov
FebMarJa
nAprMayJu
n
2012
JulAugSepOct
Dec
Nov
FebMarJa
n
2014
Bounce Rates for mobile Search Remain 5% Higher than Desktop Bounce RatesThe average bounce rate for mobileorganic search traffic was 46% inQ12014 compared to 41% for desktoporganic search. The gap betweenthe two device classes has been apersistent one with this quarter’sresults mirroring performance fromtwoyearsearlier.
Mobile Overall
Organic Search Bounce RatesMobile vs Overall Q1 2014
40%
30%
20%
0%
50%
10%
ORGANIC SEARCH & SOCIAL 18
Social media Sites Contribute an Average of 1.5% of All Site visitsTheimportanceofsocialmediasitesastrafficreferrersremainshighlyvariablefromsitetosite,butonaveragewefindthatsocialsitesgenerated1.5%ofallsitevisitsinQ12014,aslightincreasefromQ42013.Atthehighend,wefindsomesitesgenerating10-15%oftheirtrafficfromsocial.
Social Share of All Site Visits
1.5%
1.0%
0.5%
0%
2.0%
2013-Q42012-Q4 2013-Q1 2013-Q2 2013-Q3 2014-Q1
Pinterest Generates 25% of Social Referrals on Average, But Impact Not ConsistentFacebook continues to be thedominant generator of social mediareferrals with a share of 54% in Q12014. Pinterest is very interestingthough,asithasshownrapidgrowth,particularly for retail sites. In Q1 wefound Pinterest generated 25% ofsocial media referrals on average,butwith a verywide rangeof resultsfromsitetosite.Forthetopquartile,Pinterest generated 47% of socialreferrals, but for the bottom quartilethatfigurewasjust3%.
Share of Social Media Referrals
YouTube
Google+
Other
54%
3%
25%
2%
3%
0.8% 12%0.4%
mobile Devices Account for 37% of Social media ReferralsWhile Facebook generated 53% ofitsQ42013 revenue frommobile,wefindthatmobileaccountedfor37%ofall social media referrals in Q1 2014and 35% of Facebook referrals. Thismay speak to the nature of the adsdriving Facebook’s mobile revenues,particularly mobile app install ads,which do not refer traffic to sitesdirectly.
Mobile Share of Social Media Referrals
2013-Q42012-Q4 2013-Q1 2013-Q2 2013-Q3 2014-Q1
30%
20%
10%
0%
40%37%
COMPARISON SHOPPING ENGINES
COMPARISON SHOPPING ENGINES 20
Amazon Product Ads See Biggest y/y Average CPC IncreaseWhile Amazon Product Ads, Nextagand Shopzilla all saw year-over-year increases in average CPC,PriceGrabber and eBay CommerceNetwork (ECN) CPCs held relativelysteady. The flexible bidding optionson these two engines have allowedadvertisers to keep CPCs the sameover time, while the other engines’more rigidbidsystemsand increasesinratecardminimumshaveresultedinsteadyCPCincreases.
CPC by Engine$0.70
$0.40
$0.20
$0Amazon
ProductAdsNexTag eBay
CommerceNetwork
Shopzilla-Bizrate
Other
2013-Q1 2014-Q1
PriceGrabber
$0.60
$0.50
$0.30
$0.10
Nextag Spend Share Nearly Gone, Down to 2% of CSE SpendThe declining value of Nextag traffichas further reduced spend share onthe engine, down from 13% in Q1of last year to 2% in Q1 this year.PriceGrabberandtheeBayCommerceNetworkbothsawincreasesinspendshare year-over-year as their flexiblebidding systems allow advertisersto adjust bids on low performingproducts rather than exclude themfromtheirfeedentirely.
Ad Spend Share by Engine40%
30%
20%
0%
10%
AmazonProductAds
NexTag eBayCommerceNetwork
Shopzilla-Bizrate
Other PriceGrabber
2013-Q1 2014-Q1
Advertisers Getting Less Revenue out of Nextag, Shopzilla y/yWhile advertisers generated lessrevenue from Shopzilla-Bizrate andNextag year over year, revenue fromthe eBay Commerce Network grew55%. The ECN continues to expandby attracting new partners whileprovidinghighvalueclicks.
PriceGrabber eBayCommerceNetwork
Shopzilla-Bizrate
NexTag AmazonProductAds
80%
20%
0%
-80%
-40%
Y/Y Q1 Same Site Revenue Growth
COMPARISON SHOPPING ENGINES 21
Amazon Product Ads Average CPC 31% Higher than Google PLAsAverage CPC for Amazon ProductAds went from running 18% lowerthan Google Product Listing Ads inQ4to31%higherinQ1.PLAaverageCPC decreased for most advertiserspost-holiday in response todecliningvalueandcompetition.Amazon’sratecards, on the other hand, remainedunchangedfromquartertoquarter.
Amazon Product Adsvs Google PLA CPC140%
80%
40%
0%
120%
100%
60%
20%
GooglePLA AmazonProductAds
Revenue from Google PLAs Now more than ten times that of Amazon Product AdsFor advertisers using both, AmazonProduct Ads produced just 9% ofthe revenue volume seenonGooglePLAs,downfrom11%inQ4,asPLAssaw relative traffic increases in Q1.Relative revenue contribution variessignificantly by industry as a resultof Amazon’s restrictions on somecategories such as Apparel, as wellas PLAs being larger for retail sub-industrieslikeHome&Garden.
Amazon Product Adsvs Google PLA Revenue
80%
40%
0%
120%
100%
60%
20%
GooglePLA AmazonProductAds
DISPLAY ADVERTISING
DISPLAY ADVERTISING 23
GDN Accounts for 6% of total Google SpendingForadvertisersactivelyadvertisingonthe Google Display Network, GDNspendis6%oftotalGooglespendingincludingAdWordstextadsandPLAs.ThemajorityofGDNspendisallocatedto remarketing and placement ads,while a small percentage goes tocontextualads.
Google Text Ad Spend vs GDN
GoogleTextAd&PLASpend
GDNSpend
80%
40%
0%
120%
100%
60%
20%
Ad Spend on the Facebook Exchange Dropped Significantly in Q1Following the holiday season,investment on the Facebook AdExchange dropped over 40%. Thisis due largely to seasonality withinthe retail sector and decreasedcompetitionassomeadvertiserswhoinvestedinthespaceovertheholidaysexitedoncedemanddieddown.
Facebook Exchange Ad Spend & CPC Q/Q
AdSpend CPC
80%
40%
0%
120%
100%
60%
20%
2013-Q4 2014-Q1
Advertisers Investing more Heavily in Placements and Retargeting than Contextual Ads on the GDNPlacementandretargetingadsaccountfor almost five timesmore spend ontheGDNthancontextualads.CPCisalsosignificantlyhigherforplacementand retargeting ads, as these clickstypicallycarrygreatervalue.
GDN Placements & Retargeting vs Contextual
AdSpend CPC
80%
40%
0%
120%
100%
60%
20%
Placements&Retargeting Contextual
DISPLAY ADVERTISING 24
Lower Average CPC on FBx Remains Key Performance DifferentiatorWhile revenue per click is nearlyidentical between FacebookExchange ads andotherdisplay ads,CPCremains33%loweronFacebook.This has resulted in superior ROI ontheFBXplatform,asthereisstillroomforcompetitiontodriveupthecostoftraffic.
Facebook Exchange vs Other Display
FBx Conversion Rate Higher, AOv Lower than Other DisplayWhile FBX ads offer a slightly higherconversion rate than other displayads, average order value on FBX is12% lower. Thismay be indicative ofthedemographicdifferencesbetweenFBXtrafficandclicksfromotherdisplaysources.
Facebook Exchange vs Other Display
most Advertisers Continuing to Pursue mixed Prospecting, Retargeting Display Strategy70%ofRKGadvertisersare targetingboth new and existing customers intheirdisplaystrategies,upfrom63%inQ4.Retargetingremainsmorepopularthan prospecting among those notusingamixedstrategy.
Percentage of RKG Clients’ Display Goals
CPC RevenuePerClick
80%
40%
0%
120%
100%
60%
20%
DisplayOverall FacebookExchange
ConversionRate AOV
80%
40%
0%
120%
100%
60%
20%
DisplayOverall FacebookExchange
70%
20%
10%Prospect&RetargetingRetargetingOnlyProspectingOnly
MULTI-CHANNEL
MULTI-CHANNEL 26
Affiliate Share of Last touch Revenue up y/y, Email DownLast touch attribution models showaffiliatesaccountingformorethan15%ofrevenueinQ1,upfrom11%lastyear.Email continues to show year-over-year declines in last touch revenueshare, likely the result of mobileemail checking and the relegationofmarketingemails to apromotion tabinGmail’stabsystem.
Revenue Share Among Marketing ChannelsLast Touch Attribution Model
Affiliate CSEs DisplayAd Email OrganicSearch
PaidSearch
Social
2013-Q1 2014-Q1
Organic and Paid Search Revenue Share Higher in First touch modelAs search engines are frequently thefirst stop in the conversion processfor consumers researching products,organic and paid search account formuchhigher sharesof revenueusinga first touch model rather than lasttouch. 45% less revenue is attributedtoaffiliatesusingfirsttouchinsteadoflasttouch.
Change in Q1 Revenue Contribution Moving from Last Touch to First Touch Attribution Model
Affiliate CSEs DisplayAd Email OrganicSearch
PaidSearch
Social
Online Customers usually Interact with Just One ChannelTheaverageordernowinvolvesmorethan four marketing touches, butthe vast majority of customers (76%)interact with just a single channel.Eventheadvertisersmostlikelytoseetheircustomers interactwithmultiplechannels see about 60% of ordersplaced after interactionwith just onechannel.
Marketing Channels Per Order
One
Two
Three
Four
Five+75.6%18.6%
4.4%
1.1%0.4%
25%
-50%
50%
0%
-25%
30%
0%
40%
20%
10%
RKG is a search and digital marketing agency that combinessuperior marketing talent with leading-edge technology tocreate the industry’smost effective data-driven digital marketingsolutions.RKGdrivesbusinesstoclientsbymaximizingafullrangeof opportunities including paid search, SEO, product listing ads,socialmedia,displayadvertisingandcomparisonshoppingenginemanagementservices.
Foundedin2003,RKGpartnerswithclientssuchasDrugstore.com,Express,HermanMiller,JonesGroupandUrbanOutfitters.In2013,AdvertisingAgerankedRKGthefastestgrowingsearchagency.Aprivately held company, RKG is headquartered in Charlottesville,VAwithoffices inSanFrancisco,CA,Bend,ORandBoston,MA.For more information visit www.rimmkaufman.com or follow thecompanyonTwitter@rimmkaufman.
ABOut RKG
mEtHODOLOGyFiguresarederivedfromsamplesofRKGclientswhohaveworkedwithRKGforeachrespectivemarketingchannel.Whereapplicable,thesesamplesarerestrictedtothoseclientswho1)havemaintainedactive programs with RKG for at least 19 months, 2) have notsignificantly changed their strategic objectivesorproductofferings,and3)meetaminimumadspendthreshold.Alltrendedfigurespresentedinthisreportrepresentsame-sitechangesoverthegiven time period. Unless otherwise specified,thedatapoints in this report arederived fromtheNorthAmericanmarketregion.
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