This week, Econsultancy published an update to its PPC Bid Management Technology Buyer’s Guide. The report estimates that the market for PPC bid management technology will grow by 17% in 2012, in line with the overall North American search sector, which is predicted to grow from a value of $22.9 billion, to $26.8 billion in 2013.
The report shows that many areas of digital are increasingly integrated, with the biggest opportunities for growth in this sector coming from mobile paid search, a focus on multichannel retailing and the continuing forward march of social media.
Social media has huge implications for the future of pay-per-click ads, since social gives marketers access to a vast array of user data that enables them to make advertising highly personalised and targeted and increasingly relevant. Social websites also enhance the familiarity of the brand, which can have a significant impact on clickthrough rates, as Ed Stevenson, Managing Director at Marin Software indicates:
“GroupM research shows that consumers who see a brand on a social network are 50% more likely to click on a paid search advert, so advertisers now want to track and optimise this convergence using their paid search technology.”
Part of the impact of social media on pay-per-click ads stems from the increasing significance of recommendations from a trusted network of family and friends, which has a strong influence on customer purchase behaviour and the path to conversion.
In 2011, Google added the +1 button onto text ads, illustrating how personal recommendations can be incorporated into paid search. As well as the +1 button, AdWords now also includes seller rating extensions. These extensions add reviews and star ratings from Google Product Search onto paid search ads in Google.
Beyond Google, ads on social media platforms (including Facebook, Twitter and LinkedIn) offer marketers the ability to deliver targeted and relevant ads, based on the data provided by the user in their profile information.
As social network advertising continues to develop, for the bid management technology industry, this means the tools and technologies need to evolve to manage new types of inventory.
Oscar Romero, Search Strategy Director at Starcom MediaVest said:
“Longer-term, we will see more and more ‘liquid inventory’ being opened up to agencies by the likes of Facebook, Twitter and LinkedIn. Managing this additional inventory will require sophisticated bid management tools which are able to provide for the varying nature of these platforms and integrate with each of their APIs.”
Beyond social media, the mobile search landscape provides further opportunities for growth for the PPC bid management technology industry. According to research published this year by Adobe, US marketers are increasing their mobile ad spend in 2012. Mobile ad spend in the US now accounts for 8% of all search spend, while in the UK, mobile makes up 11% of search spend.
Findings from Econsultancy and NetBooster’s UK Search Engine Marketing Benchmark Report indicate that while companies and agencies are currently spending less than 10% on mobile search (4% for companies, and 9% for agencies), the percentage spent has doubled in just one year:
Given the growth of mobile search, it is becoming increasingly essential to understand how user behaviour varies across different devices when interacting with PPC ads. Research indicates that clickthrough rates on paid search ads on mobile devices are typically higher than for non-mobile devices, as Ollie Bath, Head of Client Solutions at IgnitionOne, reports:
“Mobile search is a highly valuable and under-utilised channel. The number of queries on mobiles and tablets are growing quickly and CPCs are typically lower, making mobile search a great investment.”
There are various ways in which marketers can adapt their paid search campaigns for mobile devices. As well as thinking about the keywords that users may be using on their mobile devices, marketers also need to make the most of location-specific data. Additionally, writing paid search ad copy specifically for particular devices is highly effective for engaging mobile users.
It is also worth noting that many of the trends within the digital marketing landscape are converging; as well as mobile and social, the rise of multichannel marketing and the increasing significance of attribution have tremendous impact on the broad spectrum of online channels.
There is plenty more information and detailed market trends in our PPC Bid Management Technology Buyer’s Guide, which contains profiles of 14 leading players in the market.
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