Don’t Believe All the Mobile Hype? The Writing’s on the Tablet

If you’re one of the few marketers who read the holiday channel sales reports and still isn’t convinced that mobile marketing has entered the mainstream, consider this: In 2011’s fourth quarter, 87.6% of search ad clicks were carried out on desktop computers. In one short year that percentage dropped to 76.6%, according to a report released today by The Search Agency. Taking up all 11 points of that slack—smartphones with 13.6% of clicks and tablets with 9.8%. Last year the two combined for only 12.6%.

“Now you need to come up with a strategy to measure that activity directly through devices like coupons and loyalty program ID that can [link] offline with online. If you’ve got customers searching on mobile, but not necessarily buying, marketers have to determine what that connection is worth,” says Keith Wilson, VP of agency products for The Search Agency. Its quarterly “State of Paid Search Report” is based on the results of a sample of advertiser clients representing some $100 million in ad buys.

Recent reports from other researchers indicate mobile growth will not slow down anytime soon. ComScore’s quarterly report on mobile usage released in November counted 123 million Americans with smartphones, a penetration of 54% of the population. In August, according to its previous report, penetration was only 47%. The rise in mobile’s contribution to retail sales, meanwhile, nearly parallels its increased number of clicks. From 7% of e-commerce sales in 2011, eMarketer sees the mobile needle moving to 11% in 2012 and 15% this year.

Due to mobile’s increased popularity as a search medium, advertisers that pay by the click saw their spends in the fourth quarter increase by 199% for tablets and 44% for smartphones. Interestingly, spending on PC ads also showed a slight increase of 3%, indicating that customer time spent searching on mobile devices is incremental.

“This poses a great challenge to marketers. They’re excited and a little bit nervous,” Wilson says. “They’re excited because they have this new format. But they’re nervous about how to track performance of the channels. They have to better understand the consumer’s decision journey.”

Wilson says that marketers could do a better job of segmenting their users before determining what ads they deliver to them. “We know when someone is clicking an ad on a mobile device or a desktop, so why not test some different content?” Wilson says. “Say someone searches ‘HDTV.’ If you’re Best Buy, try delivering a store locator to the person clicking on a mobile device instead of sending a product ad.”

One other finding of note in the search report involved product listing ads, promoted with much fanfare by Google last summer. Retailers lavished 14% of their search budgets on PLAs during 4Q 2012, a 236 percent increase over the previous year. More than 60% of that spending was devoted to tablets and smartphones.

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