In Q1 2012, mobile paid search spend surged to 17.8% of all paid search expenditures, with mobile click share also reaching an all-time high of 24.6%. The growth is fueled by increased investment in mobile advertising and the distinction between smartphone and tablet users, leading to different strategies for each device. Despite mobile growth, desktop search volume continues to rise, indicating that users are integrating both mobile and desktop searches into their routines.

1. Performics Mobile Paid Search Benchmarks & Trends
(Q1 2012)
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2. Mobile Paid Search Spend Surges in March
 Mobile paid search spend
is now 17.8% of all paid
search spend
 Many advertisers “warmed
up” to mobile and
increased investment to
catch trends
 Mobile spend volume is
close to 5X higher YoY
 Tablets are 32.1% of
mobile spend
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* Based on Performics’ aggregate client base; Google AdWords (Content & Search Partners excluded) (April 2012)

3. Mobile Impression Share Peaks in March at 18.6%
 Driven by an increase
in tablet impressions,
mobile impression share is
now at an all-time
high
Tablets are now
39.6%
of all
impressions
This is a 12.1%
M/M increase
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* Based on Performics’ aggregate client base; Google AdWords (Content & Search Partners excluded) (April 2012)

4. What’s Driving Advertiser Interest in Tablets?
 Tablet and smartphone users differ, motivating advertisers to segment by
device in terms of strategy (day-parting, messages) & budget allocation
 Smartphones: your constant companion
– shopping/errands
– looking for store location, phone; click-to-call
– product reviews/comparisons in store
– geo check-in
 Tablets: your couch companion
– entertainment with families
– watching TV
– in bed
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5. Mobile Click Share Also Reaches All-Time High
 Breaking records set over
holiday, mobile paid clicks are
now 24.6% of all clicks
 In terms of mobile click
volume, Mar. 2012 is only
behind Dec. 2011
 Tablets are now 36.5% of
all clicks
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* Based on Performics’ aggregate client base; Google AdWords (Content & Search Partners excluded) (April 2012)

6. Where is This Growth Coming From?
Is Mobile Cannibalizing Desktop?
 Mobile is exploding, but not at the expense of desktop
 We see desktop search volume growing, just not
nearly at the pace of mobile
 This is a function of the always-connected searcher:
– Searchers aren’t abandoning their desktops in favor of mobile
– They search on their desktops at work, smartphones on the way home, and
tablets at night in front of the TV
 But, given the similarities in experience and that most tablet users are
tethered to Wi-Fi, tablets and laptops are sharing some territory
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7. Over Time, Device Will Be Just a Signal
 Searchers are de-tethering from the
office/home/desktop
 People are searching in entirely
new places, in the middle of new
exchanges and processes and
with entirely new needs
 Device will become merely a
signal. What's increasingly
important is understanding the
context, the specific audience and
its intent.
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8. With Low CPCs, Mobile Is Still a Buying Opportunity
 Tablets CPCs are 85% of
desktop CPCs
 Smartphone CPCs are 55%
of desktop CPCs
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* Based on Performics’ aggregate client base; Google AdWords (Content & Search Partners excluded) (April 2012)

9. Is Mobile’s Growth (with its Low CPCs) Hurting
Google’s Bottom Line?
 Mobile search continues to take a larger piece of
the search pie (especially due to localization)
 Mobile CPCs remain lower than desktop
 Therefore, overall (desktop + mobile) Google
CPCs dropped in Q4 and Q1, causing concern
for Google investors
 But the better indicator of Google’s health is click volume. Even if CPCs
drop, click growth results in higher revenue for Google.
 Plus, lower CPCs give advertisers more opportunity for efficiency
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10. Mobile CTRs Continue to Outpace Desktop
 Mobile CTRs increased
9.8% M/M and 25.2%
Y/Y
 March’s mobile CTR
increase was driven by
mobile devices (i.e.
smartphones) rather
than tablets
– Mobile device CTRs
increased 18.2% M/M
– Tablets decreased 2.1%
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* Based on Performics’ aggregate client base; Google AdWords (Content & Search Partners excluded) (April 2012)

11. What’s Driving Mobile CTRs Above Desktop?
 In March, mobile CTRs were driven by smartphones
 Google is increasingly providing advertisers with more opportunities for
enhanced listings on smartphones:
Sitelinks Click to Call Product Ads Location Extensions Offer Ads Click to Download
 On the smaller smartphone SERP, enhancements occupy more space (not to
mention, users don’t scroll like on desktop and tablets). Thus, CTRs rise.
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