Apple Inc.’s “intelligent tracking prevention,” or ITP, disrupted retailers’ ability to use Google’s remarketing lists for search ads (RLSA) product, at least temporarily, according to Merkle’s “Digital Marketing Report Q3 2018” that was released on Tuesday.

ITP puts a significant damper on mobile ad tracking. For example, it limits the use of cookies for ad retargeting to 24 hours, and it deletes a site’s cookies if a consumer doesn’t visit for 30 days. Apple announced ITP last December and launched the feature with iOS and Safari 12 in mid-September. After it went into effect, RLSA click share dropped to a seven-month low, the report says.

Overall, 30% of Google search ad clicks stemmed from ads that leveraged Google’s advanced targeting tools. Those include: Customer Match, which enables a retailer to upload its email lists to find its customers when they search on Google; remarketing lists for search ads (RLSA), which let a retailer customize its search ads campaign for consumers who have previously visited its site; and Similar Audiences, in which Google targets users who are searching the same terms as users recently added to the merchant’s RLSA lists, such as Customer Match. That’s down from 37% in the previous quarter.

Beyond ads that leveraged Google’s advanced targeting tools, Google search ad spending among retailers rose 18% year over year in the third quarter. Across all advertisers, clicks grew 9% and the cost per click rose 8%.

Phones accounted for 63% of retail and consumer goods advertisers’ Google search ad clicks in the third quarter, with desktop accounting for 30% and tablets 7%.

However, there was a sharp dichotomy between traditional text ads and Google Shopping ads; text ad spending grew just 3% while Shopping spending jumped 33%. And, excluding queries based on advertisers’ own brand names, Shopping Ads generated 87% of Google’s search ad clicks for retailers during the quarter, a five percentage point increase from the previous quarter.

[infogram id=”plas_share_of_clicks” prefix=”70Y” format=”interactive” title=”PLAs share of clicks”]

For brands running Google’s Showcase Shopping ads as part of their overall Google Shopping strategy, the new ad format accounted for 5.1% of Google Shopping phone clicks during the quarter, up from 4.4% in the second quarter. While that’s a relatively small percentage, Showcase Shopping click share has tripled since the fourth quarter of 2017.

The report also notes that Amazon.com Inc.’s use of Shopping ads was roughly consistent with its use at the end of the second quarter; the retail giant accounted for 37% of Google Shopping impressions in the home goods category, where it has been a top competitor since the end of 2016, save for a brief period when it dropped out of Google Shopping Ad listings.

Total visits driven by organic search rose 6% year over year. Organic search visits driven by Google grew nearly 9%, the largest percentage increase since the second quarter of 2015, which was just before the search giant boosted its ad inventory. The result was that the share of total site visits produced by organic search inched up to 26% and just under 25% on mobile devices. That’s only the second increase since the first quarter of 2017.

The report also found that social media isn’t driving much traffic to retailers’ sites. Facebook, Instagram and other social networks drove just 3.4% of site visits in the third quarter, down from 3.6% in the second quarter and from 3.8% a year earlier. On mobile devices, social networks accounted for 4.2% of site visits, down from 4.4% in the second quarter and 4.5% a year earlier.

That was the second straight quarterly decline, which Merkle attributes largely to Facebook; traffic from Facebook to brand sites fell 13% during the quarter, while visits from Instagram grew 111%, YouTube soared 70% and Pinterest grew 11%.

The report also finds that Facebook ad spending rose 25% year over year during the quarter. The cost-per-thousand impressions increased 18% and the number of impressions grew 6%.

Meanwhile, Instagram ad spending jumped 61% during the quarter and impressions rose 58%. The cost-per-thousand impressions grew 1%.

Looking at Instagram in comparison with Facebook, Merkle found that the median advertiser advertising on both platforms spent 19% on Instagram as it did on Facebook during the quarter. While that’s down slightly from the second quarter, the pool of advertisers using both platforms is growing as more advertisers leverage Instagram.

YouTube advertising spending rose 77% during the quarter, while impressions jumped 216% and the cost-per-thousand impressions fell 44%.

Amazon ads

Amazon’s advertising offerings continued to gain steam during the third quarter as Amazon Sponsored Products and Sponsored Brands, which had been called Headline Search Ads, grew 62% and 86% year over year, respectively. The cost per click for Sponsored Products fell 25%, and the cost per click for Sponsored Brands grew 21%.

Sponsored Product ads are keyword-targeted, cost-per-click ads that can either appear on the right-hand side or bottom of search results and product detail pages on desktop and mobile devices. Sponsored Brands are keyword-targeted, cost-per-click search ads that appear at the top of the first page of search results on desktop and mobile devices.

One reason that advertisers are increasingly leveraging Amazon’s ads is to garner attention on a platform with a growing ad load; Amazon updated its search results page layout in late August to include additional placements for Sponsored Brands ads. The move boosted Sponsored Brands impressions 131% in September, the highest number of impressions to date.

Sponsored Products are the dominant ad format on Amazon, accounting for 84% of all Amazon Marketing Services spending. Sponsored Brands accounted for 12% and Product Display ads just 3%. Product Display ads are cost-per-click ads aimed at helping drive sales and traffic to an Amazon product detail page.