Desktop paid Google search ad clicks rose for the first time in more than two years to 30% in Q4 2019 from 27% in the previous quarter, according to Merkle’s recently released “Digital Marketing Report Q4 2019.” The report is based on Merkle clients that have actively worked with the digital marketing vendor for at least 19 months, haven’t significantly changed their strategic objectives or product offers, and have met a minimum ad-spend threshold not disclosed.
The increase in desktop clicks comes from the first decrease in two years of smartphone clicks for Google paid search ads at 65% clicks on mobile phones in Q4 2019, down from 68% the previous quarter.
Another reason for the surge in desktop clicks and reduction of smartphone clicks is the increase in desktop Google search spending and decrease in smartphone Google search spending in Q4 2019 both year over year and quarter over quarter. Previously, smartphone spending was 34% in Q3 2019 and 42% in Q4 2018, while desktop spending was 7% and 5%, respectively, for the same periods.
Overall, Google search ad spending increased by 16%, whereas clicks increased by 11% and cost-per-click (CPC) increased 4% from the previous quarter. The graph below shows a leveling out of search spend over the past year.
Remarketing lists for search ads (RLSAs) were primarily responsible for total Google clicks in Q4 2019, accounting for nearly 19% of this traffic. In contrast, Similar Audience targeting generated 11% of Google search ad clicks—up from 5% in 2Q4 2018—and customer match generated 5% in Q4 2019. Despite the holidays, seasonal audiences did not have an uptick in Q4 of this year, unlike the previous year, possibly a result of the shortened holiday shopping season in 2019.
Apple products were responsible for more than 50% of Google search ad clicks for the first time in 2019, with iOS devices claiming 48% of Google clicks and Safari desktop 6% in Q4 2019. Edge/IE and Chrome desktop were primarily responsible for Microsoft paid search advertising clicks at 42% and 19%, respectively.
Total site visits from organic searches fell 11% in Q4 2019, down 13 percentage points year over year and down 2 percentage points further from a 9% decline in Q3 2019, led by a decline in phone, tablet and desktop organic searches. According to Merkle, advertisers are seeing higher click-through rates for paid brand keywords instead of organic searches, perhaps suggesting more strategy is being placed behind paid SEM instead of SEO in recent quarters.
Despite a decline in organic search visits, Google continued to produce the most visits in Q4 2019 at 92% of all search visits. Yahoo and Bing’s share both declined, while search engine DuckDuckGo increased to 0.8% from 0.5% year over year.
Spending for Amazon Sponsored Product ads continues to accelerate (63% from 35% in Q3) despite a leveling out of cost per click (15%), with actual clicks increasing to 42% after a year of smoothing or declining percentages. Spending and clicks for Amazon Sponsored Products sharply decreased in early 2018 after many advertisers looked for a higher ROI on the Amazon ad platform, according to Merkle.
Meanwhile, spending on Amazon’s Sponsored Brands ads grew 56% year over year, up from 20% growth in Q3. Similar to Sponsored Product ads, advertisers have been working to increase their return on investment (ROI) for Sponsored Brands ads across the last two years, which caused spending growth to decrease despite sales growth remaining steady, according to Merkle.
Sponsored Product ads accounted for the bulk of Amazon advertising investment. 79% of spending by advertisers was used to promote products instead of brand or display ads in Q4.
Despite product detail pages having more impressions, top-of-search placements for Sponsored Product ads were more important to advertisers in Q4 2019, as they were responsible for 53% of spending by advertisers and generated 58% of sales. Top-of-search placements for Sponsored Product ads accounted for only 49% of spend in Q3 2019 and only 39% of spend in Q4 2018.
Despite being down quarter over quarter, YouTube ad spend is still seeing better growth than other social channels, including Facebook and Instagram. In Q4 2019, YouTube ad spend increased 43%, down from 87% in Q3. Impressions for the video hosting platform were down, growing only 6% in Q4 compared with 18% in the previous quarter. Cost per thousand (CPM) impressions increased 35% in Q4, also down quarter over quarter from 58%.
In contrast, Instagram ad spend increased 38%, down from 44% growth in the previous quarter. Impressions for the Facebook-owned platform rose 29% year over year and average cost per thousand (CPM) impressions increased 7%. Facebook spend increased 15%, impressions fell 5% and CPM increased 20%.