Mobile paid search spend, clicks, impressions, CPCs and CTRs for Performics' aggregate client base. Insights into mobile paid search's exponential growth.

1. Performics Mobile Paid Search Benchmarks & Trends
(Q1 2012)
1

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
2
* 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
3
* 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
4

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
5
* 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
6

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.
7

8. With Low CPCs, Mobile Is Still a Buying Opportunity
 Tablets CPCs are 85% of
desktop CPCs
 Smartphone CPCs are 55%
of desktop CPCs
8
* 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
9

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%
10
* 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.
11