Costs Per Click Falling Around The World But Paid Online Traffic Continuing Rapid Growth

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Google continue to dominate the online advertising marketplace and David Twigg of OMC says there are signs of a status quo developing though he feels Australian trends are out of whack with the US.

the marketplace is evolving into the mainstream where battles are being fought to maximise ROI. That's why we are focusing as much on conversions for our clients as we are traffic generation

According to a report just published by RKG, Google search spend grew by 29% year on year by the end of June 2012. The report found that ppc advertising costs had fallen by 6% year on year but the number of paid clicks increased by 37%. RKG's report was based on surveying their own clients which include 30 of the top 500 ecommerce operators so whilst not being a definitive online marketing guide it is fair to extrapolate similar metrics to the world of online advertising as a whole.

Some further interesting metrics to come out of the report were:

For the Google adwords advertsing platform, costs per click fell 10% year on year.

For Yahoo and Bing combined, costs per click increased by 12% year on year.

Across platforms Tablets outgrew mobile in terms of paid clicks,tablets now contributing 57% of mobile device paid clicks.

Google's share of organic traffic grew slightly to 77%, Online marketing specialist,David Twigg of OMC said "This report was very US centric and certainly doesn't mirror the Australian market, but the most interesting trend overall is the status quo in the market. Online advertising is maturing into a more stable environment where forward thinking businesses are allocating budgets. Whilst the technology is very dynamic the marketplace is evolving into the mainstream where battles are being fought to maximise ROI. That's why we are focusing as much on conversions for our clients as we are traffic generation."

Google are widely reported to have a 94% search engine market share in Australia so that is a fundamental difference with the US market, and there has been very little published study,tracking costs per click but Twigg gives his view "I think costs per click are definitely rising on the Google adwords platform. That's not to say that we aren't lowering them for some new clients but the level of competition seems to be increasing which will always raise prices in an auction based system. The amount of poorly implemented adwords campaigns seems to be rising however so often the competition is quite weak."

Google recently reported their Q2 financial results giving a read on the worldwide market. They beat expectations on the back of a year on year reduction worldwide of CPC's by 16% as their paid clicks rose by 42%.

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Gwenn Doria - PA to David Twigg
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