iProspect: 2016 mobile CPCs up 26 percent, Shopping spend up 41 percent

The agency expects to see mobile CPCs rise and CTRs fall as competition and impression volume increase in 2017.

In its quarterly Paid Search Trends report, digital marketing agency, iProspect, says 2016 was “the year of efficient growth” for paid search.

It was a year in which click volume rose and cost per click (CPC) went down. Overall, impressions rose 19 percent, clicks were up 15 percent in 2016 among iProspect clients measured in the report. Click-through rates (CTRs) remained steady against 2015 for the first three quarters of the year, then fell with the increased holiday competition in Q4, bringing the overall CTR off 3 percent compared to 2015.

For the first time, iProspect clients saw mobile ad clicks surpass desktop clicks in 2016, with 52 percent of clicks coming from mobile devices.

Moible & Shopping Ads Drive Q4 Trends

iProspect says the largest impacts on Q4 performance were a 41 percent spend increase in Shopping ad CPCs and a 26 percent year-over-year CPC increase on mobile ads. iProspect expects to see these trends continue in 2017.

Shopping

Between Thanksgiving and Cyber Monday, Shopping ad clicks jumped 55 percent, and conversions from those ads increased 9 percent compared to 2015. Throughout the holiday shopping season, iProspect clients saw shopping ad impressions increased 76 percent year over year, and clicks rose 44 percent.

Interestingly, Shopping CPCs dipped slightly in Q4. iProspect does not expect that to hold, however, particularly as Amazon has entered the Google Shopping arena.

In 2016, 61.3 percent of Shopping ad clicks among iProspect clients came from mobile devices, compared to 49.9 percent in 2015.

Mobile

On mobile, impressions increased by 80 percent, while clicks were up 25 percent year over year. Mobile click-through rates fell by 31 percent compared to 2015. CPCs on mobile reached an all-time high in Q4.

Mobile CPCs continued to close the gap with desktop and tablets, and in Q4, mobile click share reached 57 percent.

Mobile click share and spend will continue to grow, and click-through rates will dip as impression volume rises in 2017, expects iProspect.

On the Shopping front, iProspects expects Google’s continued efforts to develop new features and formats for Product Listing Ads and new measurement tools will lead to increased investment in Shopping and higher CPCs.

With Amazon’s entry into PLAs in Q4, advertisers should regularly check Auction Insights reports to monitor whether the e-commerce giant is impacting campaign performance.