In their 2nd Annual U.S. Mobile Path to Purchase Study, xAd and Telmetrics concluded that consumers are reaching for their smartphones and tablets earlier and more often in their search for local goods and services. They also found that key factors like local relevancy and promotions highly influenced consumers’ purchase decisions.
Mobile Used Early & Often
The study reports 45% of consumers that are searching for local products and services will reach for their mobile device first when starting a search, and 49% will use a desktop device. However, when it comes to the mobile user, 54% of all mobile users will look to an additional media source at some point in their purchasing process, while the remaining 46% will use their mobile device as their sole primary search tool.
Additionally, it was found that half of mobile users will use their device at the start of the search process with 1 out of 3 using their mobile device throughout the entire process.
Mobile Conversions Impacted by Device and Location
Local relevancy was a top motivator for consumer purchase selection, as 1 in 3 smartphone users and 1 in 4 tablet users utilized their devices to search specifically for contact information such as an address, phone number, or driving directions. The study also concluded that 60% of mobile users expect businesses to be within walking distance or a 5 mile driving radius.
Mobile users who participated in this study were found to have high purchase intent with 60% of smartphone users and 53% of tablet users completing purchases related to their mobile search. 74% of smartphone users completed transactions offline or in-store, while 54% of tablet related purchases were made online through a mobile device or PC, and 22% of mobile users completed transactions directly through their mobile device.
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Since her arrival as Chief Executive Officer to Yahoo, Inc. almost a year ago, Marissa Mayer has been struggling to end their 10 year search deal with Microsoft, which started in 2010, for a more lucrative partnership with search giant and former employer Google, but Microsoft has no intentions of letting Yahoo out of their deal.
Under the terms of their contract, Yahoo is obligated to utilize Microsoft’s Bing search engine for search Yahoo Bing search dealresults on Yahoo sites. Yahoo and Microsoft also have a revenue guarantee which expired and was extended for an additional 12 months (U.S. only) on March 31, 2013.
This arrangement allocates 12% of the revenue received from Yahoo’s search advertisements to Microsoft. In return, Microsoft guarantees Yahoo a set amount of revenue for every search query made on a Yahoo site. Although Microsoft’s revenue guarantee is worth $12-$15 million a quarter, according to the Wall Street Journal, Yahoo’s revenue per search has been its worst since they partnered with Microsoft.
In February, Mayer said the partnership between Yahoo and Microsoft was not delivering. “One of the points of the alliance is that we collectively want to grow share rather than just trading share with each other,” Mayer said at the Goldman Sachs Technology and Internet Conference in San Francisco.
In a recent regulatory filing, Yahoo disclosed their desire to terminate their arrangement with Microsoft, but will either have to wait until 2015 (the halfway mark of the contract), the sale of Bing to another company by Microsoft, or revenue-per-search dipping below their agreed threshold to make any moves.
If Yahoo and Google do eventually partner, this partnership could have a tremendous impact on search as we know it.
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In Kenshoo’s recent Global Search Advertising Trends report, it was found that global paid search ad spending continues to rise. So much so, that year over year growth for global paid search ad spend in Q1 2013 reached 15%, and in the U.S. alone paid search ad spending grew 24%. A majority of the increases in paid search ad spending can be justified by the fact that consumers are increasingly looking to their smartphone or tablet for search and purchases instead of their laptop or desktop, which has forced marketers to invest a greater portion of their ad spending into mobile.
Kenshoo also found that in the U.S., there is a significant gap between paid search ad spending and distribution of clicks. In Q1 2013, tablets and smartphones accounted for 20% of paid search clicks but only accounted for 14% of total paid search ad spending. Smartphones in particular accounted for 9% of paid search clicks, but only made up 5% of total paid search ad spend.
In the U.S., desktop search still commanded the most ad spend and clicks by a healthy majority at 86% and 81%, respectively.
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