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Google in Q2: mobile, PLAs, competition on the rise

Published: July 15, 2014

Author: Joe Kerschbaum

At 3Q Digital, we ran numbers for both standard search campaigns and PLA campaigns, totaling almost 280M impressions, to compare Google’s quarter-over-quarter numbers (Q1 and Q2 2014) in advance of Thursdays’s earnings call. What we found in both standard and PLA campaigns: seasonality and increased competition served to raise CPCs and costs, but conversions aren’t keeping pace.
The statistic that jumped off the page most for us was PLA CPC, up 23.1% from Q1 to Q2 (.50 compared to .62). This, combined with conversion rates for PLAs lowering slightly from 3.01% to 2.91%, resulted in a 27.7% rise in PLA CPA. Increased competition is certainly a factor here as PLA adoption has become more widespread; the numbers may also serve as a harbinger that Google Shopping campaigns, which are being phased in and will completely replace PLAs by the end of Q3, may struggle to maintain comparable PLA performance #s.
More takeaways: mobile continues to eat into the overall share of search traffic, at 23.37% in Q2 compared with 20.51% in Q1 (for a 12% increase in share). Mobile CTR improved 7.85% (from 2.28% to 2.48%) while tablet and desktop CTRs were generally static, and mobile CPC and costs rose 20.31% and 24.08%, respectively, without corresponding improvements in conversion rate.
Overall, the effects of increased competition in both mobile and PLA campaigns were clear in Q2, which made life tougher for performance marketers but should reflect well on Google’s revenue figures in the upcoming report.

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