The research found that overall digital ad spend for H1 2018 is now £6.3bn, a 15% YoY growth. Half of the that total digital ad spend (£3.3bn) is on Search - which has also a growth of 15% YoY.
The growth in the overall digital ad spend is not surprising . As ad-tech continues to improve and the ability to measure more accurately and in more details increases, it becomes easier for marketers to correlate ad spend to revenue generated.
Mobile also continues plays an important role in the increase. The IAB UK’s chief digital officer, Tim Elkington, said:
"With mobile devices accounting for 75% of all UK adults’ time online, it is safe to assume smartphone penetration continues to contribute towards the 15% year-on-year growth in digital ad spend reported.”
The 15% YoY growth in spend on Search Marketing is equally unsurprising (although working in PPC, I would say that!). In fact spend on search has more than tripled since 2008.
I believe a key reason for this is that in most attribution models Search Marketing is often seen as the main conversion driver, especially when compared to other channels such as display. Most last-touch attribution models will feature Search highly.
If you think about it this makes sense - a prospect notices your advert on an industry publication -> they visit your stand at an expo -> they read a review of your product -> they visit your website via Google. In a last-touch model is looks as if search has done all the heavy lifting, when that may not be the reality.
This can lead to the misconception that if you increase search spend, you will linearly increase leads - which is usually not the case.
This is why it is important to take into account the whole sales funnel and other attribution models when deciding channel budgets - especially the channels driving awareness but with fewer conversions. And that's coming from someone who works in PPC!
Interestingly, it is not only Google Search spends that are increasing - Amazon has also reported increase in search revenue.
“Globally [Amazon] reported $2.2bn in ad revenues in Q2, a drop in the ocean compared to Google, but far greater than others – like Snap - competing for ad spend,” said MacLaggan. “This is nudging up overall spend on Search, as evidenced by the IAB results, as well as nibbling into Google’s share of the pie.
“It’s easy to see why advertisers are flocking to Amazon – its Prime service is now used by a third of all UK shoppers,” he continued. “That’s a huge audience and it’s worth paying for prominence by serving sponsored product listings, which appear at the top of users’ product search results on Amazon.
Whilst this may be is more B2C and not B2B but It would be interesting to see the split in advertiser spends in these verticals overall.
Overall, it's great to see Search spend increasing - whilst it may not always be as conversion-driving as many believe, it's still a hugely important channel for any marketing and sales funnel.
If you require help with your Search and PPC marketing, or if you would like a free PPC audit, get in touch at firstname.lastname@example.org.
The IAB UK’s chief digital officer, Tim Elkington, said: “With mobile devices accounting for 75% of all UK adults’ time online, it is safe to assume smartphone penetration continues to contribute towards the 15% year-on-year growth in digital ad spend reported.”