Mobile search ads appear to be working very well, indeed.
Google data suggest people who have clicked on mobile-search ads spend more money in stores than those who click on desktop search ads. In fact, a third of retailer Target’s mobile-search ads “led to a user visiting one of its stores during the 2014 holiday season,” according to a recent story by Alistair Barr posted by Nasdaq.
“Google Inc. says it is doing a better job connecting purchases in stores with ads the shoppers saw on smartphones, prompting some advertisers to boost spending on mobile ads,” notes Barr. “Hundreds of retailers in the U.S., Canada, and Australia now see regular reports on store visits that follow clicks on Google search ads. A smaller group that includes Target Corp. and Home Depot Inc., two of the largest U.S. retailers, get the purchase data.”
The retailers confirm mobile search ad effectiveness.
“We know from Google’s store-measurement data that our mobile search ads greatly influence in-store sales,” said Kristi Argyilan, a Target senior vice president.
“The favorable reaction from advertisers could help Google tackle a big challenge: the lower prices of mobile-search ads,” writes Barr. “Marketers have been cool to mobile ads, because they think fewer users take the trouble to complete purchases on phones. If Google can show that many of these users later buy items in stores, that could lift the prices of mobile ads, which tend to be about half the price of desktop ads.”
Mobile search — and the prices paid — are growing. For instance, digital marketing agency Merkle RKG notes that its clients paid 23 percent more for mobile-search ads on Google in the first quarter of 2015 compared the same period in 2014.
Jerry Dischler, a Google product manager, says advertisers are spending more on mobile because they see more impact in their stores.
“They were valuing offline at zero and now they are valuing it at more than zero,” Dischler said.
That’s backed up by recent stats from consulting firm Deloitte. The firm estimates that 28 percent of sales in physical stores, or $ 970 billion, were influenced by mobile devices last year, up from 5 percent in 2012.
To connect store purchases to its ads, Google works with data companies including Acxiom Corp., the Epsilon unit of Alliance Data Systems Inc., and Oracle Corp.’s Datalogix.
How does it work?
“When a shopper clicks on a search ad, small bits of software called cookies are placed on the phone’s Web browser,” explains Barr. “Acxiom’s LiveRamp unit often can match the cookie to a user’s email account, which the user may have registered with other websites that work with LiveRamp. Once that connection is made, store purchases can be tied to these email addresses, and associated account information.”