The IPA's Search Group has today published an update of their search brand terms analysis to reveal A consistent set of data, from January 2008 to March 2009, submitted by 12 agencies on 47 brands shows that
Average Click Through Rates declined from around 40% to around 20%, whilst average Cost Per Click increased from 6p to 29p, during January 2008 to March 2009, according to new findings from the IPA.
It marks a continuing trend of declining CTR on Google in paid search advertising but with increasing cost per click CPC.
The findings are based on data gathered from 12 agencies on 47 brands.
According to Rob Taylor, Search Director, BLM Quantum, the findings reveal a four-fold increase in Brand CPCs in just over 12 months.
“This may be a reflection of the fact that brand terms are becoming more competitive in line with a decline in the economy,” he added.
“As search is so measurable, clients are beginning to realise that competitive bidding generates positive ROI, even though the quality score is against them and CPCs are high.”
Taylor went on to say it was important to remind clients to defend brand terms, but also to consider their competitive position as rivals might also be pitching to their customers at the same time.
“It is also possible that SEM agencies are modifying their brand bidding strategy and chasing volume/efficiency rather than trying to net as many clicks as possible,” he concluded.
Chair of the IPA Search Council, and CEO, iCrossing, Arjo Ghosh, said that Search was still is a very effective way of getting people who are looking for a brand to the corrcet site.
“The rising costs perhaps signify that we are becoming victims of our own success and that the market is just developing naturally and finding its point,” he added. “The declining CTR challenges the notion that Google's trademark change was in order to benefit the user. “
“To understand the full picture it would be good to see an analysis of user behaviour in paid and natural search to get a fuller understanding of what’s happening here. Data like this often poses more questions than it answers and we look forward to continue our engagement with Google on this. ”
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