Google search CPCs up 19%, pushing ad spend up 17%
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As the Google Search ad landscape witnesses an increase in advertiser investment, competition is intensifying, resulting in a rise in product costs.
In the United States, spending on Google Search ads experienced a significant uptick of 17% year-over-year during the last quarter of 2023. Concurrently, Google’s click growth remained stable at 8% year-on-year, while the cost-per-click (CPC) surged by 9% over the same period.
These statistics have been extracted from Tinuiti’s Q4 2023 Digital Ads Benchmark Report.
It’s noteworthy that the choice of device plays a crucial role in the dynamics of Google search ad performance:
Mobile search ads: Expenditure increased by 19% year-on-year, clicks saw a 10% boost, and the CPC climbed by 9%.
Desktop and laptop search ads: Spending rose by 15% year-on-year, click volume increased by 2%, but CPC showed a more substantial increase of 13%.
Tablet search ads: Spending grew by 4% year-on-year, but clicks decreased by 13%, while CPC saw a notable increase of 19%.
Performance Max (PMax) on the Rise: During the peak of the holiday shopping season in Q4 2023, a notable 91% of retail advertisers who ran Google shopping ad listings incorporated Performance Max campaigns into their strategies. This marks a substantial increase from the previous year when 80% of retailers had integrated PMax campaigns into their advertising efforts. However, it’s worth noting that despite a consistent uptick throughout 2023, the adoption of PMax campaigns appears to have reached a plateau.
Emergence of Temu as a Key Player: In the final week of 2023, a remarkable 90% of retailers recognized Temu as a significant competitor in Google Shopping auctions. This level of recognition is comparable to Amazon’s persistent presence over the past two years. Temu’s appearance in these auctions began in late 2022, and its visibility escalated notably during the first half of 2023, continuing to rise throughout the year.
About Tinuiti: Tinuiti is a prominent independent performance marketing firm boasting a workforce of over 1,000 employees and managing a substantial $4 billion in digital media.
Report Methodology: The Tinuiti Digital Ads Benchmark Report derives insights from anonymized performance data originating from advertising programs managed by Tinuiti. This data is drawn from active programs with consistent strategies. All figures presented reflect growth within the same set of clients and are not intended to officially represent the performance of any specific advertising platform or the experiences of every advertiser.