Tablet users are proving to be more engaged and more valuable consumers for advertisers to reach compared with PC users, according to a new report from IgnitionOne.
The Q3 2012 Online Advertising Report found that tablet users spend 30 percent more time on sites and have a 20 percent higher engagement rate than PC users. However, while campaign results are strong for tablets, the report also found that advertisers spent less on mobile and tablet advertising in the third quarter than they did in the previous quarter.
“We were very impressed by how much more engaged tablet users are when compared to PC and smartphone users,” said Roger Barnette, president of IgnitionOne, New York. “They not only spend more time on site and have more page views, but they also have a higher engagement score.
While the spend on mobile search advertising continues to grow, the pace of growth has slowed since the first half of the year.
Mobile and tablet search advertising saw a year-over-year increase in spend of 167.5 percent in the third quarter. This number is half of the previous quarter’s year-over-year growth.
“While a growth in spend of 167.5 percent is less than the last two quarters, this is still a huge number,” Mr. Barnette said.
“The quarter was pretty lackluster across the board, but we expect the fourth quarter to see big gains in every area – including mobile,” he said.
During this period, mobile accounted for 16.3 percent of total search budgets, up from 14 percent.
Tablet devices accounted for 52.2 percent of the total mobile search advertising budget for the quarter, which is down from 60 percent in the last quarter.
The results point to the importance of reaching the tablet audience given that these users deliver higher engagement levels and spend more time on sites compared to PC users. The levels are even higher for the retail vertical.
The report also points to the challenges in reaching smartphone users, even though they are a larger audience compared to tablet users.
For example, 60 percent smartphone users do not allow themselves to be tracked compared to seven percent of tablet users and 18 percent of PC users.
Additionally, the engagement levels for smartphone users are lower, reflecting the slower speeds and smaller screens on smartphones.
Smartphone users had on average a four percent lower engagement level than PC users and 11 percent fewer page views.
Mobile and tablet users accounted for 18 percent of the traffic across the sample sites reviewed for the report, with the large majority being smartphone users.
While the results suggest that tablet users are a better investment for advertisers, there are still opportunities to reach smartphone users based on the large size of the audience and the lower average CPC for smartphones compared to tablets.
Overall, paid search spending grew 17.8 percent in the third quarter compared with the same period a year ago but flat compared with the previous quarter, with growth affected by a weaker-than-expected back-to-school shopping season and continued weakness in the economy.
The report also found that Google’s CPCs grew for the first time in 2012, up 7.7 percent. However, Yahoo!/Bing saw CPCs increase at 26.1 percent.
Going forward, IgnitionOne expecting tablets to continue to drive growth of online advertising.
“We found it interesting that tablets also had a smaller percentage of users who adopted ‘do not track’ settings compared to PC users,” Mr. Barnette said. “Mobile had the highest percentage of users who adopt do not track at 60 percent.”