Report: Tablets Yield 15% Lower RPC Than PCs; (Another) Rebuttal To AdWords Tablet/PC Combo

The proliferation of tablet devices has begun to lower the value of the tablet segment overall for paid search marketers, even as competition heats up. That’s according to the Q1 Digital Marketing Report by RKG, which finds that tablets generated 15% lower revenue per click than traditional computers.

Revenue Per Click by Device Type vs Computer

“Discrepancy is More Likely to Increase”

Much has been made of Google’s decision to combine tablets and PCs in enhanced campaigns. The RKG  report is not alone in challenging Google’s claim that usage behavior and ad performance among the devices are similar.

RKG’s authors predict the “discrepancy [between tablets and computers] is more likely to increase than decrease in the near future, despite assertions that the two are blurring together”.

Even among tablet devices, the report finds significant performance variances: “Android tablets generate considerably worse RPC than the iPad, degrading the value of the tablet segment”. And yet, RKG says the iPad’s value of traffic appears to be declining as well as its customer base expands. The strong performance of Windows 8 RPC shown in the chart below is “possibly reflecting an early adopter boost the iPad once enjoyed”.

Rising Mobile CPCs & Spend

The RKG data also points to a trend in rising mobile CPCs. Just prior to Google’s enhanced campaigns announcement, RKG says its clients saw a “distinct jump” in mobile CPCs (both tablet and smartphone) relative to computers, and they have remained elevated.

Mobile CPC As Percentage of Computer by Week

RKG says that these increases don’t reflect the transition to enhanced campaigns by RKG clients, as they were only conducting limited tests, “but it may be an early indication of a change to the competitive landscape”. This echoes Covario’s Q1 conclusions that advertises will see increased competition for mobile-device advertising with enhanced campaigns.

The RKG report found tablet ad spend rose 162% and smartphone spending increased 190%. For the first time, RKG found total desktop and laptop search traffic fell year-over-year, dropping 0.7%. Mobile searches made up for the loss and more, leading to 15% increase in overall click growth.

Overall, it appears Q1 ushered in a new competitive reality for PPC advertisers. And RKG concludes its “data suggests advertisers may face challenges maintaining their current levels of efficiency”.