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Despite Deep Linking’s Rise, Search Is Still Set To Lose SMBs To Social Spending

App usage — coupled with greater outreach from Facebook, Pinterest, and Twitter — is driving local business marketing to native advertising formats.

BIA/Kelsey's Mike Boland
BIA/Kelsey’s Mike Boland

Search advertising dollars are projected to lose revenue share to social media channels, BIA/Kelsey reports, as the latter category has become firmly established as a mainstream platform for marketing by SMBs.

Smaller businesses in particular rely heavily on the likes of Facebook and Pinterest as the backbone of their public presence, notes BIA/Kelsey in its report,The Next Era of Search, which forecasts search’s current share of 50.4 percent this year to decline to 45.6 percent by 2019.

The report indicates that in their own respective ways, Apple, Google, and Facebook are all competing and reshaping a local marketplace that BIA/Kelsey now estimates to be worth $7 trillion — $2 trillion of which is comprised by mobile — as the practice of using deep linking is reforming the way businesses compete at the regional and neighborhood level.

SMBs’ Deep Dive Into Mobile

BIA/Kelsey reminds readers of its report that it had projected this trajectory back in 2012. But that was before deep linking, which directs a visitor to their desired page within a website, skipping the landing page in order to get them directly to the specific information they are looking for.

Apple’s iOS 9 has made it possible to search through its Safari mobile web browsers as well as through all the properties in its App Store library, with results showing its Spotlight results. While this is widely seen as Apple’s attempt to build up its App Store at the expense of browser-based Google’s search dominance, as we reported earlier, Google has expanded its indexing abilities to iOS 9 apps as well through deep linking.

But as apps become the preferred way consumers spend time on their smartphones — according to an Interactive Advertising Bureau study, consumers spend 88 percent of mobile internet time in apps versus a mere 12 percent browsing the mobile web — marketers’ spending will shift.

Local Share of Mobile Ad Spend By Format (Source: BIA/Kelsey)
Local Share of Mobile Ad Spend By Format (Source: BIA/Kelsey)

Deep Linking’s Not Decisive

As BIA/Kelsey hastens to add, the sky is hardly falling on SEO. But the change does highlight the changing direction of small business advertisers, just as they begin to ramp up their digital marketing.

“Though deep linking is a factor that will assist search’s revenue share, overall we’re seeing a clear decline in search query volume,” said Mike Boland, BIA/Kelsey senior analyst.This is simply because app usage far outweighs browser, and the latter is where search lives. The front door to connected experiences is more fragmented and siloed into different apps, meaning its not channeling through Google’s front door. That query volume is the foundation for search revenues.”

As we’ve seen with its moves to incorporate iOS 9 apps in its search index as well as the widening coverage being advanced in its Google Now app, Google will surely find ways to meet the challenge of the shift to apps and away from the browser, Boland added.

“But the underlying trend will still take a bite,” Boland said. “Meanwhile, native social is on the rise for the above reasons and will take some of that share. That’s why the numbers are the way they are.”

The reason this opportunity at the local level is important simply comes down to its size. Despite e-commerce’s attention, it only accounts for about 7 percent of U.S. retail spending, according to the U.S. Census Bureau. The other 93 percent happens offline — and nearly 100 percent of local services naturally happen offline.

Don’t Blame Ad Blocking

In any case, Boland adds that the current industry hot topic of mobile ad blocking won’t make much of a difference in browser-based advertising, a subject which Boland said he considers “overblown.”

“The share shifts [away from search] are all about how native social is becoming a higher performing ad unit, more aligned with the realities of the device and user preferences,” Boland said. “That can be seen in the massive growth of Facebook news feed ads and other developing in-feed native formats in Instagram, Twitter, Pinterest and others.

“Ad blocking might accelerate this shift, in terms of forcing lazy advertisers to innovate beyond traditional display and into more native formats,” Boland added. “But it’s not the main driver. The shift to native social is much bigger and deeply rooted than recent developments in ad blocking.”

About The Author
David Kaplan David Kaplan @davidakaplan

A New York City-based journalist for over 20 years, David Kaplan is managing editor of GeoMarketing.com. A former editor and reporter at AdExchanger, paidContent, Adweek and MediaPost.