With Memorial Day and the traditional start of the summer travel season just a few days away, it’s a great time to look at the Travel industry and Paid Search. Specifically, how are things faring and what might we expect to happen this summer?

Travel's Down -- What's Up?

Paid search spend in the Travel category on U.S. AdWords is down in 2013, at $238 million for the months of January through April down 19% from 2012’s $295 million which was down 17% from 2011.

Clearly, there’s a downward trend starting in 2011. And the trend holds throughout the summer months as well, with spend from May through August 2012 down 15% from the same period 2011. If the trend continues, then we estimate the spend this summer will total only $242 million, more than $100 million less than two years ago.

Have travel marketers en masse decided to pull back on their paid search spend? Not according to our data. For instance, we found 217 advertisers in the travel category on U.S. AdWords in Q1 2012 and 228 in Q1 2013.

Another possible explanation could be the so-called "stickiness" of travel sites, which may be better retaining users that have had a previous good experience.

However, a more plausible explanation is that Google has been cannibalizing its advertisers’ clickthroughs and spend with their own travel marketing efforts. After all, the decline in PPC spend began in 2011, a year in which Google Flight Search and Google Hotel Finder launched (in September and August, respectively). It would not be a stretch to conclude that the presence of these new Google features--the travel equivelant of their Product Listing Ads--in the first SERP results may be poaching large amounts of clickthrough traffic (and thus PPC spend) from the paid ads on the page.

Top Travel PPC Advertisers of 2012

With the vast majority of travel bookings now taking place online, Travel is a highly competitive category for paid search. Based on PPC-generated impressions, the Top 10 paid search advertisers on U.S. AdWords in the Travel category in 2012 were:

1. kayak.com – 883 million impressions
2. priceline.com – 699 million impressions
3. orbitz.com – 670 million impressions
4. tripadvisor.com – 663 million impressions
5. cheapoair.com – 629 million impressions
6. expedia.com – 595 million impressions
7. booking.com – 538 million impressions
8. travelzoo.com – 469 million impressions
9. bookingbuddy.com – 353 million impressions
10. hotels.com – 349 million impressions

Interestingly, the category is led by kayak.com, a company that just a few short years ago seemed to occupy the status of ‘best kept secret’ among those in the know on travel deals. Also of note, the better known brands (Priceline, Orbitz, Expedia) are competing not just with each other but with lesser known sites such as cheapoair.com and bookingbuddy.com. Perhaps in a few years these brands will occupy a similar position to kayak.com today?

Enterprise Boldly Goes Where No Travel Keyword Has Gone (This Year)

The following chart shows the Top 25 keyword terms in 2013 based on January to March clickthroughs and their change in click-through rank from the same period last year:

In a surprise, it appears that this summer’s new Star Trek film is not the only place to find a popular ‘Enterprise’. The car rental giant’s branded keyword term leads the entire Travel category in 2013 clickthroughs, moving up from the number 4 position in 2012. What’s more, our research showed that the Enterprise keyword enjoys a remarkable 12.1% clickthrough rate. The leader on this metric was Expedia, with a 29.5% CTR, meaning that almost one third of the time that a paid ad for Expedia appeared on a Google SERP, that ad was clicked on.

Overall, navigational/branded keywords (search terms for a specific site, which signal the desired site destination as opposed to a search for information) tended to perform well in 2013. Other navigational keyword search terms that excelled in 2013 include: “Travelocity”, up 7 positions; “US Airways”, up 15 positions, “Trip Advisor”, up 8 positions as well as“Hotels.com” and “Best Western”. A notable exception were the keywords “Southwest” and “Southwest Airlines”, which both slipped in the ranking.

Among non-navigational keywords, big gainers include “rental cars” (up 20 positions) and “cheap hotels” (up 17 positions) while those losing ground included “Disney”, down 12 positions (though “Disney World” climbed slightly).

Random Observations on the Top 100

The following insights were derived from examining the Top 100 Most Clicked Keywords:

• The growing popularity of the keyword “vrbo” (vacation rental by owner), which rose to position 51 in 2013 from 78 in 2012, may indicate a new trend in consumer travel habits and a threat to the hotel business
• Average clickthrough rate was 8.1%, with navigational terms posting much higher rates and generic terms yielding much lower clickthroughs (“flight” was lowest at 1.4%)
• Queries on “Airlines” yielded the most paid ads: 10.6 per SERP, while searches on “Greyhound” yielded less than 1, on average
• “Hyatt” got the highest ad coverage (appearing 95.2% of the time) while “United Airlines” got the lowest (37.7%)
• “Vacation packages” was the term with the most bidders, with 259 advertisers gaining first SERP impressions during the first quarter of the year. “Greyhound” had the fewest bidders (4).

Consumers Searches

Returning to a subject we covered last year the word cloud below depicts consumer search activity on US AdWords during the months of January to March 2013, when many individuals are starting their travel planning for the summer. The size of a keyword is in proportion to the number of paid search ad impressions (Top 25 keyword terms based on resulting ad impressions) which were served on Google’s first SERPs during that period.

Evidently, travel searches are equally dominated by informational searches (particularly by people seeking low cost lodging and transportation options) and navigational searches (people using Google to get to a specific carrier or operator’s website). Searches on generic terms trigger ads from multiple competitors, which explains the relative size of “hotels”, “flights”, “cruises” and “cheap tickets” and “cheap flights”, each of which provoked tens of millions of ads (literally) during that period. The navigational searches on branded terms like “Disney”, “Travelocity”, “Enterprise”, “Southwest” and “Royal Caribbean” trigger many fewer ad impressions since Google discourages bidding on competing brands, and so the number of ads per SERP is much lower than for generic terms.

According to the National Retail Federation, consumers plan to spend $2.3 billion on flowers for Mother’s Day this year, making Mother’s Day the top holiday for flower purchases—even over Valentine’s Day at $1.9 billion.

What’s more, the NRF reports that nearly 3 in 10 Mother’s Day gift buyers will be heading to the Internet to make their purchase.

So how are paid search marketers in the Flowers & Mail Order Gifts category responding? If recent trends hold up, then 2013 will be the biggest year on record for paid search spending related to Mother’s Day. Advertisers in the Flowers & Gifts category spent $5.6 million on paid search in May 2010, $8 million in May 2011 and $9.4 million in May 2012, according to AdGooroo’s proprietary data collection and modeling. If this growth pattern continues, then paid search by advertisers in the Flowers & Mail Order Gifts category will exceed $11 million this month.

A Robust & Innovative Category

Flowers & Mail Order Gifts is a robust sector for paid search. According to AdGooroo data, the Flowers & Gifts category ranked ninth among Shopping and Retail categories in terms of paid search spend, accounting for more than $75 million of paid clickthroughs on U.S. AdWords and more than $8 million on the Yahoo! Bing Network during 2012. AdGooroo found more than 450 advertisers active in this vertical on AdWords and more than 250 active on Yahoo! Bing during the year.

Interestingly, the retail florist trade is responsible for some important marketing innovations that are now pervasive and almost taken for granted by retailers of all kinds. For instance, 1-800 Flowers was one of the first U.S. retailers to use a 24/7 toll-free number for accepting orders, while FTD (Florist’s Transworld Delivery, founded in 1910 as Florist’s Telegraph Delivery) was the first organization to form a national network of local operators across the country to enable same-day delivery. One hundred years later, Amazon Locker is replicating this innovation by installing self-service locker kiosks in convenience stores (currently in Seattle, New York and London).

The Top 10 Paid Search Advertisers

Competition for first SERP ad impressions and clickthroughs in the Flowers & Mail Order Gifts category is fierce as old stalwarts bid against newcomers for top page position and the resulting clickthroughs and orders. Based on PPC-generated impressions, the Top 10 paid search advertisers on U.S. AdWords in the Flowers & Mail Order Gifts category in 2012 were:

1. Pro Flowers – 134 million impressions
2.1-800 Flowers – 125 million impressions
3. FTD – 96 million impressions
4. Gifts.com – 90 million impressions
5. BloomsToday.com – 85 million impressions
6. Teleflora – 83 million impressions
7. FromYouFlowers.com – 73 million impressions
8. FloristExpress.net – 56 million impressions
9. UncommonGoods.com – 55 million impressions
10. JustFlowers.com – 51 million impressions

Top Keywords

This word cloud depicts the most common search queries, sized in proportion to the number of paid search ad impressions served by US AdWords last year:

There were some shifts in the popularity of search queries, and thus of ads served from 2011 to 2012. Here are the Top 25 keyword terms in 2012 and their change in rank from 2011:

Among the big gainers were “mothers day gifts”, “fruit baskets” and “flowers for mothers day”. Notably, “edible arrangements” moved into the Top 10, showing the growing popularity of the Edible Arrangements retailer and suggesting that gift givers may be starting to explore options other than the predictable flower bouquet. If this trend continues in 2013, this would be very good news for all merchants whose gift catalog extends beyond flowers such as Harry & David and UncommonGoods.com.

Want to see the Top 50 paid search advertisers in 15 retail categories? Get the full report here

Chicago, IL, March 19, 2013 – Digital marketing intelligence provider AdGooroo (www.adgooroo.com), a Kantar Media company, today announced it has expanded its service for clients with the addition of search marketing intelligence data on the Yahoo! Bing Network, including estimated PPC spend, clickthrough rates (CTR), cost per click (CPC) and impression share/share of voice by keyword, ad and advertiser.

AdGooroo’s Yahoo! Bing Network search data, along with its Google AdWords data, is accessible to the company’s clients via its Industry Insight platform, an online marketing dashboard that provides advertisers with the abilities to:
• Mine competitors' keyword lists to uncover new traffic opportunities
• Study competitors’ ad copy, promotions and calls-to-action
• Quickly assess the competitive landscape and larger trends that may impact budgeting and performance in any vertical
• Gain immediate insight into any advertiser, including those too small to show up in panel-based datasets
• Compare any two advertisers across any time period by spend, clicks, CTR, CPC, ranking and more
• View historical/seasonal trends
• And more

In addition, AdGooroo clients can utilize the company’s Yahoo! Bing Network search data as part of its Custom Insight service, which delivers custom research and reporting to help clients answer specific business questions.

“We are pleased to expand our coverage of the search advertising market with the addition of Yahoo! Bing Network data,” commented Richard Stokes, founder and CEO of AdGooroo. “Providing our clients with search intelligence for Bing, Yahoo! and their partners is an important part of our goal to deliver the most complete picture possible of both our clients’ category and their specific search competitors.”

Coinciding with the availability of Yahoo! Bing Network data, the company has published a new report, Yahoo! Bing PPC Performance Metrics, which examines key search metrics for both Yahoo! Bing and Google AdWords across six industry verticals in the US during Q3 2012, including Retail, Financial Services, Travel, Education, Business to Business and Computer & Internet.

Among the report’s findings, Google AdWords was shown to be the leader in impressions and clickthrough rates. In fact, AdWords delivered significantly higher impressions in five of the six categories studied. This was especially so in the Retail category, where AdWords delivered 60 percent or more than 7 million more ad impressions than Yahoo! Bing during the quarter. In addition, average clickthrough rates on AdWords campaigns were 2 to 5 times higher than those on Yahoo! Bing in all categories studied during the period.

At the same time, the Yahoo! Bing Network was found to have costs per click that were 1 to 3 times lower than AdWords, as well as brand impressions that were 76 to 90 percent less expensive on average than AdWords. In addition, there was less competition for top positions on its results pages, with 36 percent fewer advertisers on Yahoo! Bing than on AdWords in the studied verticals.

“We believe AdGooroo’s study is a first of its kind and will help search marketers make informed marketing decisions,” commented Stokes.

About Kantar Media
AdGooroo is now a Kantar Media company. Kantar Media provides strategic advice and competitive intelligence to the world’s leading brands, publishers, agencies and industry bodies, helping them navigate and succeed in a rapidly evolving media industry. This includes analysis of paid media opportunities; counsel on brand reputation, corporate management and consumer engagement through owned media; and, evaluating consumers’ reactions in earned media. Kantar Media provides clients with a broad range of insights from audience research, competitive intelligence, vital consumer behavior and digital insights, to marketing effectiveness and online influence. Our experts currently work with 22,000 companies tracking 3 million brands in 50 countries. For more information, visit AdGooroo.com or www.KantarMediaNA.com.

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