UK Retail Spending in Paid Search Rises 24%; Amazon, Apple & John Lewis Lead

Spending on paid search advertising by retailers is on the rise in the United Kingdom, according to new research by AdGooroo, a Kantar Media company.

AdGooroo examined Google.co.uk Desktop Text Ad activity on the top 250 retail product keywords (ranked by ad spend) and found that advertising spending on the keyword group increased by 24% year over year, from £21.6 million spent from January through June 2015 to £26.7 million spent during the same period this year.

Competition remained relatively flat, with the number of advertisers sponsoring the keyword group growing by 1.3% year over year, from 6,531 advertisers in 2015 to 6,616 advertisers in 2016.

A Diverse Mix of Top Advertisers

UK Retail Top Advertisers H1 2016

Online retail giant Amazon led AdGooroo’s ranking of top advertisers by ad expenditure during the period, spending £891,000 from January through June on 216 of the 250 retail product keywords we examined. The next closest advertiser in the ranking was Apple, with £508,000 spent on just 28 keywords, followed closely by department store John Lewis (£505,000), telecommunications company O2 (£476,000) and another telecommunications provider/mobile phone retailer Carphone Warehouse (£474,000), a part of Dixons Carphone. (Another Dixons Carphone brand, home electronics and appliances retailer, Currys, ranked 16th with £239,000 in spend.)

The Top 20 retailers on the keyword group represent a mix of traditional retail industries, including mass retail, apparel, home improvement, consumer electronics and jewelry. However, five of the Top 20 advertisers actually belong more properly to the telecommunications industry, including O2, Carphone Warehouse,  EEThreeVodafone and Tesco Mobile (which is partnering with O2 on its mobile service offering).

Mobile Phone & Apparel Terms Top the Ranking

As indicated above, the keywords examined in this study are a ranking of the top 250 retail product keywords based on Google.co.uk desktop text ad spend from January through June 2016.

UK Retail Top Keywords H1 2016

The presence of so many telecommunications companies at the top of the retailer ranking is due to the fact that mobile phone terms are among the top retail keywords in paid search in the UK and court a diverse range of advertisers, including device manufacturers like Apple and Samsung, consumer electronics advertisers like Currys, mass retailers like Amazon and price comparison sites like Uswitch.com, as well as telecommunications providers.

In fact, eight of the Top 20 retail product keywords are related to mobile phones, including the #1 and #3 keywords, ‘iphone 6s’ and ‘samsung galaxy s6’, which generated £956,000 and £773,000, respectively, during the first half of 2016. Non-branded mobile phone keywords in the ranking include ‘mobile phones’ (£592,000) and ‘mobile phone deals’ (£300,000).

What’s more, there were 12 mobile phone keywords in total in the Top 250 retail product keywords, which accounted for £4,505,603 or 16.85% of total spend across all 250 terms from January through June.

UK Retail Top Keyword Categories H1 2016

However, apparel & accessories keywords were the dominant category among the Top 250 retail product keywords, with 86 apparel terms generating £6,678,356 in paid search ad spend during the first six months of 2016, or 25% of the total spend across all 250 terms. Breaking down the apparel category, 13.64% of spend was devoted to general apparel & accessories terms, while terms related to special occasion dresses accounted for 11.34% of total spend. There were three terms related to special occasion dress in the Top 20 keywords: ‘prom dresses’ (£417,857), ‘wedding dresses’ (£337,367) and ‘bridesmaid dresses’ (£266,849).

The home improvement category generated a total £1,910,862 during the period, representing 7.15% of total spend across all 250 keywords. The bulk of this total came from four home improvement keywords that ranked among the Top 20 terms, including ‘conservatory’ (£486,915), ‘windows’ (£476,748), ‘double glazing’ (£415,042) and ‘garden furniture’ (£385,115),

The remaining keywords in the Top 20 ranking were ‘engagement rings’ (£847,667), ‘business cards’ (£633,708), ‘flowers’ (£373,414), ‘catalogues’ (£352,429) and ‘contact lenses’ (£310,849).