Report Highlights 63% YoY Growth of Amazon Sponsored Products Ads, Contributing to a 106% Rise in Sales
Columbia, MD – Merkle (www.merkleinc.com), a leading technology-enabled, data-driven performance marketing agency, has released its Q4 2019 Digital Marketing Report (DMR), a quarterly benchmark report that analyzes and highlights key metrics and trends for both paid and organic search, social, and display. The report looks to identify key drivers in ad spend shifts for Amazon, Google, Facebook, and Microsoft. Merkle will also be presenting a webinar on Tuesday, February 4 at 1 p.m. ET to examine the results and outline key takeaways for marketers.
Overall, the DMR shows that spending growth for Google search ads remained steady at 16% year-over-year (YoY), yet some of the key drivers of Google spend have been shifting in recent quarters. After a stellar Q4 in 2018, Google Shopping ads are seeing slower growth, while other formats, such as Google text ads, are seeing accelerated growth. Many retailers also found success during the holiday season in reaching customers with Google’s Local Inventory Ad (LIA) format, which saw its share of Google Shopping clicks rise throughout the quarter and peak three days before Christmas. Similarly, clicks from Google Maps ads hit their quarterly high on Christmas Eve. Google also produced over 92% of US organic search visits in Q4 2019, while DuckDuckGo delivered 47% YoY growth in organic search visits overall.
Additional insights show that spending growth for Amazon Sponsored Products ads accelerated to 63% YoY in Q4 2019, as advertisers saw sales produced by the format rise 106%. Spending on Amazon’s Sponsored Brands ad format grew 56% YoY in Q4, up from 20% growth in Q3, accounting for 18% of Amazon ad spend.
“Quarter after quarter, we publish the Digital Marketing Report to help guide marketers in their strategic planning around where and how to invest their ad spend,” said Erin Hutchinson, chief marketing officer, Merkle Americas. “Q4 2019 was dominated by Amazon’s advertising. As we enter the new decade, we are interested in seeing what data these platforms will produce. Marketers will need to keep an eye out on who’s leading the charge for what’s next to come, to ensure they are making the right business decisions.”
Additional insights from the report reveal that Microsoft search ads rose 17% YoY, as clicks fell 10%. For Google, brand text ads appeared to be leading the charge for advertisers, with strong volume growth in the second half of 2019, as clicks rose 21% YoY in Q4 2019 alone. Although mobile continues to outpace growth for other devices, desktop Google search ads have also seen improving trends over the past year, with clicks rising for the first time in over two years, and spending rising 12%.
Examining paid social and display, the report shows that spending growth for Facebook ads, excluding Instagram, accelerated for the third quarter in a row, closing out 2019 at 15% YoY growth. In Q4 2019, Instagram ad spend rose 38% YoY, down from 44% growth in Q3 2019. However, Instagram ad impressions rose 29% YoY in Q4, while average CPM increased by 7%, and Instagram Stories ads generated 25% of Instagram ad clicks in Q4.
Merkle is a leading data-driven, technology-enabled, global performance marketing agency that specializes in the delivery of unique, personalized customer experiences across platforms and devices. For more than 30 years, Fortune 1000 companies and leading nonprofit organizations have partnered with Merkle to maximize the value of their customer portfolios. The agency’s heritage in data, technology, and analytics forms the foundation for its unmatched skills in understanding consumer insights that drive people-based marketing strategies. Its combined strengths in performance media, customer experience, customer relationship management, loyalty, and enterprise marketing technology drive improved marketing results and competitive advantage. With 9,400+ employees, Merkle is headquartered in Columbia, Maryland, with 50+ additional offices throughout the US, EMEA, and APAC. In 2016, the agency joined the Dentsu Aegis Network.