How Mobile Is Undermining The Internet's Biggest Business — Search

We may have reached a major turning point in mobile’s influence. It’s at the very least a wake-up call for the big search engines. 

Last month, PC-based search volume across all search engines declined 4.4 per cent compared to the same month the year prior, according to comScore’s monthly search rankings. (See chart below.) 

Macquarie Equities said in a research note it was the first year-on-year decline they had observed since they started tracking comScore’s search metrics in 2006. 

Why is desktop search volume declining? One reason: mobile.

It isn’t exactly a surprise. As Owen Thomas wrote over at SAI, Steve Jobs and other “tech insiders have been predicting this would happen for some time, as people shifted from using websites, where search is a natural activity, to using mobile apps.” 

According to comScore, total PC-based explicit core searches (which exclude mouse hovers and other ancillary user actions) were 17.1 billion in September 2011, and 16.4 billion in September 2012. That’s a drop of about 700 million searches. Google’s volume declined 2%. 

Search engines could still fight back. Search traffic from mobile devices is shooting up, even as desktop searches stagnate. And mobile searchers are definitely clicking on ads. But search engines can’t command the same CPC (cost-per-click) for mobile search ads as they did on PCs. For example, Performics said in late September that CPCs remain 50 per cent lower on mobile paid search compared to desktop. Google’s CPC growth has been negative since late 2011. 

Another threat to search engines is the rise of more narrowly focused searches on platforms like Amazon and eBay. The shift to specialised searches is accelerated by mobile, as popular apps launched by Amazon and others draw in users. And these are consumers intent on purchases (40 per cent of Yelp searches already come from mobile).

Search’s future depends on how consumers behave on mobile. Search engines were desktop users’ tools for discovering and navigating online experiences. But on mobile, apps tend to mediate experiences (and absorb as much as 82 per cent of users’ time spent on mobile). Apps are easy to use and offer richer feature sets than most mobile websites. The mobile web is still mostly used in an in-out fashion to quickly look up certain information. Hence, the lower CPCs.

That could change if the big shift to HTML5 and richly featured Web-based apps ever occurs

In the meantime, mobile will gnaw at the search giants’ profitable PC-based search volume. 

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