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Google looks to conquer apps as search business matures

With Google?s second quarter results showing an 11 percent year-over-year drop in the aggregate cost-per-click rate, the company has already started to step up its efforts to grab a bigger role in applications by extending their reach. 

One particularly strong point for Google on mobile is video, with mobile watch time on YouTube doubling over the past year. While advertising revenue was up 11 percent in the second quarter, the ongoing decrease in the CPC rate suggests that the shift to mobile ? where costs are typically lower ? continues to be a thorn in its side. 

?[Google?s biggest opportunity and challenge is] apps ? in the short term in looking to see how they can be integrated into the mobile search results, and we are already seeing this both by being indexed by Google to appear in the search results, and being connected via Google?s Search Console by site owners so that their related App content is associated to a specific web page ranking when a query is done on a mobile device,? said Doug Platts, head of SEO at iCrossing. 

?To compete with this Apple is constantly updating their OS and search functionality to better index and surface Apps and App content whether you have download the App or not ? trying away from the Web,? he said. 

?But taking the concept of Apps further to the world of connected devices/internet of things, this presents a very interesting opportunity for Google.?

Mobile search monetization
Google reported yesterday that overall advertising revenues totaled $16 billion during the second quarter of 2015, up 11 percent from the same quarter a year ago and up 3 percent from the first quarter of 2015, driven by the growth in mobile search, the shift to programmatic advertising and increased monetization of video. 

Overall, paid clicks rose 18 percent from a year ago. 

"Year on year and quarter on quarter reflect continued growth in search, particularly mobile search,? said Ruth Porat, chief financial officer at Google, in a conference call with analysts to discuss the results. "We continue to close the gap between mobile and desktop search monetization. 

"Specifically, on mobile, we are pleased with our ongoing progress resulting from our focus on user experience, ads quality and online to offline commerce initiatives,? she said. 

?The combination of the efforts improves the effectiveness and value of mobile for users and marketers alike."

Shopping on Google

Google?s YouTube is also benefitting from the ongoing shift of video consumption habits to mobile. 

"YouTube again delivered strong growth in user engagement globally, particularly on mobile, which translated into strong adoption of our TrueView ad format,? Ms. Porat said. 

"Growth in watch time on YouTube has accelerated and is now up over 60 percent year over year, the fastest growth rate we?ve seen in two years. Mobile watch time has more than doubled from a year ago."

Apps everywhere
One of Google?s big developments in the second quarter was the announcement of Brillo, which is Google?s latest attempt to unify the disparate technologies of the Internet of Things and has a stronger chance of gaining acceptance than its quietly abandoned predecessor Android@Home did by providing both interconnectivity and the base for developing apps across devices (see story). 

Google also announced that application indexing is now available for Google searches on iOS devices, which could have a significant impact on how users discover content and applications. By surfacing in-app pages in Google searches on iOS devices, this makes information inside apps easily discoverable for users (see story). 

Google?s announcement this week of a significant new push into beacons with an open platform and important support for developers is another example of how the company is reimagining apps. 


?At their annual developers conference in June Google announced Project Brillo and Project Weave ? which signals the end of the Web and the beginning of Apps everywhere,? Mr. Platts said. ?While Brillo offers a streamlined version of the Android operating system for a variety of Internet connected devices, Weave provides a common language for devices to communicate with each other.

?There is speculation that these technologies could signal the beginning of a devices-specific app ecosystem,? he said. 

Mobilegeddon
One of the most publicized developments for Google during the second quarter was an algorithm change frequently referred to as Mobilegeddon, with the search giant factoring mobile friendliness into mobile search rankings as of April 21, 2015. 

With initial research by Catchpoint Systems showing that having or not having a mobile friendly page impacts both mobile and desktop in the same way following the algorithm change, this increases the pressure on marketers to optimize their properties for mobile. 

?There was a lot of awareness and conversation around how this would impact negatively the organic search results on mobile devices but when it was rolled out, on the whole the impact was minimal,? Mr. Platts said. ?There were some brands where the impact was significant but it was not across a large number of categories/sites.

?Whilst it wasn?t as terrible as the media made out I believe that this update was necessary, it forced brands to re-think their mobile site experience,? he said. ?It made them understand just how much traffic comes to their site on these devices and how they have to integrate User Experience into their Mobile SEO strategy which completely aligns with iCrossing?s Search philosophy of putting the User at the center of our client?s strategy.?

Google also made its Google Play Music streaming service free during the second quarter, with users asked to listen to ads in exchange. While this is a crowded space already with the presence of Pandora, Spotify and Apple Music, Google?s ability to bundle together a streaming music ad buy with its other offerings could provide a leg up. 

Mobile attribution
The big news for Google heading into the second half of 2015 is likely to include its buy button for search results, which the company confirmed this week are coming to mobile search within the next few weeks. 

There is also likely to be a ramping up of beacon experiences for Android 

?The challenge within the mobile space remains to close the gap in attribution for marketers and provide insights on how consumer behavior continues evolving between devices,? said Danielle Mahoney, senior group account director for paid media at The Search Agency.

?With the launch of the ?buy button? test, Google stands to gain insights and potentially alter consumer behavior towards purchasing on a mobile device more seamlessly,? she said. 

Final Take
Chantal Tode is senior editor on Mobile Marketer, New York