A new study on the state of paid search in the travel sector in the U.S. found that paid search expenditures fell 19% from January through April of this year compared to last year. The study suspects the decline is due in large part to the launches of Google Flight Search and Google Hotel Finder.
On the cusp of the summer travel season, AdGooroo has taken a look at the state of paid search in the travel sector in the U.S. The company has found that, on the whole, paid search expenditures have been trending down since 2011. Spend fell 19% from January through April of this year compared to last year. That follows an 11% drop during the same period from 2012 to 2011. The downward trends hold through the summer months.
AdGooroo suspects the decline in ad spend since 2011 is due in large part to the launches of Google Flight Search and Google Hotel Finder that year. The actual number of advertisers in the travel category on AdWords in the U.S. increased from 217 in Q1 2012 to 228 in Q1 2013. However, AdGooroo believes that the presence of Google Flight Search and Google Hotel Finder has led to a cannibalization of clicks and ad spend from those AdWords advertisers.
Google Flight Search and Google Hotel Search tend to appear on SERPs for generic search terms like “cheap flights” and “hotels” which also trigger ads from multiple advertisers. As AdGooroo’s keyword cloud from Q1 below illustrates, there are huge number of ad impressions (tens of millions) generated on these generic searches. Yet it seems Google’s paid inclusion verticals are eating into paid search ad traffic on these searches.