Last month, according to “Big Blue,” 11 percent of people visited a retail website on a mobile device. In particular the iPad will play a significant role in “mobile” purchase behavior. IBM said that “shoppers using an iPad will lead to more retail purchases more often per visit than other mobile devices.” IBM added that iPad conversion rates were 6.8 percent in the iPad vs. 3.6 percent for mobile devices overall.

Other recently holiday related mobile predictions and estimates include:

• Google saying that “44 percent of total searches for last minute gifts and store locator terms will be from mobile devices.”
• Performics said that “Google search clicks from mobile devices are now 14.2 percent of all search clicks” and expects paid clicks coming from mobile to grow to 17.3 percent this December

Separately today comScore released its latest US smartphone share data:

Smartphones represent 37 percent of all US mobile handsets according to comScore. However Nielsen says they’ve now reached 43 percent (and more than 50 percent for those under age 45). The Pew Internet Project says 42 percent of mobile subscribers have smartphones.

According to a recent study from Acquity Group, 37 percent of the “Internet Retailer Top 500″ companies now have a mobile site. Those that don’t will find they’ve missed an opportunity this holiday shopping season. Earlier this year Google said that 79 percent of its top advertisers didn’t have a mobile-optimized site.

Nielsen says that 43 percent of US smartphone owners have an Android handsets compared to 28 percent who own iPhones. These numbers are almost identical to comScore’s. We’ll see if holiday sales of the iPhone 4S change that in any way.

What’s most interesting about the data from Nielsen is the age-based segmentation they do. For those under 44 years old, smartphone penetration has now crossed the 50 percent threshold (54 percent). In fact for those in the 25-34 age category it stands at 62 percent.

If your target audience or prospect base is anyone under 45, know that more than half now own smartphones. Also understand that for some number of them — especially younger users — smartphones and tablets will be primary internet devices.

When the base is just mobile phone owners however (83 percent of American adults) the number goes up to 42 percent. The numbers go even higher in certain population segments; among 18 to 44 year old smartphone penetration is 50 percent. By contrast Nielsen reported that 38 percent of US mobile phones are now smartphones, while comScore says the number 33 percent in the US.

Pew also found that 87 percent of smartphone owners go online or get email and 68 percent do so daily (Google found that 53 percent of smartphone owners are online “multiple times” per day). Here’s the most interesting finding perhaps: “25 percent of smartphone owners say that they mostly go online using their phone, rather than with a computer.”

Pew didn’t fully explore the behavior around this finding, but said the following about whether this 25 percent was driven by preference or necessity:

Even among smartphone owners who use their phone as their main source of internet access, computer (i.e. laptop or desktop) ownership is quite prevalent. Indeed, fully 84% of these individuals also have a desktop or laptop computer at home.

Thus it would seem that mobile internet access is the preferred method for a sizable group of people: as many as perhaps 22 million Americans. This obviously holds significant implications for search and search marketers.

The smartphone market-share breakdown in the Pew data is as follows:

These figures don’t entirely agree but are directionally consistent with data from comScore and Nielsen. There’s also quite a bit of demographic information in the survey, including the following:

Related Entries

• comScore: Android And RIM Smartphone Share Heading In Opposite Directions
• comScore: the iPad Owns 97 Percent of US Tablet Traffic
• Android Has More Check-In Users Than Apple, But Just Barely
• comScore: Apple’s iOS Reach Is “Double” Android’s
• Mobile Search Use Stats: Big At Home, When Watching TV, While Running Errands
• comScore Looks Back At Smartphone Growth In “Mobile Year In Review”

A new study from AT&T Interactive and Nielsen, conducted this March, validates that location is a key part of the mobile-user experience. The study also reflects the often-superior performance of local-mobile ads.

Restaurants the Top Local-Mobile Category

AT&T VP Steven Wise presented findings from that study, which involved 1,500 US consumers who owned feature phones, smartphone and tablets, today at the Where 2.0 conference in San Jose California. Consistent with other studies in the market the AT&T-Nielsen survey found that restaurants was the top local search category in mobile.

Beyond that the chart above reflects the hierarchy of local business categories that were “most researched” on mobile devices. Even though “professional services” and “contractors” showed relatively lower volume those users turned out to be the most likely to click on mobile ads, according to AT&T.

Younger Users More Inclined to Share Location

There’s evidence from various sources of consumer concern over privacy, especially among older mobile users. The AT&T-Nielsen study is consistent and shows that men under 45 are more inclined to share their location with mobile apps.

One of the reasons for allowing location detection is to enable exposure of “nearby” businesses or get local recommendations. More than a third of respondents said they allowed apps to get a fix on their location at least weekly (putting aside surreptitious iPhone tracking). More than 20 percent did this several times a week or more.

Local Ads Perform Better

I’ve written numerous times about the greater relevance of location-based ads in mobile and the improved consumer response accordingly. Microsoft has said that 53 percent of mobile search has local intent and Google has said the number is 33 percent. In addition, mobile users are generally more inclined to take immediate action than PC searchers, according to both Google and Microsoft.

Surojit Chatterjee, Product Lead Local and Mobile Ads, has said, “Mobile users are more prone to take immediate action. People searching on mobile have a higher intent. The time between intent and action has been narrowed.”

The combination of higher intent and greater interest in locally relevant information makes for a potent combination for mobile marketers. The AT&T study found that about two-thirds of local-mobile search users see ads weekly; and roughly 25 percent of users click on mobile ads at least weekly.

The graph below indicates users’ motivations for clicking on mobile ads.

Local-Mobile Searchers Go to the Store — and Buy

Given all of the above perhaps it comes as no surprise that the study found 43 percent of local searchers on mobile devices physically showed up at the business location. Perhaps even more impressively 22 percent of those users actually made a purchase.

While the future of the check-in as a mainstream phenomenon in mobile can be debated at length there should be no doubt about the importance or value of local content and locally relevant ads to mobile users.

Here is the Nielsen data from earlier this week, showing Microsoft/Bing overtaking Yahoo:

And here is the August comScore data (reported by Citibank):

• Google: 65.4% (down from 65.8% in July)
• Yahoo: 17.4% (vs. 17.1% in July)
• Bing 11.1% (vs. 11% in July)

The comScore data show Bing as flat, not growing. The combined share of Bing and Yahoo is 28.5%.

Among the firms that track search market share Nielsen is the outlier right now. I’m going to ask Nielsen how to explain the discrepancy in the data between the two firms.

In the meantime, how would you explain it?

Although Google saw little change in its month-over-month search volume, it still dominates the search market, accounting for 65% of all U.S. searches. Yahoo! followed Google and MSN/Windows Live/Bing Search with a 13.1% share of U.S. searches, falling from a 14.6% share in July 2010 to 13.1% (a 1.2% delta decrease or an 8% relative decrease).

In terms of a year-over-year comparison, Google has seen little change in its share of search while Yahoo! has seen a small but steady decline, going from a 16% share to 13.1% (a delta drop of 2.9% or a relative drop of 18%).  MSN/Windows Live/Bing’s share has grown from 10.7% in August 2009 to 13.9% (a delta increase of 3.2% or a relative increase of 30%).

Source: Nielsen

Nielsen says that it only counts “intentional” searches and not slideshows or “contextual searches.”

By contrast comScore shows Yahoo growing and six points ahead of Bing, according to the firm’s July “explicit core search” numbers:

The most recent Hitwise data also show Yahoo still in second position:

Nielsen told us that Bing’s growth has come largely at Yahoo’s expense.  The other numbers above argue that it’s too early to anoint Bing as the confirmed number two. But that would appear to be its trajectory.

Ad network Chitika found Yahoo to have been overtaken by Bing back in January: Chitika: Bing Passes Yahoo In Search Market Share.

A separate article in the Wall Street Journal this morning, which discusses the Verizon-Bing “default” mobile search deal, cites comScore data that show Bing’s share of mobile searches is very small, although growing:

According to Nielsen, Bing’s market share in July 2010 was up to 13.6%, a 51% jump from its 9% market share in July 2009 — which was basically Bing’s second month of existence. Google remained relatively static over the past year, while Yahoo’s market share has fallen 17% from a year ago.

Here are Nielsen’s stats for July 2010, which show Google is still very comfortably the number one U.S. search engine.

That represents an increase of almost 6% from Bing’s 12.2% share in March. Google dropped slightly, from 65.7% in March to 65.1% in April. Yahoo gained a tenth-of-a-percent, from 13.4% to 13.5% between March and April.

Nielsen’s latest video market share numbers are pretty much what you’d expect. YouTube is the dominant site both in unique viewers and video streams served during April.

Caveats To Live & Love

I’ve been covering search share figures for a long time. A very long time — from before Google existed. Before I dive into a post about search share, I’m going to revisit my long-standing advice that I offer anyone:

• Avoid drawing conclusions based on month-to-month comparisons. Lots of things can cause one month’s figures to be incomparable to another month. It’s better to see the trend across multiple months in a row.
• Avoid drawing conclusions based on one ratings service’s figures. Each service has a unique methodology used to create popularity estimates. This means that ratings will rarely be the same between services. However, a trend that you see reflected across two or more services may give you faith in trusting that trend.
• Consider Actual Number Of Searches: While share for a particular search engine might drop, the raw number of searches might still be going up (and thus they might be earning more money, despite a share drop). This is because the “pie” of searches keeps growing, so even a smaller slice of the pie might be more than a bigger slice in the past.

Do Two Months Of Gains = Trend?

As I’ve warned, a month-to-month jump is no big deal. A two month rise? I’m more interested. Keep that going over six months, now I’m feeling like a trend is happening.

There’s interest today in Yahoo because new figures from comScore show that in March and April of this year, Yahoo increased its search share. Prior to that, Yahoo had a full year of share decline.

April is particularly interesting, because Yahoo rose almost a full point, from a 16.9% share to a 17.7% share. And boom! In both March and April, Google saw a drop in share. Take that, big G!

What happened? comScore puts the growth down to navigational changes:

Both Yahoo! Sites and Microsoft Sites have experienced gains due in part to the introduction of new site navigation experiences that tie content and related search results together within several channels.

Search Share Over Time

Do these changes go to the bottom line? Hold on to that thought. First, let’s look at the share trend over time:

That chart shows the percentage of searches handled each month by Google, Yahoo and Bing out of all searches that happen on five “core” search engines that comScore measures in the United States (Ask and AOL are the other two, not shown on the chart — both have less than 5% share).

Yahoo Slips From Its Share “Band”

That’s a pretty stark drop for Yahoo. In the past, I’ve written about search engines being within “bands” of share. Yahoo had been barely holding within the 20% to 30% “band,” then last September settled into the 10% to 20% range.

And Google? Sure, the last two months saw its share drop about 1% in total, a tiny bit compared to its overall share. But more important, Google has been in the 60% to 70% band for over two years. It’s way early to be thinking something’s significantly wrong. Google’s had consecutive drops before and kept on growing despite these. That’s not been the long-term story for Yahoo.

Is Bing Robbing Yahoo?

Meanwhile, look at Bing. Unlike Yahoo, it shows signs of leaving its traditional band of 0% to 10% behind and moving into the 10% to 20% range. Indeed, virtually all of Bing’s share increase appears to have come from Yahoo.

That’s not a surprise. Bing has been spending like mad on television advertising, positioning itself as a Google alternative. That seems to be working — except instead of pulling people from Google, Bing seems to be pulling the Google alternative audience that had been using Yahoo, as I expected.

Maybe. You’d really need to do a much deeper analysis of the figures, in particular, to get some crossover figures. What chunk of people used Google as their “primary” search engine and Yahoo as their “secondary” one before Bing’s launch in June 2009 compared to today, for example. That might give you a better sense if Bing really is pulling people away from Yahoo, as the figures suggest.

Getting those figures is hard work. It’s custom data that the big ratings services don’t typically release, nor that the financial analysts — if they’re ordering it up — typically put out in their financial advisory notes.

The Importance Of Search Volume

Still, there’s another number that’s easy to get that provides some great perspective — search volume. This is the number of searches that happen on a particular search engine in each month.

Why’s search volume so important? Well, the overall “pie” of searches keeps getting larger. A smaller percentage or slice of a big pie can equal more searches than a big slice of a small pie.

For instance, look at this recent share drop for Google:

• February 2010: 65.5% share
• March 2010: 65.1% share
• Drop: 0.4%

A drop, right? A sign that the big G is having problems. But now look at the volume:

• February 2010: 9.5 billion searches
• March 2010: 10 billion searches
• Gain: 0.5 billion searches

Google’s “Loss” Is Actually Huge Gain

Got that? Google gained 0.5 billion searches in the same time period that it was reported as having a marketshare drop. 500 million searches. That’s nearly as many searches as Ask handles in a given month. More than AOL handles. It’s 1/4 of ALL searches that Bing handles, or about 20% of ALL searches that Yahoo handles. Oh — and that’s even with me rounding down to keep everything in even multiples of 5. The actual volume change was 573 million searches.

How did this happen? Well, the overall searches on the five major core search engines reported by comScore totaled like this:

• February 2010: 14.5 billion searches
• March 2010: 15.5 billion searches

In one month, 1 billion “new” searches came out from nowhere. More than half of those new searches — about 600 million of them, came from Google. Yahoo only added about 200 million new searches to the pie; Bing, about 150 million, figures all rounded.

The pie grew overall, with Google by far the biggest contributor to that growth, but ironically its competitors are so much smaller that their growth made Google seem to have “lost” when talking about share figures.

Comparing Share To Volume

So what’s the volume trend like? First, a reminder of the share figures:

Now the volume figures:

Anyone want to get excited about Yahoo’s 1% “share” growth in a given month now? Sure, Yahoo’s also grown volume in the last two months — but on a volume basis, Yahoo’s even further behind Google than the share figures reflect.

Google Has Nearly Doubled Volume

Over the past two years, Google’s nearly doubled its search volume from around 6 billion searches per month to 10 billion searches — and that’s not counting searches at Google-owned YouTube. In the same period, Yahoo’s pretty much still at the 2.5 billion searches range — no long term growth. At least Bing has shown steady growth from the 1 billion to 2 billion range that seems likely to continue — assuming Bing keeps doing the marketing.

If Bing stops marketing, we’ll see. That’s the real thing to watch right now. What happens when the TV ads stop?

Gaming Search Figures?

As for the gaming aspect, let’s go back to what else comScore had to say on those navigational queries:

These features provide search results to users as they navigate through topical content and meet comScore’s established criteria for counting search queries.

That’s code for “we might be counting things we didn’t count before, and in case anyone complains [ahem, Google], these are legit searches.”

Of course, if new things are being counted, then all the past figures usually get tossed out — that’s what Nielsen did with its measurements in the fall of last year. I’ll be revisiting this in a future post.

We’ve been here before. In particular, there’s been a long-standing issue on whether the game-oriented searches that Bing offers (such as at Club Bing) should be counted as “real” searches (see SearchPerks – Microsoft’s New Prizes For Searches Program).

It’s actually part of something I’ve been working on recently, and here’s a quote I got from comScore last month on the issue as part of my research:

So did the Yahoo and Bing navigational changes really grow search that much and if so, do they go to the real bottom line, as there’s much commentary on today? I’ll follow up more on that later when I’ve had a chance to talk further with Yahoo and comScore. But as Kara Swisher at AllThingsD notes, we’ll really know (to some degree) with actual financial reports come out.

Also keep in mind that it’s not just changes at Yahoo and Bing that can inflate search figures. Every time Google runs a custom logo for some holiday, people click on it — and generate a search. In the past two years, Google’s greatly increased the number of logos it has run (see my Those Special Google Logos, Sliced & Diced, Over The Years post from this weekend for more). Are those generating volume increases?

Easy To Jump; Harder To Keep Flying

Here’s the thing. From what I’ve seen over the years, new navigation or other changes may grow share and/or volume to a new level but they don’t produce continued growth. In other words, you might jump up to a new height, but then you stop flying higher unless there’s actual honest-to-goodness search growth that’s also happening.

If Yahoo’s volume continues to rise according to multiple ratings services over the long term — and search-related revenues rise with it — then there’s a compelling story. So far, it still feels like the same old, same old to me — Yahoo losing people probably to Bing; Google standing well above them both with no signs of erosion.

Today’s news also highlight a long-standing issue that the industry has yet to address. Search share and search volume figures don’t tell the entire story. Both can be “inflated.” Or deflated, in a world where “blended” search might integrate information that previously required two searches to retrieve.

Revenue per search helps, but when Google doesn’t break out search revenue from display and contextual ad revenue, how much they make per search is an inaccurate guessing game that some third parties like to play. And even revenue per search might not indicate a long-term consumer trend. You can spike revenue per search by simply adding the number of ads to a page — but in turn, that might be a turnoff to searchers, leading to a long-term audience loss.

Ideally, we’d have some industry-agreed benchmarks. Don’t get your hopes up about that, however.

It’s also two solid months of growth for Bing after a dip in December. Meanwhile, Google has seen two straight months of falling market share.

Those are Nielsen’s February numbers above. Below is a chart showing Nielsen’s numbers over the past four months.

Lest anyone get too worked up, these numbers show that Bing and Yahoo combined have shown very little growth over the past four months, and Google has shown very little loss of market share over the same period.