Spend - Paid Search
What is this metric?
The Spend - Paid Search metric estimates a brand's total paid search spend for desktop for a selected timeframe.
How is this metric calculated?
BlueOcean estimates a brand's paid search expenditure for desktop, focusing on traffic originating from the United States at the domain level. This estimate is formulated by aggregating the most recent 30-day estimated traffic cost, calculated based on the average expense to achieve rankings for keywords observed by desktop devices in the United States, specifically for Google AdWords and Bing Ads. This 30-day total is then prorated for a selected timeframe.
Data source(s): BlueOcean-trained Proprietary Data Model considering estimated data from:
- Semrush
Data Source Update Frequency: Monthly
Can Ratios Impact this Measurement? Yes
BlueOcean Applicable Framework(s): BlueOcean framework │BlueOcean Basic framework
How is this information valuable to my brand?
The Spend - Paid Search metric is a valuable resource for:
- Budget Benchmarking: Understanding what competitors spend on paid search provides a benchmark. If competitors consistently outspend a brand, it might suggest they capture a larger share of the digital ad space, and spending adjustments might be required.
- Estimating Market Share & Intent: A significantly higher ad spend by a competitor might indicate aggressive targeting or an attempt to capture a larger market share. Conversely, a spending reduction might signify shifts in strategy or potential areas of opportunity for a brand.
- Strategic Allocation: If competitors are heavily investing in paid search, but a user's brand has a stronger organic reach, they might opt to allocate resources differently, perhaps focusing more on content marketing or other organic strategies.
- Identifying Market Trends: An overall increase in spending across competitors might indicate growing competition, a larger customer base moving online, or rising keyword costs due to high demand.
- Keyword Strategy: While the exact amount won't reveal specific keywords targeted, a sudden increase in a competitor's ad spend might prompt a deeper analysis to identify new keywords or strategies they're pursuing.
- Campaign Timing & Seasonality: Recognizing competitors' spending patterns can reveal seasonality insights, allowing brands to optimize campaigns during high-opportunity periods.
- Forecasting & Planning: Understanding industry-wide ad spend trends can help forecast and plan future budgets, ensuring brands remain competitive.
- Investor & Stakeholder Communication: Demonstrating that a brand's spending is in line with or more efficient than industry competitors can be a positive point in discussions with stakeholders or investors, showcasing strategic financial management.
- Tailored Marketing Strategies: For instance, if competitors are significantly outspending a brand in certain geographical regions or demographics, a brand might opt for more niche targeting, leveraging untapped markets or alternative platforms.
Additional considerations where this metric can play a role:
- ROI Analysis: By comparing the paid search spend with measurable results (e.g., conversions, leads, traffic), brands can determine the efficiency and effectiveness of their campaigns. Suppose a competitor spends significantly but has less market share or online presence. In that case, it may mean their campaigns are less efficient.
- Ad Creative & Format Insights: While spending alone doesn't provide this data, knowing where competitors are investing heavily might lead a brand to analyze the types of ad creatives or formats used to engage users.
- Leveraging Negotiation: With platforms or agencies, knowing industry-standard spending levels can be a tool to ensure a brand gets the best possible rates or deals.