Lower Share, Higher Cost: Making Sense of 3 Trends at Google
TLDR: We’ve been watching some recent developments at Google with interest. So much so, that we hope to reconcile three seemingly opposed trends playing out as we speak. On the one hand, the search giant’s market share fell below 90% for the first time in over a decade. On the other, overall ad spend and costs increased. And finally, as we recently covered in depth, AI adoption for search is spotty and fragmented.
How should hotel marketers respond? We offer some answers below. On the one hand, this could simply reflect supply and demand: more advertisers vying for fewer spots. On the other, we could be looking at a more nuanced picture of competition, fragmentation, and niche players.
Speaking of niche players, watch our blog. In the coming weeks, we’ll reveal new search capabilities that could give hotel digital marketing campaigns a serious edge.
Fewer People are Using Google: What the Trend Suggests
As reported in Search Engine Land, Google’s market share recently dipped below 90% for the first time in a decade, a trend that persisted across three months. This is significant because, as such a dominant player, ceding search activity to other brands suggests a departure. Users might be fed up with irrelevant content, searching Reddit or other social media channels instead. They also have turned AI tools like ChatGPT to a small degree. Rival search engines like Bing, Yahoo!, and Yandex saw modest gains during this period.
Depending on your user base, your hotel marketing strategy might benefit from platform diversification. For example, if you have a healthy flow of corporate bookings, consider Bing. Many company PCs are locked down to Microsoft native products.
Hotel Search Campaigns Contend with Higher Google Costs
On average, Google search spend grew 10% year-over-year in 2024, according to a report by Tinuiti. During the same time, the average cost-per-click also increased. What’s driving this? One explanation may be fewer users creating lower inventory. That’s likely not the whole story.
As ad spend and costs rose, click growth also grew a modest 3%. This suggests that some of Google’s ongoing optimizations gave marketers some degree of efficiency gains. However, volatility likely contributes as search behaviors change. For hotel search marketing campaigns, we recommend ongoing attention to the campaigns and terms that convert at efficient costs. In addition, review your inbound traffic. Are other search platforms sending users to your hotel website? These might present good opportunities to expand your paid search channels.
Is AI Disrupting Traditional Search?
ChatGPT and Google’s own AI search results have the potential to offer useful answers to complex questions, effectively reducing the total number of queries. Is it happening yet? Not exactly, says a recent survey. Most users remain loyal to traditional search results, and express a preference for review sites and business listings when searching for hotels on Google.
However, that doesn’t mean that disruption and fragmentation isn’t on the horizon. Maintain an active conversation with your agency. Discuss where your customers are today, and where new opportunities are emerging.
In the meantime, reach us any time if you’re looking for ways to get more from your hotel’s search marketing spend.