What's Driving the Decline in Search Ad Coverage?

I first showed that the number of search queries continues to grow strongly, up 68% over the past two years:

However, if one looks at the number of paid clicks, the growth rate is a lower 18%, which raises the question: why have paid clicks grown 3x slower than the total number of queries?

The reason appears to be that the ad coverage (i.e. the percent of search results pages with a paid ad) has dropped from 64% to 51% of searches.

This, in turn, raises the question: why would ad coverage decline? The first hypothesis – that the search engines have been working hard to improve the searcher experience and reduce the importance of less relevant advertisers – has been widely cited, and I believe is the main driver. To help confirm this hypothesis we looked into the rate at which searchers clicked on paid ads and found that the rate hasn't changed.

But, I also find a second hypothesis to be particularly intriguing. An analysis of Comscore data shows that search queries are actually getting longer and that as searchers become more experienced they are using more words per search query. And this apparently reduces the likelihood that an advertiser has bid to have his/her ad included in the results page from these longer queries, due to paid search advertising strategies that limit ad coverage, such as Exact Match, Negative Match, and bid management software campaign optimization.

Fascinating.