It's Google, Not The Economy, Stupid

By Clint Boulton  |  Posted 2008-02-29 Print this article Print


Just days after comScore unwittingly put the fear of a recession into financial analysts and search engine marketers, the research firm's founder took pains to explain that it is likely certain "quality initiatives" and not a softening economy that is responsible for a decline in Google's paid clicks for January.

Phew. I'm glad we can all come back down from the ledge. The brouhaha started when comScore issued a report that found Google showed a 7 percent sequential decline in paid clicks from December 2007 to January 2008.

This prompted observers to predict a poor first quarter for the search vendor, and worse, a more pronounced slowdown in the U.S. online ad market.

ComScore CEO and Co-Founder Magid Abraham stopped short of saying the concerns were overblown, but noted "a careful analysis of our search data does not lend them direct support." It's kind of like saying, 'well we didn't mean to trigger the alarmists but if they looked more closely they would not be so scared.'

He goes on to say the dip in Google's paid click metrics is a result of Google’s move to reduce paid listings, which narrows the opportunities for paid clicks. Moreover, he said there is no evidence of a slowdown in consumers clicking on paid search ads for the rest of the U.S. search market, which comprises 40 percent of all searches. Ah, mercy.

There is a whole lot of parsing of the how and the why of Google's paid click metrics, which I encourage you to read here if you're game for it on a Friday. This chart sums up the trends: 

Abraham also delivers a statistically based slap in the face to financial analysts.

He said that while it might be fashionable to argue that the lower number of paid clicks per ad-supported query "indicates that consumers are less interested in buying what is being advertised and lends credence to a worsened economic situation" the pattern does not hold for the rest of the search market.

This is because the paid click rate for the other search engines actually increases slightly. |

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