The Downturn that Isn’t – Google is doing just fine

Tuesday, March 25, 2008
Posted by Jim Hedger @ 10:51 am

Get ready to read some disturbing news in the next few weeks. Though not a fortune-teller or psychic, my gut-sense tells me that the search and mainstream media is going to get all apocalyptic over a perceived downturn in ad-spends in the major PPC networks. I am almost certain it is going to happen and just as certain the reports, though numerically correct, will be factually wrong.

Next week marks the end of Google’s first quarter in 2008. As with the comScore report issued in late February that showed a .3% decline in click-throughs on the AdWords network in January 08, we are bound to read about lowering numbers of clicks and subsequent worries about Google meeting the often over-hyped and unusually under-informed expectations of Wall St. analysts.

Google has seen a minor decline in clicks but that is mainly due to Google’s own diligence. Google is moving to clean-up its click-stream by making it more difficult for searchers to make mistaken clicks. It has limited the clickable area in AdWords and is better filtering bad clicks. Both actions serve to lower the overall number of clicks recorded and billed for, thus slightly lowering Google’s perceived ad-audience and very real revenues.

Google also yesterday introduced a no-nonsense policy regarding redirects and landing page URLs that basically states the target URL seen by the consumer (ad-clicker) has to be the same as the one their click ends up on. This move will certainly increase the relevancy and accuracy of Google AdWords placement but will also likely cause a very minor lowering of actual click-numbers.

Given the very slight decline in recorded clicks (0.3%) in January ‘08 over January ‘07, it is not only possible but very likely that Google is seeing an increase in relevant and “true-clicks”. In other words, the AdWords network is in no way losing value to advertisers and will continue to be an astounding revenue driver for Google for quarters and quarters to come.

I did some quick and very basic math on comScore’s January numbers. According to comScore, Google saw 532million ad-words clicks in January. That means there were (on average w/rounded numbers)

- 17,161,290 ad-clicks per day,
- 715,054 ad-clicks per hour,
- 11,917 ad-clicks per minute,
- and 199 ad-clicks per second.
Google is serving almost 200 ads per second. No other media network comes close. Think about that when reading the “sky is falling” reports that are likely going to start next week and continue well into the second quarter. Paid search advertising remains a cornerstone of an overall search engine optimization and marketing effort.

Advertisers and consumers should watch for Google AdWords to be the conduit into other forms of online advertising in the very near future. The Internet medium as we know it today is about to undergo a number of radical changes (yet again), many of which are coming in the next six months. The sum of those changes will make the Internet the only practical broadcast communications medium within the next two or three years. Don’t just watch for it, prepare for it.

1 Comment »

  1. Psychic Reading Msn…

    Hi – just wanted to say good design and blog -…

    Trackback by Psychic Reading Msn — Saturday, September 27, 2008 @ 7:59 pm

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