Posted by: Marshall Sponder | February 26, 2008

Google exposed to economic weakness (Recession)?

We haven’t had a recession since Google became the God of the Internet – a God that was supposed to be immune to the economic slowdowns that plauge most businesses – but not all.

But it turns out that Google is being slowed down, just as the rest of the economy is slowing down (hopefully not to a total halt) by the economic woes of the credit crunch and sub prime mortgage meltdown.

For one thing, Henry Blodget wrote about Google Disaster: Comscore Reports Awful January*

 “…comScore reported 532mn domestic paid clicks in Jan. 08, flat YoY, but down 12% sequentially (Jan. 08 vs. Oct. Oct. 07). The click through rate was the lowest since comScore stated reporting this data and was down 200bp from levels in 4Q and down 400bps from levels in 1Q of last year. While this is one data point for domestic google.com only and from one source, which may or may not be accurate, it is a concerning data point and somewhat reflects what we have heard from SEMs – that they were not seeing a high volume of clicks from consumers possibly due to the economic slowdown.”

Also, Wall Street thinks there is a problem as Google shares take a hit on paid-search data

Chart of GOOG
Google’s shares traded down more than $22 to close the day at $464.19. Earlier in the session they hit $446.85, the lowest price seen in nearly a year.
According to comScore, Google’s so-called “paid clicks” — meaning the number of times Web users clicked on an ad-supported link — fell 7% in January from the previous month and were relatively flat compared to the same period last year.
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Responses

  1. A good and funny take on Google ad clicks slowing down at http://www.techtuesdayblog.com


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