Google’s Paid Clicks Growth Halts In January and February
2008 has not been a good year for Google’s US paid clicks. October and November of 2007 showed big growth over the previous year, the growth slowed in December and came to a screeching halt in January, with 0% change reported over the previous year.
Now that February’s report is out, reporting a 3% increase over last year (which is erased when one considers the leap day), concerns about paid click growth are intensifying. Google’s stock has thus far declined around 3% today.
This decline in paid click growth is counter to the upsurge in total queries. Queries were up 30% for the month in the US, so people were using the search engines more and hitting paid clicks less. If search growth wasn’t so strong, than the stagnation of paid clicks wouldn’t be such a concern.
Wall Street analysts expect around 5%-7% growth each month in paid clicks. While October had a massive 37% gain over the previous year, there is a leveling out that has occurred. If one were to average out the growth over the last five months, it would be an increase of about 15%, which outperforms expectations.
All of this needs to be taken with a grain of salt. Questions still remain about the accuracy of comScore’s readings, and putting too much stock in their findings may be hasty. Second, this is part of an overall economic downturn that doesn’t imply long term problems. Third, investors in Google should be excited about the possibilities of mobile ad serving with the potential utilization of “white space” down the road.
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