Posts Tagged ‘Microsoft’

Consumers not the cause of Google's slide

Wednesday, February 27th, 2008

Google logoGoogle’s stock price is dropping, and people are freaking out. Yesterday’s stock price drop was in response to a recent report from Comscore indicating that January 2008 showed only flat growth year-over-year versus a 25% increase in Q4. This apparently is the result of lower click-through rates on paid search ads, and people are worried that this means that Google is exposed to a slowdown if there is a recession in the U.S.

The near-panic is somewhat understandable considering that the overall U.S. economy isn’t doing all that great, the tech folks are scared of another bubble, Microsoft is talking about taking over Google, Apple’s stock is dipping, and everyone is looking for someone – anyone – to believe in. Google has been the obvious choice for a long time, and no one wants the tech darling to falter.

But the thing that I take issue with is the notion that this decrease in clicks is a result of consumers clicking less because of a coming recession. These numbers from Hitwise show that there has been no decrease in overall search traffic to shopping sites – meaning that consumers are still clicking.

And if consumers are still clicking on search links, why would they suddenly not be clicking on paid search ads? Could this be because consumers suddenly have become more discerning about what is a “paid” result vs. what is a “organic” result? No way.

My question for Google would be about how much of this decline comes from the dip in clicks on AdSense partner sites. My bet is that the clickthrough rates have dipped significantly on partner pages. Why? Primarily because of the click fraud prevention that Google has been implementing, as well as the “accidental clicking” measures that Google took back in November.

Google click change

Remember, this was the second change that Google made to its ads; the company first changed the paid results on its main search pages in April, a move that many advertisers said led to a decline in the number of clicks, but not in the amount of revenue that they were earning.

And this might just be the bottom line. If there is no growth in the number of clicks, but revenue is growing, Google may have figured out a way to increase ROI for advertisers. Like this Businessweek article says, we’ll have to wait for earnings in April to find out for sure.

Microsoft vs. Yahoo: And the winner is…Flickr!

Thursday, February 7th, 2008

By now, everyone has heard about Microsoft’s unsolicited (and unwanted) bid to take over Yahoo. You’ve read Google’s evil(ish) response. And Microsoft’s counter. Perhaps you’ve even followed the commentary for, for, for, for, for and against, against, against, against, against the deal. And the analysis about whether it would be bad or not bad for start-ups.

My opinion: either way, everything’s going to be alright. If Yahoo is absorbed by Microsoft, the world will continue. If there are services that Yahoo offers that Microsoft eliminates, another company will build products and services to take their place. If Yahoo and Google make a deal and Microsoft is left hanging, and Google turns from the good guy to the bad guy and Microsoft starts being seen as the underdog, well, that will be weird, but it will be OK. If some third-party comes and bails out Yahoo (which is not likely at this point), things are going to be fine.

Either way, some people are going to be happy. Some people are going to be unhappy. But business will continue. Something similar happened when Adobe bought Macromedia, a deal that was bemoaned by many as the demise of good creative software. But the deal went through and there is still good creative software. There will be tough times, there will be struggles, but change sometimes fosters creativity and innovation – and both of those can be better than a company withering away on the vine, which may have been Yahoo’s fate if no one stepped in and did something.

But all of that aside, I think that the real winner in all of this hubbub is Flickr. Not Yahoo, even though they own Flickr, but Flickr itself.

I noticed early on in all the discussion about the possible Microsoft/Yahoo deal that various pundants would write an analysis of the situation and then would say something like, ”No matter what happens, don’t you dare hurt my Flickr.” I commented on it, and thought it was interesting.

Then a whole movement erupted.

Currently, 2,672 Flickr users have banded together to fight Microsoft’s acquisition of Yahoo because they are afraid that it might hurt their Flickr. This is just one of the thousands of protest photos that have been uploaded:

Microsoft Yahoo Flickr
Photo by robsv

You don’t see users of Yahoo e-mail worrying. Yahoo Small Business services, which are popular and have a lot of users, aren’t protesting. It’s just the Flickr users.

So in my scorebook, Flickr is the winner. They built a brand that people love, and not only do they love the brand, but they are willing to fight for the company. Flickr did this by creating a service that’s easy to use, allows interaction, fosters community, and is free.

Or do you think that these Flickr users really just hate Microsoft that much?

A summary of Internet advertising statistics

Friday, October 12th, 2007


statisticsThis week while writing about Internet advertising I came across quite a few statistics – it seems like many of the market research firms may have been timing the release of their data to coincide with the Association of National Advertisers (ANA) Annual Conference being held in Arizona. Here’s a roundup and links to the highlights:

IAB Internet Advertising Revenue Report: Internet advertising revenues in the U.S. totaled nearly $10 billion for the first six months of 2007, with Q1 accounting for approximately $4.9 billion and Q2 totaling approximately $5.1 billion; Internet advertising revenues for the first six months of 2007 increased 26.4% from the same period in 2006; Search revenue accounted for 40% of 2007 second-quarter revenues; 2007 revenues for Internet advertising estimated to hit $20-21 billion.

Marketing & Media Ecosystem 2010 study by ANA & Booz Allen Hamilton: 90% percent of marketers plan to increase their digital marketing spending by 2010; only 24% of the 250 survey respondents think their organizations are digitally savvy; barriers to making bigger digital investments are insufficient metrics (62%), lack of organization support (51%) and lack of experience in new media (59%).

Forrester Research’s U.S. Interactive Marketing Forecast 2007-2012: marketing spend will grow to $61 billion by 2012, an increase driven by marketers who will leverage a distribution of channels rather than pour new spends into a single place; Interactive marketing will top $61 billion By 2012; Search marketing will triple in five years; Social media will drive emerging channels to $10.6 billion by 2012.

eMarketer: Online advertising will hit $21.7 billion in 2007, surpassing radio for the first time ever; $44 billion for Internet advertising by 2011.

Data Centre of China Internet: China’s internet advertising sector is expected to increase by 53.07% in 2007.

And this isn’t a statistic, but Steve Ballmer, president of Microsoft had this to say at the ANA Conference, as reported by CNET: “In world search and advertising, Google is the leader; we’re an aspirant. We have a lot of work to do in search and advertising.”

~ Stairs & Railing ~