Google CEO Eric Schmidt took an indirect shot at comScore paid click data during Google’s (stellar) Q1 earnings call this week, referring to the inaccuracy of “third party data” that led Wall St. analysts to reduce earnings estimates for Google based on softness of the paid search advertising market.
This afternoon, comScore CEO Dr. Magid Abraham fired back, defending the validity and accuracy of comScore aggregation of Google paid click data.
“When Google announced strong Q1 earnings last week, some financial and media analysts wrote that comScore’s reports of slowing growth in Google’s paid clicks missed the mark. That conclusion is patently false,” said Abraham in a statement to the press. “Following several historical quarters of strong sequential domestic revenue growth (including the seasonally equivalent Q1 2007), Google’s Q1 2008 revenue growth was essentially flat, which represented a significant change for Google’s domestic business.”
The trend comScore identified shows the relationship between comScore’s domestic paid click trends compared to Google’s domestic revenue trends.
The comScore chart isn’t a “perfect correlation” because comScore doesn’t account for changes in Google’s average CPC (cost-per-click). Nor does comScore data include paid clicks from partner sites (AOL, Ask, Washington Post) or from the AdSense network, where Google paid out $5.4 billion to publisher sites in 2007 based on Google Content Advertising click volume.
Abraham warns (analysts) against extrapolating from a single data point. That’s excellent advice for bloggers as well.
Earlier, comScore provided an apples-to-apples comparison of the data sets. Google doesn’t release specifics on paid click data or partner revenue. Nor does the search engine giant provide guidance to Wall St. analysts.
The key takeaway: only Google can verify the accuracy of comScore data, and Google will never do so. So third party data (such as Google Analytics) is crucial for marketers to track.
Google paid click data for comScore did not include international paid search click data so Google’s strong global growth (supported by comScore research on increased paid search spending in non-U.S. markets)