The Google Killer – comScore (SCOR) Doomsday Scenario


ComScore did what Yahoo, Microsoft, Facebook, and Digg only dreamed of.

ComScore killed the search engine star.

ComScore data on Google paid clicks rocked the world this week. The proprietary comScore qSearch report was analyzed to death by Wall St. analysts and media pundits. Data: summarized and judged; Google, convicted, flogged and sentenced to an early demise.

It wasn’t hit and run, though: comScore’s SVP of Media and Search, James Lamberti, and CEO and Co-Founder Dr. Magid Abraham delve deep into the data to correct the rush to judgment in the marketplace. It’s a must-read. Great analysis; surprisingly lifeless title: “Why Google’s surprising paid click data are less surprising.”

It should’ve been “Data doesn’t kill Google, people do.”

QSearch showed a 7 percent decline in January ’08 vs. December ‘07. Paid click annual growth? Flat for Google.

Month-over-month the number of paid clicks per search on Google dropped by 8 percent (December ’07 to January ’08). Consumers clicking less on search ads? Maybe. A weaker buying appetite?

Google’s share price took a hit and rebounded. Reports of Google’s early demise? Greatly exaggerated. That doesn’t mean the momentum-driven Google shares won’t take a hit if Google fails to impress the Street this quarter.

Wall St. analysts – looking for clues where Google gives no guidance – had accomplices: mainstream media and bloggers hoping for a Google stumble.

No one wants to miss the Hindenburg. The only problem? The Hindenburg Crashes Nightly when Google news goes viral.

The Google backlash reared its ugly head and this time it wasn’t just Valleywag.

LendingTree whose multimillion dollar paid search campaigns are managed by search marketing firm Efficient Frontier, made public its new online marketing strategy: cutting back on PPC or paid search.

LendingTree spokesperson Allison Vail was quoted in CNET by Stefanie Olsen.

“With the Fed changes in January, we were driving natural traffic. It’s smarter for us,” said Vail.

Our readers know it’s always smart to optimize for natural search. I’m not sure anecdotal evidence from a financial services pure play in the throes of a global subprime mortgage crisis proves paid search revenues are declining.

Statistics from search marketing firms, though, would lend credence to the argument.

For average CPC (Cost Per Click) by industry vertical (Financial Services, Mortgage, Credit, Auto), click here.

Efficient Frontier Chairman Ellen Siminoff, chairman told CNET that paid search advertising spendi in financial services has typically risen between 30 percent and 50 percent annually.

So far this year it’s either flat or down for some companies. credit and mortgage advertisers raised their spending by 24 percent, but this year, their spending has risen only 3 percent year over year, according to Efficient Frontier data.

Coming soon: Efficient Frontier / Search Engine Watch Average CPC data for February.

Be the first investment banker or hedge fund manager on your block to see the stats.

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