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The Guardian reports drop in Google & Yahoo’s ad clicks

By Andrew Redfern @ 27th February 2008 2:01 pm

and a rise in MSN Live’s :

Yesterday’s dip in Google’s share price came after the markets became alarmed by data from web measurement firm comScore showing that the number of clicks on ads next to Google’s search results fell by 7% between December and January. Google’s ad click performance was also down 0.3% on January last year, according to comScore.

Google had seen the same 7% decline between November and December. ComScore’s data also showed that Yahoo saw a 1% month-on-month fall in paid search ad clicks in January, but Microsoft saw a 4% rise.

The article also highlights a decline in Google’s share price as a result of this fall

“Google’s share price fell to $464.19 (£233.75) by close of trading yesterday. The company’s shares had peaked at $747.24 in November, with analysts in the industry speculating that the share price could even rise to $1,000. Since that peak in November, Google’s shares have fallen 38%.”

“Google earns the bulk of its $16.6bn revenues from search advertising, but despite warning of its vulnerabilities, most analysts said the firm is still in a strong position because of its track record.

Citigroup analysts rated Google “high risk” as a result of yesterday’s comScore data, because of the “highly competitive landscape the company faces”, though it did note the firm’s healthy balance sheet of $8bn in cash and the liquidity of its shares.

Analysts at Citigroup also said that Google’s efforts to improve the quality of leads for its advertisers, by trying to reduce accidental clicks, may have impacted the volume of search clicks as well as the wider macro-economic climate.”

The full article written by Jemima Kiss is available at Guardian.co.uk

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