ad Silicon Tails: February 2008

Friday, February 29, 2008

Comscore explains or backtracks

Following Comscore's recent release of January 2008 paid click report, which showed a 7% M/M decline in paid clicks, some commentators explained the decline by referencing a softened economy resulting in weaker buying appetite and therefore less clicks on search ads. This, of course, led to a flurry of "The sky is falling" announcements in the media/blogosphere. However, some people close to the Search market realized that there is a more straight-forward explanation: Google reduced the clickable area on Adsense text ads. Before, a user could click anywhere on the ad and be brought to the destination. After the changes, users have to click on something that looks like a hyperlink. Obviously, this is not a casual decision and goes hand in hand with other search-quality related decisions: Google may be betting that increased quality of clicks will result in increased cost per click. In theory at least that's how a free marketplace environment works. Comscore released a statement this morning explaining their numbers in this way, which is all fine although it seems they have been heavily incentivized to do so. They are almost scraping the floor when trying to gracefully bow out by saying that "the evidence points to a trend caused by another Google clever design, leveraging Adam Smith’s enduring ‘invisible hand’."
That's lame. I wonder how much Google were actually surprised and caught off guard by the decline as a result of the changes?