The other side of Google’s loss: Yahoo’s gain

[Lucas]

Reports issued by Citigroup and Bear Stearns based on information from comScore about paid clicks noted the flat January suffered by Google, as well as a pleasant surprise for Yahoo.


As we have noted before, Yahoo believes ads and not a Microsoft takeover offers shareholders the best chance to profit from Yahoo’s business. CEO Jerry Yang has one bit of good news to bolster his argument.

ComScore pointed us to the assessments from Bear Stearns and Citigroup regarding Google’s lack of growth year-over-year for January. Bear Stearns echoed the viewpoint of search marketers that the economic slowdown meant fewer people clicking on ads:

comScore reported 532mn domestic paid clicks in Jan. 08, flat YoY, but down 12% sequentially (Jan. 08 vs. Oct. Oct. 07). The click through rate was the lowest since comScore stated reporting this data and was down 200bp from levels in 4Q and down 400bps from levels in 1Q of last year. While this is one data point for domestic google.com only and from one source, which may or may not be accurate, it is a concerning ata point and somewhat reflects what we have heard from SEMs - that they were not seeing a high volume of clicks from consumers possibly due to the economic slowdown.

Meanwhile, Yahoo and its revamped search ad system enjoyed year over year growth in January, up 15 percent year over year, although it was down sequentially. Despite the post-holiday slowdown, Yang and company should be thrilled with that improvement.

Microsoft, well, they have work to do. Paid clicks down 9 percent year over year in January, flat after the holidays. Kevin Johnson probably isn’t having a great week right now.

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