Google: soul searching

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Google: soul searching

By Lex October 22, 2014 11:51 am

Search is losing market share in digital advertising

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There comes a time when all monopolies falter. Think of telecoms operators or utilities, for example. For Google, too, its near-monopoly on search ads will someday end. The company is nowhere near this point yet, of course. But recently there have been signs that Google is no longer quite as untouchable as it once was.

Start with online ads. The market for digital advertising has weakened recently. According to IAB, US digital ad spend grew 14 per cent in the second quarter. Not bad. But that was the lowest rate of growth in two years. More concerning still for Google is that search ads’ share of the digital advertising pie has been shrinking since 2011.

Google is still outgrowing the market – revenues from its own sites, including YouTube, grew 20 per cent in the most recent quarter. But the move away from search is starting to hurt: Bernstein estimates that Google search revenue growth slowed to 17 per cent. Google’s fastest-growing source of revenue has become its lower-margin “other” category, which includes sales from Google Play and is growing at 50 per cent a year.

As ad dollars move away from search, Google has been losing share of the overall online advertising market to Facebook. In the US, eMarketer expects Google’s share of digital ads to fall from 40 per cent (2013), to 38 per cent (2014), to 34 per cent (2016). Facebook’s market share is expected to climb from 8 per cent to 11 per cent in the same period.

Part of the problem is that search ads do not seem to be quite as successful on mobile (the fastest-growing part of digital ad spend) as on desktop. People do use search on phones – search is about half of mobile ad spending. But these ads appear to have less impact than targeted social media ads, and could fall off quickly as more effective forms of mobile advertising are found. Facebook, which has a higher ad market share on mobile than on desktop, has seen its click-through rate triple over the past year, according to Nanigans.

Unfortunately for Google, mobile advertising is getting increasingly crowded. Snapchat, a popular photo-sharing app, is launching ads. And Yahoo is trying to boost its mobile ad offering with its acquisition of Flurry. The search business naturally tends towards monopoly. But the advertising business, ex-search, does not.

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xujingjun 发表于 2015-8-22 17:34
Google: soul searching

By Lex October 22, 2014 11:51 am

有点，，困惑，文章表示的是哪个公司会成为谷歌的竞争对手呢？