Feb
26
2008

Google: Does Search Data Indicate a Recession?

Posted by Bill Tancer under Consumer Behavior

The news is buzzing this morning, starting with a report from UBS that alleges that Google’s paid clicks are down in January. Analysts from a number of firms have been speculating that this may be a sign that a slowing economy is affecting search.
Not so fast.
If a recession is in fact affecting search, we should see a drop in the amount of traffic going from Google to retail sites (our Shopping & Classifieds category). The following chart shows the percentage of traffic over the last three years actually increasing.
google recession 1 small.png
As you can see, Google traffic to retail, on a monthly basis, is on the increase compared to previous years. If we focus in on daily data (year-over-year comparison) we see that Google traffic to retail is also up on a daily basis when we compare January/February 2007 with 2008.
google recession 2 v small.png

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CATS: Consumer Behavior

  1. Could a recession instead increase search traffic?

    • Michael E. Rubin
    • February 26th, 2008

    Nice, Bill. You don’t even reference where the data came from and who produced it. God forbid you should reference a competitor. Psst … it came from comScore! But shhh, don’t tell anyone.
    disclaimer: I worked at comScore a few years ago, but don’t have any connection with them now.

  3. SearchCap: The Day In Search, February 26, 2008

    Below is what happened in search today, as reported on Search Engine Land and from other places across the web….

    • Sam
    • February 27th, 2008

    Bill,
    Seems like we should look at brand terms in key categories to see if there is drop off Y/Y
    Also, would be interesting see if there is an increase in terms associated with recession – debt consolidation, pay day loans, etc. May be better indicator

    • Anonymous
    • February 27th, 2008

    If a recession is in fact affecting search, we should see a drop in the amount of traffic going from Google to retail sites
    Wouldn’t Google algorithm and PPC adjustments affect this metric? Presumably Google now works even harder to increase the outbound paid traffic, so recession is hard to tease out of this data.

    • Andrea
    • February 27th, 2008

    The first graph shows the month over month increase of search traffic from Google to the Shopping & Classifieds category. Yes. What you have not taken into account, is that Google search market share has also been increasing over the past three years…

  7. When Financial Analysts (& Journalists) Need Search Marketers

    I’m amazed at the logic (or lack thereof) behind the recent sell-off of Google stock amid Comscore’s report of flat YOY January paid search click-thru-rates. The press and blogosphere has been buzzing with stories ranging from sensational (Google…

  8. Our agency serves a large fraction of the IR500.
    Our specialty is large-scale PPC for online retail
    We’re not seeing any Google slump.
    From our POV, the the general economic retail malaise hasn’t migrated online (yet?) — and we hope it doesn’t!
    Full post w/ stats and charts and details:
    http://www.rimmkaufman.com/rkgblog/2008/03/03/feb-2008-ppc-share/
    Cheers
    Alan

  9. Google: Does Search Data Indicate a Recession?

    Hi,
    I think I will play safe with my first blog and point you to an interesting blog I’d read by Bill…

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