Saturday, June 16, 2007

Google, Paper Tiger?

Interesting news:

There was encouraging news for the growing army of Google-haters yesterday when a leading internet advertising researcher suggested that the search engine’s stranglehold on online promotions was looser than he had expected.

Bill Tancer, a research analyst at Hitwise, the internet research firm, said that eBay’s decision to pull all its advertising from Google in the US had had only a small impact on the “traffic” flowing from the search engine to the online auctioneer’s site.

Some 9.6 per cent of eBay visitors came from Google on Tuesday, the first full day that the boycott was in effect, compared with 10.6 per cent on the previous Tuesday, Mr Tancer said.

“Before I pulled the data, I was expecting a bigger drop given the drastic removal of sponsored listing ads by eBay,” he said.

He added that that the impact of eBay’s advertising withdrawal was reduced by the fact that 25 per cent of users visiting the internet auctioneer from Google do so after searching for eBay, rather than by clicking on one of the “sponsored links” that appear next to other search results.

The data suggests that Google may be less powerful than people thought, at a time when the search engine is seeking to widen its empire – and drawing fresh criticism almost every day as a result of its perceived growing dominance.

Overstated somewhat I believe. eBay's traffic from Google comes not from its ads, but from search queries. Were Google to boycott eBay in its search listings by reconfiguring its algorithms to demote eBay listings (in opposite fashion to what it does to promote Wikipedia entries), the auction site's traffic would decrease markedly.