| From: Gabriel008 | 1/27/2006 12:31:48 PM | | | | | | I set up a quarterly search index [QSI] that compares GOOG vs YHOO. In the latest quarter YHOO's QSI was 0.7% vs 18.9% for GOOG. This QSI is a function of Reach plus Page Views but does not include market growth or pricing power. In terms of market growth this is universal and impacts both GOOG & YHOO identically. Pricing power is another issue, however. In late August GOOG implemented Variable Term Pricing effectively increasing their CPC rates. This VTB didn't seem to impact revenues in Q3 but that may have been due to market lag. Who knows?
YHOO's QSI was 0.7% in Q4 & their sequential revenue growth was 13%. GOGG's was 18.9%. Does that mean their sequential revenue growth will be 31.2%. I think 31.2% will be their minimum growth & with VTB thrown in it may go to 35%. |
| | Google - No Soapbox | Stock Discussion ForumsShare | RecommendKeepReplyMark as Last ReadRead Replies (1) |
|
| To: Gabriel008 who wrote (1) | 1/27/2006 1:32:53 PM | | From: Gabriel008 | | | | Now, in trying to confirm or validate GOOG's 30%+ Q4 I decided to break down each quarter into their respective months & estimate each month sales.
Every quarter has its own factors that impacts revenue. Here they are - in my mind, at least.
November & December - big advertising & retail sales months
June & July - summer holidays with July the lowest revenue month [August summer slowdown somewhat mitigated by back-to-school period].
September Heavy BTS period for September
Other assumptions I've made;
Revenue - the last month of the previous quarter equals the first month of the new quarter.
DATA
2003
Q1 $249
Jan $80
Feb $80
March $89
Q2 $311
Apr $89
May $120
June $102
Q3 $394
Jul $102
Aug $135
Sep $157
Q4 $512
Oct $157
Nov $170
Dec $185
2004
Q1 $651
Jan $185
Feb $230
March $236
Q2 $700
Apr $236
May $240
June $224
Q3 $806
Jul $224
Aug $275
Sep $307
Q4 $1032
Oct $307
Nov $350
Dec $375
2005
Q1 $1256
Jan $375
Feb $425
March $456
Q2 $1384
Apr $456
May $500
June $428
Q3 $1579
Jul $428
Aug $525
Sep $626
Q4 $2026 $2076 $2001 $2126
Oct $626 $626 $626 $626
Nov $675 $700 $650 $700
Dec $725 $750 $725 $800 |
| | Google - No Soapbox | Stock Discussion ForumsShare | RecommendKeepReplyMark as Last ReadRead Replies (1) |
|
| To: Gabriel008 who wrote (4) | 1/27/2006 1:56:09 PM | | From: Gabriel008 | | | | Andrew Goodman of Traffick;
It sounds like clicks convert better to revenues out of these top ("premium") spots, at least on popular mainstream terms, according to the Atlas Research studies.
So if commercial traffic is being better monetized AND it also converts better for advertisers, it would have been full steam ahead at a higher average revenue per page in Q4.
Countering that was an entirely different phenomenon, the introduction of a new Quality Scoring system to replace the old ad ranking formula. The result of this seems to be the removal of some lower priced clicks from the system (fewer ads showing on some queries). While this might have dampened revenues slightly, it seems inevitable that Google in Q4 will have significantly reversed the stagnating trend in average CPC's.
Overall revenues may be at or slightly below expectations, but profit margins should surpass expectations. Presumably, if you work for Yahoo, you don't manage a wide range of AdWords accounts. We do and I can't for the life of me see any reason to doubt that Google had a monster Q4. AdWords runs very efficiently compared to Y!SM. |
| | Google - No Soapbox | Stock Discussion ForumsShare | RecommendKeepReplyMark as Last ReadRead Replies (1) |
|
| To: Gabriel008 who wrote (5) | 1/28/2006 2:00:10 PM | | From: Gabriel008 | | | | | I get the distinct impression that these SV tech guys don't understand marketing very well in terms of penetration/share/PV's etc. Penetration [i.e., reach] and PV's per user are mutually exclusive. We shall see on Tuesday after the close. I'm glad there's a healthy amount of skepticism. |
| | Google - No Soapbox | Stock Discussion ForumsShare | RecommendKeepReplyMark as Last ReadRead Replies (1) |
|
| From: Gabriel008 | 1/30/2006 9:20:19 AM | | | | | | Google: Click fraud chaos - NY Post -Update-
According to the NY Post, Google's long-simmering click-fraud problem could explode into a billion-dollar headache for the Web giant, some Web marketing experts are warning. In fact, a growing number of Google-watchers claim the search giant is ignoring the click-fraud issue because it's so large. Click-fraud happens when surfers click on Goggle advertisers with no desire to get to the advertiser's site. Knowing Google charges advertisers based on how many surfers click on their ads, the fraudsters click on the ads simply to drive up the advertiser's costs. The fraud also falsely inflated Google's revenues. The estimates on the Street, if even close to being true, could rock the stock market darling, set to announce fourth-quarter results Tuesday. "If Google were to implement a method for stopping click fraud today, it would lose 30 percent of its revenue overnight," said Joseph Holcomb, a search marketing expert. Holcomb estimates that almost one-third of all clicks on Google's network are suspect, thanks to sophisticated software programs known as "click bots" or "hit bots" that mimic human activity and fool search engines into believing the clicks are legit. With Google set to report about $6 billion in annual revenue, Holcomb's estimate would put $2 billion in top-line revenue at risk. Google denies the problem is that large. |
| | Google - No Soapbox | Stock Discussion ForumsShare | RecommendKeepReplyMark as Last Read |
|
| |
