Google Revenue Jumps 70%
While competitor Yahoo, reporting a 38% drop in revenue, echoes doubt about the sustainability of online advertising, Google is rolling out the barrel. Google reports that its third quarter revenue has risen to $2.69 billion. That amounts to 70% greater than 2005, and 10% more than last quarter, exceeding Wall Street expectations. $1.63 billion of that came from ads on Google-owned sites, while $1.04 came from its AdSense program. 44% of revenue came from non-US sources. The revenue jump caused Google’s net income to increase by 92%.
Google CEO Eric Schmidt attributes the recent success to a number of factors, including strategic partnerships. “We were particularly pleased with the contributions of our international business in a seasonally weaker quarter. In addition, we continued to forge significant partnerships with companies such as eBay, Fox Interactive Media, and Intuit that will be of great value to all involved.”
He also called the purchase of YouTube the “ultimate partnership” in a conference call to analysts and emphasized the importance to Google of video advertising and partnerships with video content providers.
Google remains dedicated to keyword search. The design of the Google homepage remains primarily dedicated to keyword search. Google continues to be rewarded for this exclusivity and for delivering users what they want uncluttered, content-relevant search results.
Yahoo, MSN, and so many other so-called leading search engines are still too busy trying to be all things to all users. Their homepage design is cluttered and crowded and their search results delivery systems are still quite weak, in comparison to Google.
Google embraced search and grew with the second most popular internet activity. Other players in the online marketing industry are still scrambling to connect with millions of users.
Google’s dedication to keyword search, the most effective form of online advertising and quite possibly, the most effective form of all advertising mediums is the glue to their success.
Dedication to and understanding of the keyword search medium, factored with confused and strung out competitors, could make Google the top company in the world.
That said, every company has a downside, even Google, as Click fraud continues to escalate. Senior executives at Google have to address click fraud and suspect web advertising activities from many of their partners, sooner rather than later. The days of ignoring click fraud and sweeping it under the rug are rapidly coming to a close.
As budget allocations increase expectations and requirements also rise. Google clients need new click fraud quality controls that protect their ROI and ensure that recent SEM budget windfalls are sustainable for years to come.
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