Recent reports by Adgooroo for 2008 quarter shows that Yahoo has gained +9.8% while Google and MSN have lost on their advertising with -8.5% and -6.7%.
Yahoo has managed to hold on to its advertisers and also increase to +0.03%. However, Google showed a decline of -6.4% which is considerable and MSN was the worst hit with 20% of its active clients lost in the second quarter.
The report stats that the number of ads per keyword shown in Google has declined from 6.5 to just 4.0 in the United States. This is an estimated 40% drop in advertising. However, industry analysts feel Google is on its way to bring in quality ads and eliminate less effective ads. This would result in higher click through and higher conversion rates.
Eliminating less effective ads and higher conversion rates can also make advertisers bid for higher prices. However, there could be trouble with less advertisers too. As the advertising aggression slows down, advertisers would not step up the bidding rate making the auction-based bidding system a double-edged sword.
Any thoughts on Search Advertising recession would be premature. The industry has to just wait and watch the things to come.