Yet More Google Estimate Cuts: Big Online Marketers Slashing Ad Spending
by Peter Kafka
Posted on November 12, 2008 at 8:57 AM PT
Even more Wall Street analysts are cutting their estimates for Google (GOOG), making the reasonable argument that if the world’s economy stinks, that might have some impact on the world’s biggest media company.
Barron’s Eric Savitz summarizes the notes from Citigroup’s Mark Mahaney, Collins Stewart’s Sandeep Aggarwal and Stanford Group’s Clayton Moran. So I’ll just highlight one part of Mahaney’s argument: A check of four big online e-commerce companies–Amazon (AMZN), eBay (EBAY), Expedia (EXPE) and Priceline (PCLIN)–indicates that they’ll be making dramatic cuts in the amount they spend on Web advertising this quarter (see chart below).
“These companies are staring into what could be an ecommerce abyss and appropriately cutting back on their marketing spend, certainly including their spend with Google,” Mahaney writes.
To recap: Dollars are continuing to move from traditional media outlets online, and Google is capturing the lion’s share of that move. But even Google isn’t impervious to what’s ailing the economy right now.
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Comments
This has nothing to do with the economy. Google’s new iGoogle web features are terrible, and users are migrating back to Yahoo in droves, especially those who use financial tools. Yahoo is far surperior. Advertisers have caught on to this trend and are pulling their ads because Google is loosing market share. Watch Yahoo, advertisers will soon begin to emerge there and for a much better bang for their buck.
Posted by Donna Wannatelia at November 12th, 2008 at 9:17 amDonna, I dont say this often, but that must be some good stuff you’re smoking – no offense.
But thats nonsense.
As far as this article goes. Peter, why the need to write an article concerning an article on another site concerning some analyst down/upgrades – talk about redundancy…
Posted by Jim Gomez at November 12th, 2008 at 9:47 amReally, Jerry. Couldn’t you have come up with a better alias than “Donna Wannatelia”?
Posted by John Paczkowski at November 12th, 2008 at 9:59 amHey Jim. I was going to write up the Mahaney note but saw Eric had already done so, didn’t feel like repeating. But did want to point out the ad spend estimates, which Eric’s didn’t have.
Posted by Peter Kafka at November 12th, 2008 at 10:44 amAnd that’s my “how your sausage gets made” story for the day.