Reduced Click Area Yields Lower Profits

Due to a shocking  below-expectations profits margin for the fourth Quarter, Google saw shares tumble, losing $11,000,000,000 in market value (yes, that is $11 Billion!). While I am certain that the down-turning economy played at least some role, I think that a new ad-system by Google may have also been responsible. In the final quarter of 2007, Google altered that ad-block for its popular cash-cows, Ad-Sense and Ad-Words, allowing only the title itself to be “clickable”. Previously, any part of the advertisement – the Title, Description, or Display URL – would trigger a hit if clicked upon by the user. As was outlined by the good folks at Efficient Frontier, and certainly backed up by our own statistics over especially the December...