Wiseaff

E-Commerce Still Growing, but a Bit Slower

comScore reports that Year over Year increases in e-commerce spending is still growing but the high growth rates of from last year have slowed a bit.  Here is the data:

Month             Y/Y Percent Change
Apr-07                 18%
May-07                 25%
Jun-07                 25%
Jul-07                 22%
Aug-07                 28%
Sep-07                 19%
Oct-07                 19%
Nov-07                 20%
Dec-07                 18%
Jan-08                 12%
Feb-08                 14%
Mar-08                  9%
Apr-08                 15%

April's e-commerce growth rate was only off 3% from the prior year, and I think this indicates that online spending will be where people go to look for deals as the economy falters.

The Google Numbers Story

Google reported better than expected earnings and their stock price jumped 20%, then the analysts started pointing fingers at comScore saying that their numbers predicted lower than expected earnings based on comScore's PPC trends research that showed a slowing in paid clicks.

Today, comScore released the following press release defending their numbers and pointing out that the analysts used comScore's numbers wrong which showed domestic Paid clicks slowing to draw conclusions about Google's worldwide growth.

Here is the release, it's an interesting read:

When Google announced strong Q1 earnings last week, some financial and media analysts wrote that comScore’s reports of slowing growth in Google’s paid clicks missed the mark. That conclusion is patently false.

Unfortunately, many pundits attempted to draw conclusions about Google’s worldwide revenue performance based on comScore’s domestic paid click data, resulting in an apples-to-oranges comparison. Had they used comScore's domestic paid click data to better understand Google's domestic revenue trends, they wouldn't have missed an important U.S. story and they also likely would have avoided making the wrong call on Google’s worldwide business.

Following several historical quarters of strong sequential domestic revenue growth (including the seasonally equivalent Q1 2007), Google’s Q1 2008 revenue growth was essentially flat, which represented a significant change for Google’s domestic business. Such an important trend was also evident in comScore’s paid click data.

The chart below shows the directional association between comScore’s domestic paid click trends, as compared to Google’s domestic revenue trends.

Of course, this is not a perfect correlation because the comScore data do not include the impact of changes in Google’s price per click and do not include paid clicks from partner sites like AOL, Ask, Washington Post, etc. nor paid clicks from the AdSense network. But the strong relationship of the two trends is undeniable.

There is of course a lesson to be learned here. To extrapolate a single data point across all aspects of a company's business can lead to wildly inaccurate conclusions. 

Finally, to confirm the accuracy of the comScore paid click data, we previously published an apples-to-apples reconciliation on this blog. This analysis reconciles the comScore data with metrics shown in Google’s Q1, 2008 financial report. In short, comScore got it right – both quantitatively and qualitatively. What was wrong were the conclusions that some people drew based on inherently flawed comparisons.

Dr. Magid Abraham

President and CEO

comScore, Inc

Happy 9th Birthday Google!

Wow, Google is 9 years old already!  With a market cap today of $177 Billion that's just $19 Billion a year!  Not to shabby! 

Happy Birthday GOOG!

Is Affiliate a 4-Letter Word?

The term "affiliate" has and continues to come under much debate.  Should what we do be called "Affiliate Marketing"?  Are we affiliates, publishers, or advertisers?  As a paid search affiliate, all I really do is advertising.  Who is the advertiser, us, our merchant partners, or both of us?  We both buy advertising to promote the partner's products and services.

One of my super affiliate cohorts, IM'ed me about wiseaff, and said, "Why AFF, isn't that a bit restrictive?".  It made me stop and think.  Why does the term "affiliate" leave a bad impression?  Should it?

Like it or not, we are in the affiliate marketing business.  We can try and call it performance marketing, CPA marketing, acquisition marketing, pay for performance marketing, post-paid marketing, or cost of goods sold marketing, all we want, but that is not how the industry has defined us.

Should we embrace the affiliate term and work on educating greater corporate America on the many benefits of using this large network of high performers to market their products and services and only get paid for the results they generate?

Personally, I don't care what we end up calling ourselves, so long as our partners and the executives at their companies understand the value we are brining to the table and are willing to sit down with us, as partners, to determine what a win-win relationship looks like.

Embrace your inner AFF folks!  If you are getting paid commissions for your marketing efforts, you’re an AFF!