Google's drop in paid clicks: Part of the grand plan

Company exec tells media conference the decline is due to an initiative aimed at reducing the number--while increasing the quality--of paid listings.

Richard Defendorf Staff Writer

After ComScore reported a recent decline in Google's paid clicks, the Net ratings service followed up, noting evidence that the drop was due to "Google's own quality initiatives that result in a reduction in the number of paid listings and, therefore, the opportunity for paid clicks to occur."

The reduction in listings, ComScore noted, was "offset by paid revenue per click."

On Monday, at a Bear Stearns media conference in Palm Beach, Fla., Tim Armstrong, Google's president of advertising and commerce in North America, offered essentially the same view on the matter.

As noted by ZDNet Editor in Chief Larry Dignan, Armstrong emphasized that the dip in paid clicks was intentional--part of a strategic plan designed to deliver better, more-precisely targeted ads. Thus, the market anxiety that hit Google's stock was, well, unjustified.

OK then, but Dignan also cites Armstrong's acknowledgment that "search is changing overall in general" and tends to reflect macroeconomic conditions--an acknowledgment, Dignan points out, that suggests Google isn't recession-proof.

Google also told conference attendees that it won't be developing its own content, that it will increase the number of videos and ads on YouTube, and that the company's system won't differentiate between search and display ads over time.

Google's general theme is to offer advertisers a complete dashboard with multiple forms of advertising. Armstrong also noted that Google will deliver ads on social networks via widgets and social-networking apps.