AdWords Makes Up for Google's Decreasing Q3 2012 Consolidated Revenues, Says WordStream

WordStream, a software company, says that AdWords might just encourage more advertisers to take advantage of the service despite Google’s declining consolidated revenues. Learn about the team’s analysis by reading this article.

Bristol, UK -- (SBWire) -- 10/31/2012 --A leaked press release showed that Google Inc raked in 14.10 billion dollars for the third quarter of 2012. While this figure was up by 45% compared to the consolidated revenues of the multinational corporation as of Q3 2011, it was below the expectation of many analysts and investors.

As disappointing as it may seem, it should be noted that its core service, AdWords, generated millions per day. WordStream, a software company, clarified this matter through an in-depth analysis.

Basically, the study revealed that Google’s advertising revenues was more than 100 million dollars daily as of Q3 2012, which was around 10.86 billion dollars for the entire quarter. How did the Web giant pull off this impressive number? WordStream broke down the answer by showing statistical data based on the 2,600 accounts, which used its AdWords Grader tool last quarter.

Accordingly, the top ten industries that invested the most in Google’s ad service were the following:
1. Finance
2. Travel
3. Shopping
4. Jobs and Education
5. Internet and Telecom
6. Computers and Electronics
7. Business and Industrial
8. Home and Garden
9. Autos and Vehicles
10. Beauty and Fitness

The analysis also revealed that the average click-through rate (CTR) on Google Search was 3.5%, indicating that advertisers paid for 192 million clicks in a day. However, this number was down by 12.4% compared to the second quarter. On the other hand, the CTR on Display was only 0.18%, generating 45.8 million clicks and up by 13.8%.

In another note, the average cost per click (CPC) on Search was 0.53 dollars and 0.35 dollars on Display. These figures decreased by 16.5% and 18.2% (respectively) compared to Q2.

Assuming that the advertisers optimised for conversions, WordStream discovered that the standard conversion rate for the third quarter was 5.63% on Search and 4.78% on Display.

While CTRs and CPCs plummeted and investors are not impressed, the software company believes that the AdWords’ earnings through ad impression volume and click make up for the decreasing revenue. In fact, the declining cost per click might bring in more advertisers and retain the existing ones.

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