According to Hitwise, E-bay’s traffic was not affected by removing advertising from Google. See article on AdAge.com for details: EBay Yanks Google Search Ads, Yet Traffic Rises
Hitwise has been reliable in the past from my experience, so I will assume that their statistics are correct for now. Whether this is accurate or not, I do not know or care.
I am more concerned that EBay would not know what the impact would be. Does one of the most visited sites in the world not have analytics? Do they know where their traffic is coming from?
Coming from someone who relies on site analytics to make every marketing move, offline and online, I can not understand how that can happen.
Of course the other angle could be … they did know what the impact would be, by analyzing traffic vs. cost vs. conversion. However, I am not sure if EBay cares about cost per conversion. They have a “Seller” audience to report to, that is their customers. They do care about traffic and so do their customers.
What does all this mean? Well, first it is too early to tell. It is only one week of data. That is not a big enough sample to make any assumptions. If it turns out that their traffic is not affected, then E-bay has a much more serious problem on their hands. Why did it take them so long to pull the ads?
EBay has spent millions of dollars on Google advertising over the years. Evidently that was a waste of money and made no impact on revenue or traffic. That means that someone in their marketing team has serious explaining to do.
*** Updated June 23, 2007 ***
It turns out that E-bay was affected by being removed from Google advertising for 10 days. Of course, E-Bay would never admit that.
“We found that we were not as dependent on Google AdWords as some may have thought,” said EBay spokesperson. “By re-allocating our marketing dollars to our other partners, such as Yahoo, AOL and MSN, we were able to increase traffic and find efficiencies that will enable us to drive more value to our sellers and partners going forward. We are now slowly turning AdWords back on, in a much more limited way than before.”
Logically, that makes perfect since. It is a great idea to diversify. But let’s face, Google must have a significant impact on EBay’s business. By going back to the Google, they are acknowledging this.
However, that’s okay. That’s nothing to be ashamed of. Not only does Google advertising have an impact on EBay’s, but E-bay is one of Google’s largest advertisers. It’s a mutual exchange where both parties benefit.
Of course, Google definitely benefits more from this arrangement. EBay must have terrible analytics and a terrible way to measure return on pay-per-click spend. Therefore, Google will always have the upper hand.
As any expert in pay-per-click marketing will tell you, pay-per-click is NOT expensive if you can measure ROI. By knowing what is bringing in revenue and what is just brining in visitors, marketers can have the upper-hand in the relationship. In this case, EBay does not have those strong tools needed to make wise decisions with online marketing dollars.
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