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0 pointssneilan14y ago0 comments

I feel that search queries would correlate strongly with revenue because google serves ads next to search queries. Less search queries would mean less ads served.

Also 2021 Q2 revenue from google services was 57 billion dollars which was the lions share of revenue according to the shareholder report. So yes, while Google makes money from other things, they mostly make money from search ads.

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vgeek4y ago

Number of searches will correlate, but they also have the black box of Quality Score (essentially a proxy for CTR, but they can manipulate CPCs/CPMs other ways), where they can arbitrarily set price floors for given auctions.

There are other considerations, too. Different types of ad clicks are going to have different CPCs. Think map ads vs mainline search ads vs Shopping carousel ads or click-mix by types of queries (home service queries with $15CPCs/high CPMs vs ecommerce type queries with $0.50 CPCs/low CPMs).

Non-commercial queries may grow (or shrink) at a different rate than the ones that are monetizable (pesky freeloaders! why even offer them service if they aren't able to be monetized at every interaction /s).

Maybe search volume growth is coming from APAC countries with lower CPCs/CPMs due to fewer auction participants. When you look at search/search partner CPC over time, decreases due to this may become apparent.

Or simply the CTR on ads is outpacing search volume growth (this is likely-- more clicks from the same pool)-- searches are a finite pool. Make the ads look just like content and more people will click them. Ads used to have a yellow box around them, vs now they match organic results much more closely. I had guessed maybe 5 years back they would start putting ads interspersed with the organic results like Baidu-- they're not there.... yet.

Or tricking people into initiating subsequent searches. The last few times I've used Google for commercial searches with uBlock disabled, I've been dumb enough to misclick on the related items/people also search for cluster instead of going to the subsequent page.

antihipocrat4y ago

You make a very interesting point.. I'd say that overall the better the search algorithm the more likely users would keep using your search product in the long term.

However, the algorithm needs only to be noticeably better than the next best competitor. There may be a disincentive to release a cutting edge search technology until it's necessary to stave off competition, and if you've achieved monopoly, well, perhaps there's no innovation necessary.