Current economic conditions include inflated gasoline prices, a crashing stock market, horrible real estate conditions, increasing unemployment and a miserable economic outlook. How might this impact the PPC Advertising Industry?


Let’s review some unsettling economic facts:PPC Advertising News

  • Last week, the U.S. Bureau of Labor Statistics reported a net loss of 62,000 payroll jobs in June, marking the 6th straight month of job shrinkage.
  • Payroll employment has fallen by 438,000 jobs year-to-date, and there were an estimated 8.5 million jobless workers seeking employment last month, compared with 7 million a year ago.
  • The stock market is off by 17% this year, the worst performance since 1970.
  • Fuel costs $4+ per gallon, representing a nearly 100% increase in 3 years.
  • Housing values are down across the country with U.S foreclosure increasing 53% year over year and bank repossessions nearly tripling.
  • The value of the dollar continues to deteriorate for the 6th straight year, losing roughly half of its purchasing power compared to major trading partners.

This certainly does not appear good on the surface, and that’s because it isn’t. Many economists speculate that things will start to improve in 2009. I and countless others hope they are correct. Though times may be getting tougher, we are fortunately nowhere near the levels of “The Great Depression” where in 1933 unemployment reached over 23%, compared to 5.5% today. Furthermore, the stock market plummeted more than 75% at that time and banks were going out of business and uninsured… Not Good!

Fortunately, the PPC Economy appears a bit more stable, at least for now. There is no doubt that business owners are going to be taking a closer look at their advertising budgets, but despite the slowing economy, people are still searching the Web with increasing regularity, providing a valuable and expanding marketplace for PPC advertisers. Based on JumpFly’s client base of 300+ PPC advertisers, there was no indication of an overall slowdown in PPC Advertising spending over the past 6 months. There have been an increasing number of clients expressing concern about the economy, but actual PPC spending has not been reduced. In fact, U.S. online advertising is poised to grow 22.7% in 2008, though this is less than the 32.7% growth previously anticipated. Furthermore, an economic downturn may even prove to offer some unique PPC Advertising opportunities, which I will visit in next week’s blog.

Per Henry Blodget, co-founder of Silicon Alley Insider and someone whose opinion I greatly respect, “New or developing media–those that still are growing more quickly than advertising expenditures as a whole–exhibit fewer recessionary effects than traditional media. More specifically, advertising spending on “new media” does not decline before, during, or after recessions, it simply grows less quickly than during normal years. This trend was clearly visible in the growth of television advertising during the recessions of the 1950s and 1960s, and in the growth of cable advertising during the 1990s.”


PPC Advertisers everywhere will be delighted to find that Google AdWords now includes actual search volume numbers at their Keyword Tool. Accurate search query data is now included, instead of the vague graphic bar that was previously used to indicate search volume. Thanks Google! We appreciate it. This makes the Google AdWords Keyword Tool an even more valuable resource for keyword research and discovery.