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7/19/2007
  Goog Q2 2007: Why They Missed

A Google Miss. The second in their history (Remember Q4 2005?).

I can't say I'm surprised at the miss, because Google eliminated a lot of advertiser spend this quarter with their ad quality improvements. In short, they kicked a lot of advertisers out of AdWords.

By focusing on the worst of the arbitrage, and made-for-adsense type sites, they took a hit. These were the sites that would basically consist of all ads, and so when a user clicked away from a Google ad, they'd go to another site, full of ads. Not the best experience. By eliminating those types of advertisers from the system, they cost themselves money in the name of "better" ads.

I'm sure they planned it - and I'm guessing they look at it as a kind of "weeding the garden". It's hard work, and it cost them this quarter, but they believe they'll have higher quality results, and happier users in the long run...

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