Are Google ads worth it?

ebay pulled all its ads from Google because Google is trying to compete with eBay's PayPal with a Google-branded payment system. However, that is not the story. The story is what happened after the ads were pulled: Nothing. Traffic to eBay dropped only a tiny amount, and eBay probably had a net gain because they saved money by not paying for Google ads.

I have been saying for this for several years: Google ads, for many businesses, are not worth the high prices Google charges. And this new information may hasten a time when Google is just one among many online venues for ad dollars.

There is also widespread chatter about a NY Times report that online purchases are slowing, which is to be expected. Rather than it being the end of the world, it will finally force companies that have been soaring financially on the Internet newbie phenomenon to finally adopt real fiscal management and grow up. We are NOT going to be buying everything online, and that should be good news for small and medium sized retailers who have struggled in recent years to compete against online giants like Amazon, whose business model seems to be "We'll sell anything."

I had a discussion recently with a young person recently who was complaining about not being able to find a particular clothing store, and asked her if the company had an online store. She quickly replied that she did not like buying clothes online, as it was too hard to judge fit and quality. Bingo! Online sales for the past several years have been buoyed in part by people trying it out. As they find out what works and does not work with respect to buying online, many kinds of sales (like clothing) are going to start shifting back to bricks and mortar.

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