The Death of Google?

Ha! Not hardly. That being said, Will Schroter has some interesting thoughts on how Google could fail:

The lynchpin – CPC inflation
The most successful single search engine will force all advertisers to flock there to get customers – that’s wonderful. We did that at Swapalease.com for over 4,000 words and wound up on Google’s doorstep like everyone else. Then we ended up writing them huge checks like everyone else.

But like any other market economy, the price per click began to increase as demand increased. We watched our average cost per click on Google inflate by 300% in the course of one year. Translation – our revenues are the same but our costs went up 3x.

What that drives is a significant demand on behalf of advertisers (the cash cow of Google) to look elsewhere. Things at Google are not going to get better from a cost standpoint, they are going to get worse. We’re never going to see our average CPC go back to what it was even a year ago, and next year it could double again.

Compare the inflating cost of Google to that of their Number One competitor, Yahoo. Yahoo now costs a third of what clicks on Google do for the same traffic and same conversion rate. I can’t wait to give more money to Yahoo, and that’s the problem.

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