After a number of quarters of growth slowdown, Google’s parent company, Alphabet, reported strong growth in advertising revenue in the second quarter of 2019.
Trends in advertising revenue. Google generated $ 32.6 billion in advertising revenue in the second quarter, an increase of 22% on an annual basis.
Advertising revenues from Google properties (search, maps, Gmail, YouTube, Play Store, shopping) were $ 27.3 billion, an increase of 24% year on year.
Google Network advertising revenue was $ 5.3 billion, an increase of 13% over the previous year.
Clicks and CPC & # 39; s. The click volume on Google properties has increased by 28% year on year, while the CPC (cost per click) on Google properties has decreased by 11% compared to the previous year.
What do these numbers tell us? After a huge increase in click volume on an annual basis during most of 2018, click growth has slowed in comparison with this over the past two quarters. As you can see in the graph below, CPC & # 39; s have been falling for years – Google had said this was largely due to mobile and YouTube. However, in the past two quarters, Google has noticed YouTube’s click and CPC growth during its revenue reviews.
Alphabet CFO Ruth Porat said: “YouTube was again the second largest contributor to revenue growth.” The company does not break out revenue for YouTube.
Lower advertising prices, at an aggregated level, are not unique to Google. For example, Facebook sees lower prices from its newer ad prices for Instagram and Stories. Also remember that these are aggregated, global numbers and may not be similar to what you see in your accounts.
Remarkable search updates. Google CEO Sundar Pichai mentioned the number of ads that came out of Google Marketing Live last quarter, along with various other Search updates, including augmented reality and 3D product images when searching, news results about full coverage and the redesigned page with mobile search results (with the black advertising label).
Pichai noted two YouTube content initiatives “that help advertisers reach a new audience”: ad-supported original YouTube series, movies, and live events available for free to users; and the more than 70 channels of YouTube TV are available to advertisers in Google Preferred.
Asked about the announcements from GML that he is most enthusiastic about as “particularly important in the longer term,” Pichai said discover discover ads and gallery ads. “I mean, they both push us to mobile-first, visually rich, compelling ad formats,” he said while expectations have been raised since “they are early days”.