Bear Stearns analyst Bob Peck jumps on the SearchIgnite report we highlighted last week. Ignore those lousy Comscore numbers, Bob says: search spending is up 45% so far in the quarter and February spending accelerated:
Over the weekend, we spent some time with Roger Barnette, founder and president of SearchIgnite. SearchIgnite represents close to $200M in media budget from 500 major brands that investors are all familiar with. Verticals represented range from finance, retail entertainment to travel (however not pharmaceuticals).
• SearchIgnite has observed 45% growth in paid clicks from clients since the start of the year till Feb 15th, 2008. Ad spend in aggregate increased 43% YoY across all clients. In addition, February has been very strong and is improving from January.
• From a market share point of view, Google’s share has remained pretty consistent in the low 70%, with remaining 20% going to Yahoo and 5-7% to Microsoft. In addition, CPC movement has been relatively flat from end of 2007 to now. Retail has been growing very strongly with 63% YoY growth while non-mortgage finance has also been a top performer as the company does not have any sub prime clients.
• We note that SearchIgnite’s data points have historically been accurate indicators when compared to reported results from Google and Yahoo. For example, the company indicated Yahoo’s bounce back in 3Q07 and Google’s underperformance in 4Q07. As such, we think the company’s indication of Google’s bounce back in 1Q08 could have some validity.
So the Comscore report has been officially explained away, in part by Comscore. Now let’s see what happens to search spending in March. (And to the stock, which continues to drop, despite the bulls’ encouragement).