If online search is a window into what people are thinking, feeling and doing in real time, it's telling marketers one thing: Consumers are taking a break from buying and looking for deals.
Several large search agencies are signaling that the second quarter is shaping up as soft for search advertising, meaning consumers are spending less time researching, comparing and buying products online. This doesn't, of course, reflect necessities like a quart of milk or other groceries, but increasingly it does reflect the market for just about everything else, from homes and cars to books and toys.
One category that 's remained strong in the face of the slowdown is searches for Groupon-like deals, coupons and other discounts. "I think consumers are very focused on deals, and what's different today [from] a year ago is you don't have to go to Google or Bing to do those searches," said Chris Copeland, president of Group M Search.
Google doesn't report second-quarter earnings until July, but several large search firms are saying the first two months of the quarter -- April and May -- were tracking behind expectations.
"We saw search slow quite a bit," said Covario CMO Craig McDonald, who's seeing growth of just 3% to 4% year-to-year in the U.S., primarily among high-tech and consumer-electronics companies. That's coming off a particularly strong first-quarter, driven by a holiday shopping season that 's extending further into January.
Fewer clicks mean fewer commercial searches and less spending, indicating caution on the part of the consumer. Economists are starting to look at search spending as an important indicator of consumer sentiment.
Most of the large search firms stressed that the sky is not falling in search as it did in 2008. As search matures as a channel, it has started to follow pretty predictable seasonal patterns. The fourth and first quarters are strongest and for the past few years, spending has reliably stepped down from the first to second quarters. With not a lot riding on the second quarter, marketers tend to experiment with their marketing mix.