Online ad rates -- across all the major search engines -- apparently tanked one day a couple weeks ago, just when the stock market went to hell and talk of a world depression heated up. Paul Edmondson, CEO of ad management platform YieldBuild.com, says his data showed a 9 percent drop in pay-per-click rates in a single day, but within a week, prices had mostly recovered.
"It's definitely come back, but it isn't where it was before," says Edmondson.
Most rate changes, says Edmondson, are far more gradual. (Pay-per-click refers to ad inventory -- often sold by search engines such as Google and Microsoft -- that is only paid for by advertisers when people click on the ads.)
"It's very unusual for a large drop to occur," says Edmondson, by email.
But it's not just pay-per-click ads that have lost their value. Rajeev Goel, president and co-founder of Pubmatic, an advertising optimization firm that tracks display ad prices, says prices on display ad inventory started deteriorating in April and May.
"It hasn't been a catastrophic drop off, but it's definitely been a steady decline," says Goel.
But even if the sharp decline in prices was a short-lived panic, if ad rates decline for a sustained period of time, many resilient ad-dependent companies, notably Google, could have a challenging fourth quarter.
