Wednesday, March 17, 2010

Quick Update On Google – Mobile & China [citibank research] $GOOG (great Report)

  • Google’s Mobile Ad Enhancements Include: -- 1) An easier AdWords interface where marketers can pick between different phones, carriers, etc.; 2) Click-to-Call which was rolled out last month; and 3) Local Layered Ads (experimental), where

  • users can add favorite brands to their Google Maps. One of the biggest takeaways was management’s stated belief that CPCs and CTRs on the mobile phone could, in the future, be equal to or greater than CPCs and CTRs on the PC.

  • Our Long Thesis On GOOG Remains: 1) There is still significant secular growth ahead for Internet Advertising, given that only approximately 10% of global advertising/marketing dollars are currently online; 2) Search has been and remains the most dynamic/best growth segment of Internet Advertising, and Google is the clear market share leader/gainer in this segment; 3) Google’s option value in terms of other Internet Advertising segments – Mobile, Display, Video – is increasingly becoming material; 4) As a heavily fixed cost model, Google presents very well as a Cyclical Recovery play; 5) Relatively newfound cost efficiencies have combined with 4 to create an outlook for modest – but sustained – margin expansion; and 6) Google management has increasingly proven itself to be in the class of the sector’s best.

Quick Update On Google – Mobile & China

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