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How One Google Algorithm Change Can Damage A Business

Posted on the 29 May 2014 by Worldwide @thedomains

There was an article over at Motley Fool yesterday by Adam Levy that took a look at how one Google algorithm changed can ruin a business. The article discussed the recent Panda change and the effect on RetailMeNot.

From the article:

Last week, shares of RetailMeNot (NASDAQ: SALE  ) slid over 20% over the course of two days after a report from SearchMetrics found that the website’s visibility had fallen 33% on Google’s search engine. The decline came after Google released an update to its search algorithm, dubbed Panda 4.0. Considering that RetailMeNot receives approximately 65% of its traffic from search engines, this could be a huge blow to the number of people clicking on its coupon codes.

The article went on to take a look at Demand Media which it an all time low of $3.62 and has since bounced back to $4.69 today.

How and why Google subverted Demand Media
Demand Media’s most important property is eHow.com. The website accounted for 30% and 31% of the company’s total revenue in 2012 and 2013, respectively. No other property accounted for more than 10% of revenue. Last year, eHow.com acquired half of its traffic from Google searches, according to the company’s 10-K report.

Unfortunately for Demand Media and its shareholders, eHow.com is exactly the type of website Google is punishing with its Panda updates. The site’s content is often vague and uninformative. The writers usually show very little, if any, subject expertise, and viewers quickly realize the site probably doesn’t have the answers they were looking for.

Demand Media follows similar models for most of its web properties, which also rely heavily on search traffic. As a result, unique visitors across Demand Media’s sites fell from 120 million before Panda to 88 million in January 2014.

Read the full story here


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