Tuesday, 22 April 2014

Worries over advertising income causes Google shares to drop

Waseem Saddique Marketing Services in Birmingham have said that analysts are worried about Google’s ability to charge high prices for advertisements on mobile devices.

Google’s shares have dropped 5% even though the technology giant reported a first-quarter profit rise of 3%.

Google’s inability to maintain advertising prices has left investors preoccupied despite profits being reported of around £2.5 billion.

A senior Google analyst from Waseem Saddique Marketing Services has said “Decreases in Google’s shares could have a potential knock on affect on the price of mobile advertising; Pay per click (PPC) being the first thing to change.”

Google has recently sold smartphone maker Lenovo for almost $3 Billion after paying $12.5 Billion for the company less than two years ago.

It seems that advertisers are reluctant to pay as much for advertisements on mobile devices in comparison to Google’s desktop ad.

A pay per click(PPC) advertising specialist from Waseem Saddique Marketing Services has said “We expect that mobile ad prices will eventually catch up with desktop advertisements as the future will see users being able to purchase much more easily online.”

Results from Google were not the only disappointment to investors as technology giant IBM reported its lowest quarterly revenue in the last five years. IBM’s revenue dropped by 4% to $22.5 Billion. It’s been reported that this is down to the weak sales of hardware.

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