Google Inc (NASDAQ:GOOGL) is suffering in its core business and its investors are starting to fret about this. An article on Business Insider took a look on the reasons as to why Google Inc (NASDAQ:GOOGL) stock is unable to recover and continuing its path towards decline since years. The source identified the declining cost per ad click as the real reason. Google’s main business is online ads. The source said that everything was working great for Google Inc (NASDAQ:GOOGL) when suddenly, the mobile business popped-up in the world.
Google Inc (NASDAQ:GOOGL)’s dilemma started when it found out that soon, its monopoly in the ads domain would be over because most of the people will be accessing the internet and websites from the mobile devices whereas the search engine giant designed and created ad campaigns only for desktop computers. But Google found a way for this: it told the advertisers that they should continue to pay the company for ads campaigns and Google Inc (NASDAQ:GOOGL) will show their ads on the websites both on mobile and desktop. But the matter was not easy as it looked.
The problem was solved at the Google Inc (NASDAQ:GOOGL)’s end, but thousands of advertisers who had their online web stores made for the desktop interface didn’t update their websites for mobile. This created a problem for the end visitors because when he clicked the ads on mobile, he was linked to a website which was not responsive. When advertisers didn’t see the fruits of their Google ad campaigns, they decreased their click rates.
The source said that people are now finding ways to shop from the internet without even opening the Google Inc (NASDAQ:GOOGL) search.
David Tepper’s Appaloosa Management Lp owns around 600,000 Google Inc (NASDAQ:GOOGL) shares.
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