Overstock attributes reduced growth to changes in search rankings

Posted on November 24, 2015


In its quarterly financial report, Overstock.com has admitted it was hit by a change in Google’s ranking algorithm earlier this year. Its share price quickly dropped by 18% in response to the report.

Overstock.com, which is best known for selling surplus and liquidated goods at reduced prices, has not stated which Google update was to blame, but it is thought to have been hit by Google’s “Quality Update” in May. For example, SearchMetrics shows a decline of about 30% in organic search traffic during May. This update, which is often referred to as the “Phantom Update”, involved subtle changes in how the search engine processes quality signals.

To compensate for the reduced organic search traffic, Overstock says it increased spending on advertising through sponsored searches and ad displays. This led to an 18% increase in the overall sales and marketing expenses.

Google regularly updates its algorithms to improve the experience for its users, and this can have consequences for online companies. While you can’t always predict changes to search engines, the recent trend is towards prioritising relevant, high-quality pages. This means that for a website news feed to have the desired benefit in terms of search engine optimisation, it should contain well-written news that visitors will find interesting and useful.

It can take considerable time to regularly find sources for interesting stories and write them in an engaging and technically correct manner, so many firms find it more convenient to hire a news content provider.

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