The Google Finance blog has announced a new set of tools for analyzing search volumes called Google Domestic Trends on Google Finance.
How Google Domestic Trends works:
Google Domestic Trends tracks Google search traffic across specific sectors of the economy. The changes in the search volume of a given sector on google.com may provide useful economic insight. We have created 23 indexes that track the major economic sectors, such as retail, auto and unemployment. Each index value is baselined at 1.0 on January 1, 2004 and is calculated and displayed on the Google Finance charts as a 7-day moving average. You can easily compare actual stocks and market indexes to these Google Trends on the charts.
The 23 categories available in Google’s Domestic Trends tool are: Advertising & marketing, Air travel, Auto buyers, Auto financing, Automotive, Banking & personal finance, Business, Computers & electronics, Construction, Credit & lending, Durable goods, Finance & Insurance, Furniture, Industries, Investing, Jobs, Luxury goods, Mortgage, Real estate, Rental, Retail trade, Travel and Unemployment.
The Google Advertising and Marketing Trends Index which tracks queries related to “marketing, do not call, advertising, signs, logo, commercials” etc. illustrates both the marketing industry’s peaks and troughs since 2004.
Interestingly, the lowest point in the index was reached in January of this year while the highest point since early 2005 was reached September 4 of this year.
The Advertising and Marketing Trends Index probably peaked as a result of increased advertising and marketing spending by the auto industry on the cash for clunkers program.
Google’s index data can be compared with actual stocks, the Dow Jones, or Nasdaq by entering the respective tickers in the Compare box.
Below, I have generated a Google Advertising and Marketing Trends chart comparing the performance of the Dow Jones, S&P 500, Nasdaq, Google (GOOG) and the New York Times (NYT).
While the indexes have remained in a relatively narrow trading range, Google and the New York Times stock have not. Google stock has climbed 350% while the New York Times Company stock has fallen 79% over the same time period.
Evidently, now is not the time to be in the content creation business.
Google Insights for Search provides more detailed information about the ten search categories that compose the Google Domestic Trends Index on a country by country or worldwide basis.
Additionally, Insights for Search now also provides a forecast for each of the 23 Domestic Trends.
In the case of the Advertising and Marketing Index, Google forecasts a 47% drop in US Advertising and Marketing activity for December 2009 compared to December 2004.
Google forecasts a 43% drop in Worldwide Advertising and Marketing activity for December 2009 compared to December 2004.