I broke this story at Search Engine Land yesterday but now the community is picking it up and I thought the comments on this story would be fun, so heck, I think we need to cover it here too.
In short, Overstock posted their Q3 earnings, showing an 11% drop in their earnings, which they partially (but almost fully) blame on a Google algorithmic change resulting in less organic traffic, and less online sales.
Here is the quote from the earnings report and call:
That was from Overstock’s CEO and their earnings report, directly from them.
Which Google Update Hit Overstock
So I dug in and found that SearchMetrics, SEMrush and SimilarWeb all reported that Overstock saw huge declines in May 2015. Remember on May 1st I reported on a Google update that initially Google denied and then finally confirmed as not a quality update but a core search update. Well, that core search update smacked Overstock so hard that it lead to a 11% drop in earnings.
SimilarWeb, which has verified traffic data from Overstock (meaning, it is accurate) showed 24% drop in traffic from Google’s organic search results to their web site in May. Here is the chart from SimilarWeb:
SearchMetrics and SEMrush, which measure keyword rankings per site, thus estimate search volume increases and decreases, both show over a 33% decline in their search visibility:
So it seems like it was this May 2015 update that Google released.
The result, an 11% drop in earnings and a 17%+ drop in their stock price yesterday:
Now if someone made a business out of tracking public company’s rankings and buying and selling stock based on that… Well, it doesn’t always work. Remember RetailMeNot got hit, confirmed they were hit, but their stock didn’t budge even after the two earnings reports. That company was incredibly reliable on Google’s organic traffic, as is Overstock.
Back in 2011, Google penalized Overstock and then, it only hurt their stock by about 5% then. So Overstock is use to weathering the Google fluctuations.
Forum discussion at Google+, Inbound and Local Search Forums.
