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Google: Google's Economic Impact Was $54 Billion in 2009

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For the first time ever, Google's revealed its "Economic Impact": $54 billion of economic activity for "American businesses, website publishers, and non-profits in 2009."

Though Google may be huge now, it "began life as a small business that succeeded by putting in long hours and hard work," said Claire Johnson, Google's VP of global online sales. And now, the company wants, "to help as many businesses as we can to grow."

The company is careful to note that it's made a "conservative estimate" of the impact of its tools on businesses, other Web site owners and non-profits. It's also left out the economic impact of its employees or "major products like Google Maps and YouTube."

On a state-by-state basis it's looked at how many advertisers use AdWords and AdSense, then they estimated the value these advertisers achieved from using Google's tools. This involved a conservative guess by Google's Chief Economist Hal Varian that for every $1 spent on AdWords, there's a profit of $1 back ($2 revenue), and a conversion figure of 5 clicks on search results for a business from each single click on their ads—a guess based on some academic research.

So what does this translate into? Some incredible numbers:

  • $54 billion of economic activity for "American businesses, website publishers and non-profits in 2009."
  • $8 profit through AdWords and Google search for each $1 outlay by AdWords customers.
  • For New York State alone some 114,000 advertisers and Web site publishers used Google's services.
  • These folks had $6.24 billion of "impact" generated by Google.
  • Including non-profits, Google's economic impact in N.Y. totaled to $6.3 billion
  • For California's 262,000 Google partners, the economic impact was $14.1 billion.
  • Washington's 45,000 and partners somehow converted Google's input into $2.8 billion.

The list goes on, for each state and includes data on example local advertisers, as well as basic data on employees and Google activity there too. To read the report in its entirety, as a PDF just click here—it's fascinating. And you can bet that industry analysts, economists, and hundreds of other interested parties will be poring over the data, and generating headlines from it for months.


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