Google Trends – Can it Help Predict Market Behavior?

What is Google Trends?

Google Trends is an online search tool, based on the Google Search engine. Google Trends shows how often a particular search-term is entered relative to the total search-volume across the Internet, over a given period of time (usually 2004 through the current year period). In layman’s terms, Google Trends lets you see what other people have been searching for on the web.

While recently performing research on various technology trends, I stumbled upon an article by James Maguire, entitled: “Google Trends Reveals Which Tech Trends Are Hot (Or Not).” In the article, James Maguire revealed that a lot of what happens in the information technology industry can be predicted by following the trends over a period of time.

Here are the excerpts from his first paragraph:

“Google Trends, a kind of a search engine within a search engine, reveals the popularity – or unpopularity – of a given search keyword. Its results reflect mega-patterns of what people are thinking about (if you accept the thesis that Internet searches equal the public’s level of interest).”

I decided to use Google Trends to put his argument to the test. To test out the above theory, I performed a couple of searches using search terms that when compared together, would provide a trend line of how often information related to that search term was requested within Google. The data shows the search volume from 2004 through 2013.

Search #1 – Certification Trends (IT Certs, Ms Certs, IT Training, etc.)

Keywords used: 1. IT Certification, 2. Microsoft Certification, 3. IT Training

Observations: One could conclude that while the interest in IT Training and learning has remained flat for nearly 10 years, the popularity of formal certifications has declined. I remember the days, when companies would hire virtually anyone that had an MCSE (Microsoft Certified System Engineer) certification.

However, as the years went by, companies began to realize that many of the people, while they were certified, had little (if any) real work experience in the industry. Thus the term “Paper MCSE” became popular.

As a result, companies began confirming the experience levels of candidates with MCSE’s by putting them through all kinds of additional testing, to ensure that they were getting their money’s worth.

When people began to realize they needed more than a piece of paper to land a well paying tech job, the popularity of many IT certifications began to lose their appeal. I’d like to call it, “the market correcting itself.” One could draw additional conclusions, but that is what jumps out at me at first glance

Search #2 – The Decline of Desktop Sales versus the increase in interest of Laptops, general Tablets, mobile phones and the Apple iPad.

Keywords used: 1. Laptop, 2. Desktop, 3. Tablet, 4. iPad and 5. Mobile Phones

Observations: The above graph shows the search interest of Desktop Computers, to Laptops, Tablet PC’s and the Apple iPad. We can quickly see that searches or interest has been on a steady decline over the past 10 years, while laptops have seen an increase starting around 2007. You also notice that popularity of laptop searches leap-frogs the desktop around 2008.

What is also clearly evident is the explosion of interest of the tablet PC, but especially the Apple iPad at the end of 2009. One could also conclude that the search interest in laptops has been adversely affected by the rise in popularity of tablet computing, note the decrease that also begins in 2009.

What I did not expect to see, was how flat the interest is in mobile or smart-phones. The interest has virtually been unchanged over all these years. This comes as a surprise to me.

Trend versus Real-World

Recent reports by Statista.com, predicts a steady decline in Global desktop PC sales, with laptops remaining flat or increasing slightly from 2010 to 2015. While the same report shows the tablet PC increasing dramatically over the same period of time.

To further confirm the Google Trends, the graph below shows a decline in the sales of Desktop computers in the U.S. market form 2005-2010, with sharp declines beginning in 2008.

You will find more statistics at Statista

What Do You Think?

Here’s what I think… If search behavior is any indication of real-world market trend, then Google Trends is a good tool to use, if you want to get a sense of what is happening in the real world.

What are your thoughts? What conclusions would you draw? What did I miss and how do you see things? Please leave your comments concerning Google Trends.