A Little Bit Of History Repeating

Traffic drops on Facebook. Google reports a flat quarter. New listings on eBay drop by 13%. Surely, no one has ever seen anything like this, and there can be only one explanation: Armageddon.


That's certainly the conclusion I would come to based on Web coverage of these events. Consider this headline from Silicon Alley Insider: "Google Bulls Try to Spin Comscore Disaster, Fail."

But is disaster still disaster when it's inevitable?

Because, really, every one of these events is inevitable.

For traffic to grow indefinitely on Facebook, it will need to keep the users it has got, continually add new users, and ensure that people continue to spend more time on the site. Ultimately, it will have to report stats that will read like the election results in a dictatorship: "130% of the world population is now using Facebook an average of 47 hours a day."



Google will become the world's largest economy, and will subsume every other economy, leaving no money left to buy any of the things offered by its advertisers. Its only advertiser, of course, will be eBay, which will have become the exclusive marketplace for every item in the world that is bought and sold. It's just not possible. And yet we're shocked when performance doesn't continue to grow at its historical pace. Despite every one of us having a more than passing familiarity with the phrase "history repeats itself," we continue to harbor expectations that the world will continue tomorrow much as it is today.

There are those who see the patterns and remain unfazed. Marketing Pilgrim's Jordan McCollum, for example, injected a much-needed voice of reason into the conversation with her sensible admonishment: "Guys, this stuff happens. Economies just can't grow all the time."

Jordan's view on the matter represents the difference between luck and wisdom. Lucky people succeed in a bull market and think they're wise. Wise people take advantage of a bull market because they know they won't always be so lucky.

Visionary leaders understand the cyclical nature of economics -- and the rest of human behavior, for that matter. They don't assume that the favorable market conditions that gave rise to their success will continue to exist five or 10 or 20 years from now, and they anticipate what their reaction will be once those conditions turn against them.

The FB/GOOG/eBay dips might be just that, brief wobbles in their journey to greater success. Or they might be harbingers of a much bigger downturn in the weeks and months to come -- a repeat of the medicine history already gave us in the year 2000.

So what does all of this mean for the search industry? Well, there are the direct implications, of course: how Google's policies shift to reflect its changing environment, for example. It remains to be seen whether search can be monetized on a Facebook that nobody visits, even though it couldn't even be monetized when people did visit. And eBay will likely become ever more protectionist about paid search results that point to proprietary content.

But the lesson here is about the bigger picture. It's about taking a step back and realizing that a model that relies on the status quo is not a long-term model. It's about realizing that the ability to anticipate these cycles can be the critical distinguishing factor between a company that lasts a decade and one that lasts a century.

It's all just a little bit of history repeating.

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