SearchEngineLand says that online travel booking company Expedia (EXPE) lost 25% of its visibility on Google (GOOG) because of irregular SEO practices. Expedia shares slumped yesterday after the news first came out and they continue to decline today.
Google has algorithms that pick out companies trying to artificially boost search rankings. Google then penalizes the offenders in an attempt to provide information that could be most beneficial for users.
It appears that Expedia has erred on multiple counts. First, it has been generating a ton of articles with fluff content, which would be dangerous on its own, because Google penalizes sites that don’t provide good content.
But Expedia hasn’t stopped at that. It has also resorted to linking schemes (sponsoring links that would feature its services on other pages). This is a more serious offense because Google penalizes this more severely. When the algorithms discover a company has used this technique, they filter out major keywords.
As a result, there is a significant drop in rankings. Media reports have quoted SearchMetrics data that indicates a sharp drop in hits for keywords like hotels, flights and airline tickets, such that Expedia no longer shows up on the first page for these keywords.
Google usually sends a notice to the offender in case of linking schemes and the situation is resolved pretty quickly. But since the companies compete for travel searches and there is also some bad blood between them, there is more interest in the story.
Expedia's results will also likely take a hit, if the impact on Rap Genius, the last company Google penalized is any indication. Rap Genius saw a significant drop in traffic, some of which did not return at all. But Rap Genius is a startup and Expedia is still there in brand search, so maybe the effect will likely not be as bad.
Expedia shares carry a Zacks Rank #2 (Buy), better than peers Priceline (PCLN) and TripAdvisor (TRIP), both of which have a Zacks Rank #3.
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