Google launched a new beta version of their toolbar for Internet Explorer.

There are two fundamental points to the new toolbar:

• higher average CPC

• user lock in

How is the average CPC raised?

• Similar to the Firefox counterpart, the new beta Google Toolbar for IE suggests keywords based on the search history of other searchers. This will help many searchers get where they need to go by lowering the search volume and profitability of building content or keyword lists that are largely driven off of flawed Google search queries. Instead of people getting this free or under-priced traffic more will be forced to compete for the more common search queries.

• The new toolbar also offers spelling correction suggestions. It will raise the average CPC similarly to the general effect of suggesting the more common non flawed search phrases.
• The new toolbar may also help train searchers how to search, which in essence will drive the query streams toward hyper targeted 3 and 4 word queries instead of people searching for lower lead value generic terms.

How does the new toolbar lock in users?

• Google put bookmarks in the toolbar and allows users to access them from anywhere they log in to your Google account at.

• Google allows you to create custom buttons to make their toolbar more sticky than competing services. Instead of keeping you inside a Google content network this allows you to chose what vertical sites you feel are important. I am not much of a fan of Internet Explorer, but here are some Google Toolbar SEO buttons for my good friend Jim.

What all this means to search marketers:

• It may get harder to run arbitrage based business models. ;)

• Placing bookmarks INSIDE THE TOOLBAR means Google can more certainly track another type of user feedback, and they may even be able to use that user data to augment their link analysis. Much like how Trustrank can be used to flag high authority sites with low quality link popularity for manual review, Google may augment that to include high authority sites with few site visitors and/or few site bookmarkers.
• The random walker of the web theory which PageRank was based upon could likely eventually be replaced -or at least heavily augmented- by data from the actual users of the web.
• If you have not yet started a Google account (or a few of them) it may be worth creating some such that you can leverage them down the road. Older Google accounts with longer search histories may be trusted to weight the end search results more than new accounts (similarly to how Google typically trusts old domains more than new ones).
• Get busy tagging your sites and friends sites if you have not done so yet. Don't forget to tag some legit authority sites to also keep your search profile looking somewhat legitimate and trustworthy.