Huge Update

Google recently launched their webspam Penguin update. While they claim it only impacted about 3.1% of search queries, the 3.1% it impacted were largely in the "commercial transactional keywords worth a lot of money" category.

Based on the number of complaints online about it (there is even a petition!) this is likely every bit as large as Panda or the Florida update. A friend also mentioned that shortly after the update WickedFire & TrafficPlanet both had sluggish servers, yet another indication of the impact of the update.

Spam vs OOP

Originally leading up to the update, the update was sold as being about over-optimization. However when it was launched it was given no pet name, but rather given the name of the webspam update. Thus anyone who complained about the update was by definition a spammer.

A day after declaring that the name didn't have any name Google changed positions and called the update the Penguin update.

Why the quick turn around on the naming?

If you smoke a bunch of webmasters & then label them all as spammers, of course they are going to express outrage and look for the edge cases that make you look bad & promote those. One of the first ones out of the gate on that front was a literally blank blogspot blog that was ranking #1 for make money online.

As I joked with Eli, if it is blank then they couldn't have done anything wrong, right? :D

Another site that got nailed by the update was Viagra.com. It has since been fixed, but it is pretty hard for Google to state that the sites that got hit are spam, blend the search ads into the results so much that users can't tell them apart & force Pfizer to buy their own brand to rank. If that condition didn't get fixed quickly I am pretty certain it would lead to lawsuits.

Google also put out a form to collect feedback about the update. They only ever do that if they know they went too far and need to refine it. Or, put another way, if this was the Penguin update then this is GoogleBot:

So Worried About Manipulation That They Manipulate Themselves

When I was a kid I used to collect baseball cards. As the price of pictures from sites like iStockphoto have gone up I recently bought a few cards on eBay (in part for nostalgia & in part to have pictures for some of our blog posts). Yesterday I searched for baseball card holders for mini-cards & in the first page of search results was:

• a big ecommerce site where the review on that product stated that the retail described the quantity as being 10x what you actually get (the same site had other better pages)
• a user-driven aggregator site with a thin affiliate post made years ago & attributed to a site that no longer exists
• a Facebook note that was auto-generated from a feed
• an old blogspot splog
• a broader tag page for a social site
• a Yahoo! Shopping page that was completely empty

That blank Yahoo! Shopping page is also what showed up in Google's cache too. So I am not claiming that they were spamming Google in any way, rather that Google just has bad algorithms when they rank literally blank pages simply because they are on an authoritative domain name.

The SERPs lacked expert blogs, forum discussions, & niche retailers. In short, too much emphasis on domain authority yet again.

Part of the idea of the web was that it could connect supply and demand directly, but an excessive focus on domain authority leads users to have to go through another set of arbitragers. Efforts to squeeze out micro-parasites has led to the creation of macro-parasites (and micro-parasites that ride on the macro-parasite platforms).

SEO-based Business Models

Now more than ever SEO requires threading the needle: being sufficiently aggressive to see results, but not so aggressive that you get clipped for it (and hopefully building enough protection that makes it harder for others to clip you). That requires a tighter integration of the end to end process (tying efforts into analytics & analytics back into efforts) & a willing to view SEO through a broader marketing lens & throwing up a number of hail marry passes that likely won't on their own back out but will give you a lower risk profile when combined with your other stuff.

And your business model is probably far more important than your SEO skill level is. Imagine running a consulting company for a lot of small business customers for a few hundred Dollars a month each, based on stable rankings & then dealing with a tumultuous update that hits a number of them at the same time. And then they see an older (abandoned even) competing site of lower quality with fewer links ranking and they think you are selling them a bag of smoke. These sorts of updates harm the ability to do SEO consulting for anyone who isn't consulting the big brands. Yes many people made it through this update unscathed, but how many of these sorts of updates can one manage to slide through before eventually getting clipped?

The Unknowable Future

As search evolves, invariably anyone who is doing well in the ecosystem will at some point face setbacks. Those may happen due to an algorithm update or an interface change where Google inserts itself in your market. If you never get hit, it means you were only operating at a fraction of your potential. If you consistently get hit, you might be aiming too low. Many trends can be predicted, but the future is unknowable, so set up a safety cushion when things are going well.

This year Google has moved faster than any year in their history (massive link warnings, massive link penalties, tighter integration of Panda & now Penguin) & the rate of change is only accelerating. Go back about 125 years and a candle wick adjuster was cutting edge technology marketed as brand spanking new:

Blekko has a decently competitive search service which they manage to run for only a few million a year. As computers get cheaper & Google collects more data think of all the different data points they will be able to layer into their relevancy algorithms. In some markets Chrome has more marketshare than Internet Explorer does & Android is another deep data source. And they can know what user data to trust most by tracking things like if they have a credit card or phone verified on file & how often they use various services like Gmail or YouTube. Google+ is just icing on the cake.

At the same time, they need to improve. As the search algorithms get better, so do the business models that exploit them:

I asked Kristian Hammond what percentage of news would be written by computers in 15 years. “More than 90 percent.”

There will be many more casualties in that war.

Sorry I haven't blogged as much lately, but one of our employees recently had a child and Google sending out so many warning messages in webmaster central has created a ton of demand for independent SEO advice. Our growth in demand last month was higher than any month outside of the time a few years ago when we announced we would be raising prices and got so many new subscribers that I had to close down the ability to sign up for about 3 or 4 months because there were so many new customers.

Google has been firing on all cylinders this year. They did have a few snafus in the press, but those didn't have any noticeable impact on user perception or behavior & Google recently rolled out yet another billion Dollar business in their consumer surveys.

Google is doing an excellent job of adding friction to SEO & managing its perception to make it appear less stable, less trustworthy and to discourage investment in SEO. They send out warnings for unnatural links, warnings for traffic drops, and even warnings for traffic increases.

Webmaster Tools is a bit of a strange bird...

• Any SEO consultant who has client sites tied into Webmaster Tools makes it easy to connect them together (making any black swan editorial decisions far riskier).
• Any SEO company which has clients sign up for their own Webmaster Tools account now has to deal with explaining why things change, when many of the changes that happen are more driven by algorthmic shifts (adding local results to the SERPs or taking them away, other forms of localization, changing of ad placement on the SERP, etc.) than by the work of the SEO. This in turn adds costs to managing SEO projects while also making them seem less stable (even outside of those who were use paid link networks). Think through the sequence...
  • Google first sends a warning for traffic going up, and the SEO tells the client that this is because they did such a great job with SEO.
  • Then Google sends a warning for traffic dropping & the client worries that something is wrong.
  • The net impact on actual traffic or conversions could be a 0, but the warnings amplify the perception of changes.
• Any SEO who doesn't use Webmaster Tools loses search referral data. It first started with logged in Google users, but apparently it is also headed to Firefox. Who's to say Google Chrome & Safari won't follow Firefox at some point?

Google has changed & obfuscated so many things that it is very hard to isolate cause and effect. They have made changes to how much data you get, changes to their analytics interface & how they report unique visitors, changes to how tightly they filter certain link behaviors, they have rolled in frequent Panda updates, and they have nailed a number of the paid link networks.

BuildMyRank shut down after leaving a self-destructive footprint that made it easy for Google to nuke their network, and some of the remaining paid link networks are getting nailed. Some of their customers are at this point driven primarily by fear, counting down their remaining days as the sky is falling. Fear is an important emotion designed to protect us, but when it is a primary driver we risk self-destruction.

The big winners in these moves by Google are:

• Google, since they grant themselves more editorial leeway. If everyone is a scofflaw then they can hit just about anyone they want. And the organic search results are going to be far easier to police if many market participants are held back by a fear tax.
• Larger businesses which are harder to justify hitting & which can buy out smaller businesses at lower multiples based on the perception of fear.
• Sites which were outranked by people using the obvious paid links, which now rank a bit better after some of those paid link buyers were removed from the search results.
• SEOs who out others & market themselves by using polarizing commentary (at least in the short run, whereas in the long run that may backfire).
• Those engaging in negative SEO, which sell services to smoke competitors.

The big losers from these Google moves are:

• some of the paid link networks & those who used them for years
• under-priced SEO service providers who were only able to make the model work by scaling up on risk
• smaller businesses who are not particularly spammy, but are so paralyzed by fear that they won't put in enough effort & investment to compete in the marketplace

One of the reasons I haven't advocated using the paid link networks is I was afraid of putting the associated keywords into a hopper of automated competition that I would then have to compete against year after year. Even if you usually win, over the course of years you can still lose a lot of money by promoting the creation of disposable, automated & scalable competing sites. If you don't mind projects getting hit & starting over the ROI on such efforts might work out, but after so many years in the industry the idea of starting over again and again as sites get hit is less appealing.

It is not just that the links are not trusted, but now they stand a far greater chance of causing penalties:

Dear site owner or webmaster of ….

We’ve detected that some of your site’s pages may be using techniques that are outside Google’s Webmaster Guidelines.

Specifically, look for possibly artificial or unnatural links pointing to your site that could be intended to manipulate PageRank. Examples of unnatural linking could include buying links to pass PageRank or participating in link schemes.

We encourage you to make changes to your site so that it meets our quality guidelines. Once you’ve made these changes, please submit your site for reconsideration in Google’s search results.

If you find unnatural links to your site that you are unable to control or remove, please provide the details in your reconsideration request.

If you have any questions about how to resolve this issue, please see our Webmaster Help Forum for support.

Sincerely,

Google Search Quality Team

If that doesn't change then negative SEO will become a bigger issue than paid links ever were.

What is hard about Google penalizing websites for such links is that it is cheap & easy for someone else to set you up. Shortly after Dan Thies mentioned that it was "about time" to Matt Cutts on Twitter someone started throwing some of the splog links at his site. It is safe to say that Dan didn't build those links, but there are many people who will be in the same situation as Dan who did nothing wrong but had a competitor set them up.

And there is no easy way to disconnect your site from those types of links.

If you go back a few years, it was quite easy to win at SEO by doing it in a "paint by number" fashion. One rarely got hit unless they were exceptionally excessive and stuck out like a sore thumb.

But after all of Google's recent moves, a few missed steps in a drunken stupor can have the same result.

Now more than ever, patience is a virtue!

Since it took me a few hours to put together my SMX presentation I figured it was worth sharing that information on the blog as well. This post will discuss examples of how Google has dialed up their brand bias over time & points to where Google may be headed in the future.

Note that I don't have anything against them promoting brands, I just think it is dishonest to claim they are not.

Against All Odds

When analyzing Google's big-brand bias the question is not "do some small sites manage to succeed against all odds" but…

• What are the trends?
• What are the biases?

Quotable Quotes

Eric Schmidt once stated that "Brands are the solution, not the problem. Brands are how you sort out the cesspool. Brand affinity is clearly hard wired."

We have a fear of the unknown. Thus that which we have already experienced is seen as less risky than something new & different. This is a big part of why & how cumulative advantage works - it lowers perceived risk.

A significant portion of brand-related searches are driven by offline advertising. When a story becomes popular in the news people look online to learn more. The same sort of impact can be seen with ads - from infomercials to Superbowl ads. Geico alone spends nearly a billion Dollars per year on advertising, & Warren Buffet mentioned that 3/4 of their quotes come from the internet.

Some of the most profitable business models are built off of questionable means.

Many big brands are owned by conglomerates with many horses in the race. When one gets caught doing something illegal they close it down or sell off the assets & move to promote their parallel projects more aggressively.

If things aligned with brands become relevancy signals then to some degree those measure longevity & size of a company (and their ad budget) rather than the quality of their offering.

Even before the Panda update Google's Amit Singhal suggested the problem with this:

Companies with a high page rank are in a strong position to move into new markets. By “pointing” to this new information from their existing sites they can pass on some of their existing search engine aura, guaranteeing them more prominence.
...
Google’s Mr Singhal calls this the problem of “brand recognition”: where companies whose standing is based on their success in one area use this to “venture out into another class of information which they may not be as rich at”. Google uses human raters to assess the quality of individual sites in order to counter this effect, he adds.

Since Panda Overstock has moved into offering ebooks & insurance quotes while companies like Barnes & Noble run affiliate listings for rugs.

As an example of the above trend gone astray, my wonderful wife recently purchased me a new computer. I was trying to figure out how to move over some user databases (like our Rank Checker & Advanced Web Ranking) and in the search results were pages like this one:

The problems with the above are:

• actual legitimate reviews get pushed down by such filler
• the business model behind doing such actual reviews gets eroded by the automated syndicated reviews
• outside of branding & navigation the content is fully syndicated
• that particular page is referencing the 2005 version of the software, so the listed price is wrong & the feature set has changed a lot in the last 7 years

Such scrape-n-mash content strategies by large brands are not uncommon. Sites like Answers.com can quickly add a coupons section, sites like FindTheBest can create 10s of millions of automated cross-referencing pages that load a massive keyword net of related keywords below the fold, news sites can create auto-generated subdomains of scraped content, etc.

Eric Schmidt highlighted FindTheBest publicly as an example of a successful vertical search play. That site was launched by an ex-Googler, but if I did the same thing you can be certain that the only way Google would highlight it publicly would be as a "type of spam."

The issue with broadly measuring user experience is that I am still going to visit Yahoo! Sports repeatedly even if my experience on Yahoo! Downloads is pretty crappy. A site which is a market leader in one niche can take those signals to launch a "me too" service in other parallel markets & quickly dominate the market.

Potential Brand Signals

When attempting to debunk the concept of "brand bias" some people claim that it would be ridiculous for Google to have a list of brands that get an across-the-board boost. Of course that debunking is debunking a straw man that was never stated publicly (outside of the irrelevant debunking).

However, some of Google's old rater documents *did* have certain sites whitelisted & Google's Scott Huffman once wrote the following:

At a [search] quality level, we have something similar. On a continuous basis in every one of our data centers, a large set of queries are being run in the background, and we’re looking at the results, looking up our evaluations of them and making sure that all of our quality metrics are within tolerance.

These are queries that we have used as ongoing tests, sort of a sample of queries that we have scored results for; our evaluators have given scores to them. So we’re constantly running these across dozens of locales. Both broad query sets and navigational query sets, like “San Francisco bike shop” to the more mundane, like: Here’s every U.S. state and they have a home page and we better get that home page in the top results, and if we don’t … then literally somebody’s pager goes off.

(Outside of some fraternal Google properties) the algorithm isn't hardcoded to rank sites x & y at #1, but if some sites don't rank for certain queries it does cause an alert to be sent out.

Google has a wide host of quality-based metrics they could look at and analyze when determining if something gets a brand boost, gets ignored, or gets hit by an algorithm like Panda.

A while back we wrote a post on potential brand signals, but a short list of examples would be:

• Classical relevancy signals
  • domain name
  • website age
  • anchor text
  • link diversity
  • keyword co-citation
  • inclusion in trusted databases
• Search behavior
  • keyword search volume trends
  • CTR of users on search results (including how users respond to changes in rank)
  • URL-based searches & other branded searches (the most popular keyword on Google is Facebook)
  • back button clicks (did the user find what they were looking for? or did they look somewhere else?)
  • repeat visitors (if someone repeatedly visits a website that is generally a pretty strong indication they had a positive user experience)
  • search query chains (Google suggested this was a big driver in the Vince update)
• Passive user monitoring
  • search has become the primary mode of navigation online
  • Google has long offered a search toolbar & paid to have it installed in new computers
  • Google paid Mozilla about a billion Dollars for default search placement in Firefox
  • Google owns Chrome & Android
  • Google offers the most widely used analytics program
  • Google can also use AdSense ads and YouTube data to track users
  • Google was recently caught in privacy-related snafus with tracking Safari & Internet Explorer users

Brand-focused Editorial

In 2008 Rhea Drysdale created the following image, which highlighted how the same activity could be viewed as a legitimate marketing strategy or spam based on nothing other than who was doing it.

The Vince Update

In 2009 Google rolled some of their brand bias directly into the relevancy algorithms. A bunch of branded sites all jumped up in rankings out of nowhere for core industry keywords.

Around that time Microsoft offered a search funnels tool, which showed what people searched for after searching for a particular keyword.

The above screenshots (from Rankpulse and the Microsoft Search Funnels) are both from now defunct tools, but Yahoo! has since launched a tool called Yahoo! Clues which shows similar relationships.

Amit Singhal told the Telegraph that Google is "the biggest kingmaker on this Earth."

A Google engineer admitted that the Vince update was largely driven by search funnels. Google then rolled out a search results interface change which promoted brands & stores directly in the search results.

If you search for "fishing gear" and then click their Bass Shop refinement link in the search results, you are thus directly creating that search funnels relevancy "signal." Even if you don't click on that link the exposure to the term may make you remember it and search for it later.

Paid Links

Are paid links evil?

Once again, it depends on who is doing it.

When the largest flower websites were caught buying massive quantities of links, a Google spokesperson told the New York Times: "None of the links … had a significant impact on our rankings, due to automated systems we have in place to assess the relevance of links."

When some small bloggers were selling paid links to K-Mart as part of a "sponsored conversations" outreach, Matt Cutts equated the practice to selling bogus solutions to brain cancer & stated: "Those blogs are not trusted in Google's algorithms any more."

Google also started sending webmasters automated messages for bad links pointing at their sites:

Dear site owner or webmaster of domain.com, We've detected that some of your site's pages may be using techniques that are outside Google's Webmaster Guidelines.
...
We encourage you to make changes to your site so that it meets our quality guidelines. Once you've made these changes, please submit your site for reconsideration in Google's search results.

So if you run a big site & they automatically detect paid links they generally just ignore those links and leave your site alone. If you are a small site & they automatically detect paid links they may decide to automatically penalize your site.

Same offense, entirely different outcome.

Cloaking

Is cloaking evil?

Once again, it depends on who is doing it.

I have a Vistaprint Visa card (so I could get a credit card with our dog's picture on it) and one of the pages that was ranking for Vistaprint Visa was the Singapore Groupon website.

The page forces a pop up and you can't do anything on that page (view the content, scroll around the site, etc.) other than filling in the lead generation form or logging into an existing account. I would never try that because I know I would get smoked for it. ;)

Groupon has also ran AdWords accounts where the only option was to fill in the lead generation form or click into the TOS which are in another language!

After the first iteration of the Google Panda update Google allowed users to vote to block websites. Experts Exchange was hated among some programmers in part because they used scroll cloaking. That in turn got their site hit by the second Panda update.

Google then later rolled out a new ad unit where you pay for viewing content by taking a Google survey & some YouTube videos use preroll ads.

Doorway Pages

Are doorway pages evil?

Once again, it depends on who is doing it.

After the Panda update Ikea's thin content-free pages started ranking page 1 for some pretty competitive keywords.

Huffington Post later wrapped 3rd party Tweets in their site's template & ranked those in Google.

Smaller webmasters who ran network of sites in some cases got hit with "doorway page" penalties for owning networks of sites registered in Google Webmaster Tools, even if each site was a full fledged ecommerce website.

Content Farming

Is content farming evil?

Once again, it depends on who is doing it (and where it is hosted).

Long before the Panda update I highlighted some of the informationless videos Demand Media was uploading to Youtube.

In spite of Google's Panda hitting eHow, Google still decided to pre-pay Demand Media to keep uploading YouTube videos.

Another thing that is interesting about the content farms and the alleged need for the Panda algorithm was that in spite of flagrant editorial violations by both eHow and Mahalo, Google didn't smoke them until it could be done "algorithmically."

On the flip side of the above, in some cases Google has chose to keep smaller webmasters penalized because content that was at one point on their site months in the past!

Google+

When Google+ launched I highlighted how it was acting as a scraper site by outranking original publisher content. About a half-year later some tech blogger noticed that issue & caused a big stink over it. A Google engineer then suggested that it was childish to place any of the blame on Google. Shortly after that Google integrated Google+ in the search results far more aggressively.

A couple weeks after that aggressive promotional integration Amit Singal stated: "The overall takeaway that I have in my mind is that people are judging a product and an overall direction that we have in the first two weeks of a launch, where we are producing a product for the long term."

The problem with build preferential rankings first & increase quality later is that is the exact opposite of what Google is asking publishers to do with algorithms like Panda. Worse yet, Google not only does this integration when you are logged in, but also shows it on obscure longtail advanced queries when you are not logged in.

Affiliates

When Google's ad ecosystem was young they loved affiliates, but that changed over time.

In Google's remote rater documents they suggested that hotel affiliate sites be marked as spam, even if they are helpful.

On Google's reconsideration request form they also stated: "In general, sites that directly profit from traffic (e.g. search engine optimizers, affiliate programs, etc.) may need to provide more evidence of good faith before a site will be reconsidered."

And while Google has biased their editorial philosophies away from affiliates, some of the trusted brands like Barnes & Noble added affiliate listings to their websites, selling things like rugs.

The Business Cycle

Most businesses tend to grow in a cycle...

• Bootstrap / self-funded
• Raise funds / take out a loan
• Build exposure
• Monetize attention
• Re-invest in increased quality
• 
• Build a brand
• Build further exposure
• Monetize more attention
• Re-invest in increased quality

The broken piggy bank in the above cycle highlights the break that exists in the process to building a big brand. It is quite hard to have any level of certainty in the search ecosystem with an algorithm like Panda. Without that level of certainty companies must build from low cost structures, but that very constraint makes them more likely to get hit by an algorithm or search engineer.

Pricing Risk

Being an entrepreneur is all about taking smart calculated bets & managing risk. However as search engines become closed off portals that compete with (& exclude) publishers, there are so many unknowns that estimating risk is exceptionally challenging.

• When the New York Times bought About.com Google was one of the leading competing bidders. But after Panda, About.com's profit declined by 2/3.
• TeachStreet was a fast growing start up that was shut down due to Panda.
• CustomMade is a Google-funded start up launched by an SEO who purchased an old website & created a vertical directory out of it (just like TeachStreet was trying to do, but in a different vertical). Googler's helped with the project & the article highlighting that shared this quote: "Having Google as an investor gives you a branding piece that you can't ignore." - Christopher Ahlberg.

Penalties: How Hard Were They Hit?

• Years ago when BMW or Wordpress.org got caught spamming aggressively they were back in good graces in a mater of days.
• About the only times well known (non-affiliate) sites have been penalized for a significant duration was when JC Penney & Overstock.com were hit. But that happened around the time of the Panda fiasco & Google had incentive to show who was boss. When the flower sites were outed for massive link buying that was ignored because Google had already rolled out Panda & reasserted the perception of their brand.
• When Google was caught buying links (again) to promote Google's Chrome browser & that story spread widely throughout the mainstream press, Googlers lied & claimed there was only 1 paid link in 1 single page & penalized a single page of their site. Small website owners that have been caught in similar link buying (or selling) campaigns have been hit much harder. Remember the above story about the bloggers blogging about K-Mart? So far this year Google has sent webmasters over 700,000 messages in Google Webmaster Central.

1 Strike - You're Out

In 2009 Google banned over 30,000 affiliates from the AdWords auction. In some cases the problem was not with a current ad (or even a landing page the advertiser controlled), but rather ads that ran years ago promoting 3rd party products. In some cases Google changed their AdWords TOS after the fact in an ex post facto style. Google won't allow some of these advertisers to advertise unless they fix the landing page, but if they don't control the landing page they can't ever fix the problem. Making things worse, to this day Google still suggests affiliates do direct linking. But if the company they promote gets bought out by someone too aggressive then that affiliate could be waiting for a lifetime ban through no fault of their own.

A popular programmer who has been an AdSense publisher for 8 years had their AdSense account arbitrarily suspended without warning. After an ex-Googler expressed outrage over the issue he was able to get his AdSense account reactivated. A publisher without those friendships would have been done.

In Australia a small travel site had a similar issue with AdSense. The only way they were able to get a reconsideration was to lodge a formal complaint with regulators. If that is how Google treats their business partners, it colors how they view non-business partners who monetize traffic without giving Google a taste of the revenues.

Why Does Google Lean Into Brand?

• Minimize legal risks: if they hit small businesses almost nobody will see/notice/care, but big businesses are flush with cash and political connections. When Google hits big businesses they create organizations & movements like Fair Search & Search Neutrality.
• Minimize duplication: some small businesses & affiliates simply repeat offers that exist on larger merchant sites. That said, many big businesses buy out a 2nd, 3rd, 4th, or even 5th site in a vertical to have multiple placements in the search results.
• Better user experience: the theory is that the larger sites have more data and capital to improve user experience, but they don't always do it.
• Business partnerships: if Google wants to strike up closed door business partnerships with big business then some of those negotiations will have specific terms attached to them. It costs Google nothing to give away part of the organic results as part of some custom deals. If Google wants to sell TV ads & run a media streaming device they need to play well with brands.
• CPA-based product ads: on some searches Google provides CPA-based product ads above the search results. It makes sense for Google to promote those who are buying their ads to get the best relationships possible.
• Fewer people tasting the revenues: the fewer organizations an ecosystem needs to support the more of the profits from that ecosystem that can be kept by the manager.
• More complete ad cycle: if Google caters to direct response advertisers they get to monetize the demand fulfillment of demand, however that is only a small slice of the complete ad cycle. If Google caters to brands they get to monetize (directly or indirectly) every piece of the ad cycle. For example, buying display ads helps build brand searches which helps create brand signals. In such a way, improved rankings in the organic results subsidize ad buying.
  • Attention
  • Interest
  • Desire
  • Action
  • Satisfaction
• Brands buying their equity: Google has create exceptionally large ad units & has convinced many brands to buy their own pre-existing brand equity.
  

Lack of Diversity

The big issue with brand bias is that a lot of the same *types* of companies rank with roughly similar consumer experiences. If there is a mix of large and small businesses that rank then many of those small businesses will be able to differentiate their offering by adding services to their products, doing in-depth reviews, and so on.

Sure Zappos is a big company known for customer service, but how different is the consumer-facing experience if I click on Target.com or Walmart.com? Sure the text on the page may be slightly different, but is there any real difference beyond aesthetic? Further, a lot of the business models built around strong in-depth editorial reviews & comparisons are eroded by the current algorithms. If the consumer reviews are not good enough, then tough luck!

Do Brands Always Provide a Better User Experience?

Some larger retailers track people in ways that are creepy:

For decades, Target has collected vast amounts of data on every person who regularly walks into one of its stores. Whenever possible, Target assigns each shopper a unique code — known internally as the Guest ID number — that keeps tabs on everything they buy. "If you use a credit card or a coupon, or fill out a survey, or mail in a refund, or call the customer help line, or open an e-mail we've sent you or visit our Web site, we'll record it and link it to your Guest ID," Pole said. "We want to know everything we can."

Many big media companies provided watered down versions of their content online because they don't want to cannibalize their offline channels. Likewise some large stores may consider their website an afterthought. When I wanted to order my wife a specific shoe directly from the brand they didn't have customer support open for extended hours during the holidays and their shopping cart kept kicking an error. Since they *are* the brand, that brand strength allows them to get away with other issues that need fixed.

Some of those same sites carry huge AdSense ad blocks on the category pages & have funky technical issues which act like doorway pages & force users who are using any browser to go through their homepage if they land on a deep page.

Missing the Target indeed.

That above "screw you" redirect error has been going on literally for weeks now, with Target's webmaster asleep at the wheel. Perhaps they want you to navigate their site by internal search so they can track every character you type.

Riding The Waves

With SEO many aggressive techniques work for a period of time & then suddenly stop working. Every so often there are major changes like the Florida update & the Panda update, but in between these there are other smaller algorithmic updates that aim to fill in the holes until a big change comes about.

No matter what Google promotes, they will always have some gaps & relevancy issues. Some businesses that "ignore the algorithms and focus on the user" are likely to run on thinner margins than those who understand where they algorithms are headed. Those thin margins can quickly turn negative if either Google enters your niche or top competitors keep reinvesting in growth to buy more marketshare.

Profit Potential

Given the above pattern - where trends spread until they get hit hard - those who quickly figure out where the algorithms are going & where there are opportunities have plenty of time to monetize their efforts. Whereas if you have to wait until things are widely spread on SEO blogs as common "tricks of the trade" or wait until a Google engineer explicitly confirms something then you are likely only going to be adopting techniques and strategies after most of the profit potential is sucked out of them, just before the goal posts move yet again.

People who cloned some of the most profitable eHow articles years ago had plenty of time to profit before the content farm business model got hit. Those who waited until Demand Media spelled their business model out in a Wired article had about 1.5 years until the hammer. Those who waited until the content farm controversy started creating a public relations issue to clone the model may have only had a couple months of enhanced revenues before their site got hit & was worse off than before they chased the algorithm late in the game.

Ride The Brand

If Google does over-represent established branded websites in their algorithms then in many cases it will be far easier to rank a Facebook notes page or a YouTube video than to try to rank a new site from scratch. There are a ton of web 2.0 sites driven by user generated content.

In addition to those sorts of sites, also consider participating in industry websites in your niche & buying presell pages on sites that rank especially well.

Collecting (& Abusing) User Data

Google has been repeatedly branded as being a bit creepy for their interest in user tracking.

Their latest privacy policy change was rolled out in spite of EU warnings that it might not comply with the law.

Collecting that data & using it for ad targeting can have profound personal implications (think of serving a girl with anorexia ads about losing weight everywhere she goes online, simply because she clicks the ad, in such a case Google reinforces a warped worldview). Then when the person needs counseling Google can recommend a service provider there as well. ;)

Trust in Google's ability to do the right thing would be greater if they were not caught in that drug sting selling ads to fake Mexican pharmacies selling illicit products, a practice they were involved in before going public.

They also take aggregate collected data and sell it off to banksters.

Google as Content Host (& Merchant)

Throughout the history of the web there will be many cycles between open and closed ecosystems. Currently we are cycling toward closed silos (Apple, Amazon, Google, Facebook). As these silos become more closed off they will end up leaving gaps that create new opportunities.

Google has been pushing aggressively for years to host content & crowd out the organic search results.

• As publishers mark up their content Google can aggregate & displace publishers higher up the value chain. Google has done research on measuring non-click user satisfaction (no need to bother leaving Google & visiting the publisher site). If your business model was one of the examples on that list I would bet on Google entering your niche aggressively sooner rather than later.
• When many other content farms were hit YouTube gained traffic. YouTube is investing in original content & partnering with NBC for Olympics coverage and Disney for kid shows.
• Google+ is inserted directly in the organic search results & often outranks the original content source.
• Google Books has seen aggressive integration in the search results, even before the legal issues have been resolved.
• Google Places has long pushed down the organic search results & in some cases (like with hotels) Google also adds price ads to these listings.
• Google Flights has pushed down the organic search results & Google is also powering flight booking options on some smaller regional carriers.

While on one front Google keeps making it easier for brands to compete against non-brands, Google also keeps clawing back a bigger slice of that branded traffic through larger AdWords ad units & integration of listings from services like Google+, which can in some cases outrank the actual brand.

Google has multiple platforms (Android Marketplace, Chrome Marketplace, Enterprise Marketplace) competing against iTunes. Google recently decided to merge some of their offerings into Google Play. In addition to games, music & books, Play will soon include audiobooks, magazines & other content formats.

Google also wants to compete against Amazon.com to launch an Amazon Prime-like delivery service.

Having a brand & following will still be important for allowing premium rates, fatter margins, building non-search distribution (which can be used to influence the "relevancy" signals), and to help overturn manual editorial interventions. But algorithmically brand emphasis will peak in the next year or two as Google comes to appreciate that they have excessively consolidated some markets and made it too hard for themselves to break into those markets. (Recall how Google came up with their QDF algorithm only *after* Google Finance wasn't able to rank). At that point in time Google will push their own verticals more aggressively & launch some aggressive public relations campaigns about helping small businesses succeed online.

Once Google is the merchant of record, almost everyone is just an affiliate, especially in digital marketplaces with digital delivery.

Google's Take on Search Plus Your World

A few weeks ago Google announced the launch of Search Plus Your World, which deeply integrates social sites (especially Google+) into the Google search experience to make it more personalized.

While Google claimed that the socialization was rather broad-based, the lack of inclusion of Facebook & Twitter along with the excessive promotion of Google+ raised eyebrows. While the launch was claimed to be social for personalizing results, the Google+ promotions appeared on queries where they were clearly not the most relevant result even when users are not logged into a Google account.

Google+ Over-promotion

A couple weeks ago when Google announced Google Search Plus Your World competitors collectively complained about Google over-promoting their own affiliated websites.

Twitter was perhaps the loudest complainer, highlighting how Google basically eats all the above-the-fold real estate with self promotion on this @WWE search.

It is no surprise that folks like Ben Edelman, Scott Cleland & Fair Search chimed in with complaints, as this is just a continuation of Google's path. But the complaints came from a far wider cast of characters on this move: the mainstream press like CNN, free market evangalists like the Economist, Google worshipers indoctrinated in their culture who wrote a book on Google & even ex-Googlers now call into question Google's transparently self serving nature:

I think Google as an organization has moved on; they’re focussed now on market position, not making the world better. Which makes me sad.

Google is too powerful, too arrogant, too entrenched to be worth our love. Let them defend themselves, I'd rather devote my emotional energy to the upstarts and startups. They deserve our passion.

The FTC's Google antitrust probe is to expand to include a review of Google+ integration in the search results.

Facebook & Twitter launched a don't be evil plugin named Focus On The User, which replaces Google+ promotion with promotion of profiles from Facebook& Twitter.

For the top tier broad social networks framing the idea of integrating promotion of their networks directly in the search results is a natural & desirable conclusion, but is that just a convenient answer to the wrong question?

• Whether Google ranks any particular organic result above the corresponding Bing ranking in Google's now below-the-fold organic results is a bit irrelevant when the above the fold results are almost entirely Google.com. But is the core problem that we are under-representing social media in the search results? According to Compete.com, Facebook & YouTube combine to capture about 16% of all downstream Google clicks. Do we really need to increase that number until the web has a total of 5 websites on it? What benefit do we get out of a web that is just a couple big walled gardens?
• If Facebook is already getting something like 20% of US pageviews & users are still looking for information elsewhere, doesn't that indicate that they probably desire something else? Absolutely Facebook should rank for Facebook navigational queries, but given all their notes spam, I don't like seeing them in the search results much more than seeing a site like eHow.
• The he said / she said data deals are also highly irrelevant. What is really needed is further context. Before Google inserted Google+ in their search results the Google+ social network was far less successful than MySpace (which recently sold for only $35 million). If social media is added as an annotation to other 3rd party listings then I think that has the opportunity to add valuable context, but where a thin "me too" styled social media post replaces the publisher content it lowers the utility of the search results & wastes searcher's time. Further, when those social media results are little more than human-powered content scrapers it also destroys the business models of legitimate online publishers.

Over-promotion vs "Search Spam"

At any point Google can promote one of their new verticals in a prominent location in the search results & if they are anywhere near as good as the market leader eventually they can beat them out of nothing more than the combination of superior search placement, monopoly search marketshare, account bundling & user laziness. What's more, they can make paid products free and/or partner with competitors 2 through x in an attempt to destroy the business model of anyone they couldn't acquire (talk to Groupon).

Amit Singhal is obviously a brilliant guy, but I thought some of the answers he gave during a recent interview by Danny Sullivan were quite evasive & perhaps a bit inauthentic. In particular, ...

• "The overall takeaway that I have in my mind is that people are judging a product and an overall direction that we have in the first two weeks of a launch, where we are producing a product for the long term." If the product wasn't ready for prime time you were not required to mix it directly into the organic search results right off the bat. It could have been placed at the bottom of the search results, like the "Ask on Google" links were. Bing has been working on social search for 18 months & describes their moves as "being very conservative."
• "The user feedback we have been getting has been almost the other side of the reaction we’ve seen in the blogosphere." Of course publishers who see their content getting scraped & see the scraped copy outranking the original have a financial incentive to care about a free & automated scraper site displacing their work. They don't get those pageviews, they don't get that referrer data, and they don't get those ad impressions. Google's PR team is anything but impressed when another company dares do that to Google.
• "The users who have seen this in the wild are liking it, and our initial data analysis is showing the same." Much like the Google Webmaster Tools shows that pages with a +1 in the search results get a higher CTR, this Google+ social stuff also suffers from the same type of sampling bias & giving the listings a larger and more graphical stand out further help them pull in much more clicks. Any form of visual highlighting & listing differentiation can lift CTR. I might be likely to click on some of my own results more, but when I do so you might just be grabbing a slice of navigational searches I was going to do anyway where I was looking for something else I posted on Google+ or my Google+ account or the account of a friend & so on. Further, aggregate data hides many data points that are counter to the general trend. I have seen instances of branded searches where the #1 organic site was getting a CTR above 70% (it even had organic sitelinks, further indicating it was a navigational search) and for such a search in some cases there were 2 Adwords ads above the organic results & then the Google+ page for a brand outranked the associated brand in the SERPs for those who followed it! That is a terrible user experience, particularly since the + page hasn't even had any activity for months.
• "Every time a real user is getting those results, they really are delighted. Given how personal this product is, you can only judge it based on personal experiences or by aggregate numbers you can observe through click-through." First, publishers are not fake users. Secondly, as mentioned above, there is a sampling bias & the + listings stand out with larger & more graphical listings. If they didn't get a higher CTR that would mean they were *really* irrelevant.
• "out of the gate, whereas we had limited users to train this system with, I’m actually very happy with the outcome of the personal results." They could have been placed at the bottom of the search results or off to the side or some such until there was greater confidence in the training set.
• "People are coming to a conclusion about the product today, within the first two weeks, and they’re not fully seeing the potential where we can build this product around real identities and real relationships." If a publisher promotes a site to the top of the search results & then says something like 'we will improve quality later' they are branded as spammers. In the past Google has justified penalizing a site based on its old content that no longer exists on the site. Investing in depth, quality & volume is a cycle. If others get prohibited from evolving through the cycles due to algorithms like Panda then it becomes quite hard to compete as a new start up when Google can just insert whatever it wants right near the top & then work on quality after the fact.
• "We don’t think of this as a promotional unit now. This is a place that you would find people with real identities who would be interesting for your queries." If this is the case then why does it only promote Google+?
• "We’re very open to incorporating information from other services, but that needs to be done on terms that wouldn’t change in a short period of time and make our products vanish." The problem is, if a company builds a reputation as a secretive one that clones the work of its partners & customers then people don't want to do open-ended transparent relationships. Naive folks might need to see the blood and tears 3 or 4 times to pick up on the trend, but even the slowest of the slow notice it after a dozen such moves.
• "I’m just very wary of building a product where the terms can be changed." Considering Google's lack of transparency & self-promotional bias on the social networking front, would you be fully transparent and open with Google? If so, then aren't the search algorithms complex enough that it would make sense to make those transparent as well? How can you ask other social networks to increase transparency at the same time Google is locking down their search data on claims of protecting user privacy?
• "It’s not just about content. It’s about identity, and when you start talking about these things and what it takes to build this, the data needed is much more than we can publicly crawl." This is where being trustworthy is so crucial. Past interactions with Yelp, TripAdvisor & Groupon likely make future potential partners more risk adverse & cautious. Outrageous "accidents" like those that happened with Mocality & Open Street Map from playing fast and loose further erode credibility. And even when Google hosts the media & has full access to user data they still rank inferior stuff sometimes (like the recent Santorum YouTube cartoon fiasco), even on widely searched core/head keywords.

The big issue is that if people feel the game is rigged they won't have much incentive to share on Google+. I largely only share stuff that is irrelevant to tangentially relevant to our business interests & won't share stuff that is directly relevant, because I don't want to be forced to compete against an inferior version of my own work when the deck is stacked so the inferior version wins simply because it is hosted on Google.

As we move into the information age a lot of physical stores are shutting down. Borders went bust last year. Sears announced the closure of many stores. And many of the people shopping in the physical stores that remain are using cell phones for price comparisons. Given Google's mobile OS share this is another area where they can build trust or burn it. A friend today mentioned how their online prices on Google Product search almost always show a lower price near the header than the lowest price available in the list - sometimes by a substantial margin.

Identity vs Anonymous Contractors

In the past we have mentioned that transparency is often a self-serving & hypocritical policy by those atop power systems who want to limit the power of those whom they aim to control.

When Google was caught promoting illegal drug ads there was no individual who took the blame for it. When the Mocality scraping & the Open Street Map vandalism issues happened, all that we were told was that Google "was mortified" and it was "a contractor." If people who did hit jobs could just place all the blame on "the contractor" then the world would be a pretty crappy place!

Eric Schmidt warned that "If you have something that you don't want anyone to know, maybe you shouldn't be doing it in the first place." That sage advice came from the same Eric Schmidt that blackballed cNet for positing personal information about him. Around the same time Eric offered the above quote, Google was engaged in secret & illegal backdoor deals with direct competitors to harm their own employees.

What happened to Google recruiters who dared to go against the illegal pact? They were fired on the hour:

"Can you get this stopped and let me know why this is happening?" Schmidt wrote.

Google's staffing director responded that the employee who contacted the Apple engineer "will be terminated within the hour."

When Google+ launched they demanded that you use your real name or don't use the product. They later claimed that you can use a nickname on your account as well, but there is a difference between a nickname and pseudonyms.

What is so outrageous about the claims for this need for real identities is that past studies have shown that pseudonymous comments are best & Bruce Schneier highlighted how we lose our individuality if we are under an ever-watchful eye:

Cardinal Richelieu understood the value of surveillance when he famously said, "If one would give me six lines written by the hand of the most honest man, I would find something in them to have him hanged." Watch someone long enough, and you'll find something to arrest -- or just blackmail -- with. Privacy is important because without it, surveillance information will be abused: to peep, to sell to marketers and to spy on political enemies -- whoever they happen to be at the time.

Privacy protects us from abuses by those in power, even if we're doing nothing wrong at the time of surveillance.

In many markets ads and content are blended in a way that is hard to distingush between them. Whenever Google wants to enter they can demand greater transparency to participate (and then use the standard formatted data from that transparency to create a meta-competitor in the market.)

Increasingly Google is placing more of their search data & their webmaster-related functions behind a registration wall. If you are rich & powerful they will sell you the data. If you are the wrong type of webmaster that aggregate data can be used in *exceptionally* personal ways.

User Privacy

Ahead of Google updating their privacy policy Google has directed a large portion of their ad budget toward ads about how they protect users online.

What better way to ensure user privacy than to allow them to register their accounts under psydonyms? The real name policy on Google+ was part of what made Google want to stop providing referrer data for logged in users who search on Google. This has had a knock on effect where other social sites are framing everything, requiring registration to read more of public user generated content & sending outbound traffic through redirects.

Google's new privacy policy allows them to blend your user data from one service into refining the experience (and ads) on another:

If you’re signed into Google, we can do things like suggest search queries – or tailor your search results – based on the interests you’ve expressed in Google+, Gmail, and YouTube. We’ll better understand which version of Pink or Jaguar you’re searching for and get you those results faster.

Google & Facebook's war (against) user privacy is catching media and governmental attention. Microsoft highlighted some of Google's issues in their "putting people first" ad campaign & the blowback has caused Google not only to publish PR-spin "get the facts" styled blog posts, but to launch yet another ad campaign.

EU regulators have asked Google to pause their privacy policy changes.

Bogus Testimonials & Social Payola

Is social media a cleaner signal than links? If search engines put the same weight on social media that they put on links it would get spammed to bits. It won't be long until a firm like Ad.ly offers sponsored Google+ posts.

Some have suggested that you won't be able to buy Google+ followers however Google already includes user pictures on AdWords ads (even when they desire not to be & even when they didn't endorse the product that Google suggests they endorsed). In due time I expect Google will indeed sell followers & other user interactions as ad units (just like Twitter & Facebook do).

Further, celebrities sell Tweets to advertisers. When they are hot their rates go up:

When Ad.ly introduced self-destructing Charlie Sheen to Twitter, he was paid about $50,000 per tweet. It was worth it. Sheen’s tweet for Internships.com generated 95,333 clicks in the first hour and 450,000 clicks in 48 hours, created a worldwide trending topic out of #tigerbloodintern, attracted 82,148 internship applications from 181 countries, and added 1 million additional visits to Internships.com.

Search engines might consider these to be clean signals if those same search engines were not busy buying the manipulation of said "relevancy" signals.

Attention is purchased to create demand. It isn't comfortable to put it this way, but we are trained to obey authority & to like what others like:

The average Facebook user has 130 friends, which equates with four degrees of separation to thousands of people, Mr. Fischer said. Metrics like that led him to believe that if Facebook could figure out a way to capitalize on "social endorsements," it would be like creating a word-of-mouth campaign that could reach millions of people simultaneously. Since the campaigns would come from a friend, they would theoretically be taken more seriously than, say, a TV commercial, he said.

On an individual basis reviews and ratings get faked everywhere. Even stodgy old slow-moving institutions like colleges game their ranking systems.

There recently was a question raised about how Google's rating systems skewed high on the underlying data. Surely Overstock (the same Overstock Google penalized earlier this year) wouldn't promote Google's trusted stores aggressively on their own site if it made their business appear worse than it actually is, thus a positive bias must be baked in to the system.

Entire categories of demand are created by those tied in with power cost shifting to create bubbles. The federal reserve helped spark a real estate bubble with low interest rates. FBI warnings of mortgage fraud were ignored. Consumers were constantly fed propaganda about "real estate only goes up." Then when that bubble popped, the US government bailed out those who caused it & burned trillions of Dollars propping up home prices. The government even bailed out a company that is now shorting the housing market (when that company was about to get bailed out the secretary of treasury leaked that material non-public information to some of his criminal investor buddies).

Does all the above sound circular, conflicting, corrupt & confusing? It should, because that is how power works & comes off as seeming semi-legitimate when acting in illigitimate ways. The perception of reality is warped to create profitable opportunties that are monetized on the way up and the way down.

Millions of kids take drugs that address the symptoms of being a child full of energy, imagination & entusiasm. In some cases they may need them, but in most cases they probably don't. The solution with the highest economic return gets the largest ad budget, even if it only treats symptoms.

Web Scrape Plus+ (Now With More Scraping)

When the +1 button & Google+ launched, Google highlighted how they would use the + button usage as a "relevancy" signal. Google recently started inserting + pages directly into the search results for brands & right from the very start they were using it as a scraper website that would outrank the original content source.

Google used the buy in from their promised relevancy signal to create a badge-based incentivized system which acts as a glorified PageRank funnel to further juice the rankings of these new pages on a domain name that already had a PageRank 10.

I recently read a blog post about how anyone could do the above & the opportunity is open to everyone. But the truth is, I can't state that something will become a relevancy signal that manipulates the search results in order to get buy in. Or, if I did something which actually had the same net effect, Google would likely chop my legs off for promoting a link scheme.

Recently the topic of Google+ as a scraper site came up yet again via Read Write Web & on Hacker News a Googler stated that it was "childish" to place any of the blame on Google!!!!!!

Google determines how much information is shown near each listing & can create "relevancy" signals in ways that things tied to Google get over-represented (look at the +1 count here). When they do that & it destroys other business models *of course* Google deserves 100% of the blame.

Thin Content & Scraper Sites

Remember the whole justification for Panda was that thin content was a poor user experience?

In spite of sites like eHow getting hit, Google is still pre-paying them to upload content to Youtube.

Now that the (non-Google hosted) thin content has been disappeared (and the % of downstream traffic from Google to Youtube has more then doubled in the past year) it is time for Google to take another slice of the search traffic stream with Search Plus Your World:

The Google vs Facebook locked down walled garden contest will retard innovation. As the corporate internet silos grow larger the independent web withers. Them going after each other may leave room for Twitter, but it doesn't leave lots of room is left for others, as the economics of publishing have to work or the publishers die.

Start ups that were on a successful trajectory were killed by Panda:

The startup had been on a roll up until last February when Google altered its ranking algorithm with the release of “Panda.” The changes decimated TeachStreet’s traffic, and the company never quite recovered.

“We lost a lot of our traffic, and overnight we started talking to partners for biz dev, not for acquisition,” he said. However, many of the potential partners wanted to know about an outright acquisition.

About.com was also smoked by Google:

The biggest worry, though, is that the decline of About.com itself may be irreversible. Fewer people are clicking on About ads placed by Google and the site’s own display ads have dropped in value.

The company has attributed this decline in value to Google’s decision last year to downgrade About pages in its search results. With more than 80% of traffic coming from search, the Google denigration was indeed a blow but About’s problems may be rooted in something deeper.

Keep in mind that the reason these websites were hit was that they were claimed to be thin & thus a poor user experience. When the NYT bought About.com one of the top competing bidders was Google!

Now that the "thin content" has been demoted in the search results Google can integrate deep content silos from Google+, like this one:

That is an 8-word Google+ post about how short another blog post is. I like Todd & do like to read his writings, but here Google is clearly favoring the same sort of content they would have torched if it was done on an independent webmaster's website.

How Google has raters view other websites that redirect traffic is based upon those sites having a substantial value add. Clearly in the above example there was nothing added to the interaction beyond sharing a bookmark with a punchy tagline.

If Google wants to use the + notation to pull up that other referenced page then perhaps that can make sense, but to list an 8-word Google+ page in the search results nearly a year after the Panda algorithm is outrageous. This sort of casual mention integration in the search results occurs on expensive keywords as well. Not only do they list your own Google+ posts...

...but they also list them from anyone you follow...

In addition to information pollution, the other big issue here is time. Google wants to make forms more standardized to make filling them out faster & they give regular sermons on the importance of fast search results. Yet when I do a navigational search, Google delivers two AdWords ads, a huge Google+ promotion, and then the navigational search result barely above the fold.*

*Since I thought the above was obnoxious, I renamed our Google+ company page to S_E_O Book to help Google fix their relevancy problems.

Can anyone explain how Google's speed bias is aligned with putting plus junk right at the top, even on brand searches? Yahoo! has been pretty aggressive with putting shopping ads in the search results, but their implementation is still a better user experience than what Google did above.

And Bing offers an even cleaner experience than that.

Due to how Google integrates Google+ in such a parasitic way I see no incentive for participating on their network except when I have something that is outside of my domain of expertise, something that I am not targeting commercially, something that is thin, or something irrelevant to say! That incentive structure combined with Google's photo meme feature will ensure that content marketers will help plenty of people see Star Wars stuff ranking for mortgage loan search queries.

When you own search/navigation you own language. that position can easily be extended into any other direction/market in a way a social graph can not:

"The only technology I’d rather own than Windows would be English," McNealy said. "All of those who use English would have to pay me a couple hundred dollars a year just for the right to speak English. And then I can charge you upgrades when I add new alphabet characters like ‘n’ and ‘t.’ It would be a wonderful business."

Further, Google can chose at any point to respond to or ignore market regulations in accordance with whatever makes them the most money. They can also fund 3rd parties doing the same (like undermining copyright) to force others to strike an official deal with Google to be "open."

A lot of businesses live on small profit margins, so Google's ability to insert itself & fund criminal 3rd parties aligned with Google's internal longterm interests is a big big big deal. Companies will learn that you either work with Google on Google's terms or you die.

When a public relations issue brews they can quickly change their approach and again position themselves as the white knight.

Brand Equity & Forcing the Brand Buy

Yahoo! put out a research paper highlighting activity bias, stating that the efficacy of online advertising is often over-stated because people who see ads about a topic were already more closely tied in with that particular network & that particular topic before they even saw the ad. As an example, any person who sees an AdWords ad for hemorrhoid treatment was already searching for hemorrhoid-related topics before they saw your ad (thus they were in the subset of individuals that might have came across your site in some way if you were in the search ad ecosystem or not).

This sort of activity bias-driven selection bias (homophily) exists on social networks online & offline.

Google did research on incrementality of ads & they came to the opposite conclusion as Yahoo! did. Google suggested you should buy, buy, buy, even on your own branded keywords. They suggested that testing was expensive (no mention that the only reason it is expensive is because Google chooses not to make such tools easily accessible to advertisers) & that the clicks were so cheap on branded keywords that you should buy, buy, buy. Many advertisers who mix brand & non-brand keywords together don't realize that they are using the "returns" from bidding on their own brand to subsidize over-paying for other keywords.

Google Analytics is the leading & most widely used web analytics program. They can share whatever metrics help them sell more ads (defaulting to crediting the last click for conversions, even if it was on a navigational search to your site) & pull back on features that are not aligned with their business interests (SEO referral data anyone?)

This goes back to Scott McNealy's quote: "The only technology I’d rather own than Windows would be English. All of those who use English would have to pay me a couple hundred dollars a year just for the right to speak English. And then I can charge you upgrades when I add new alphabet characters like ‘n’ and ‘t.’ It would be a wonderful business."

Analysts didn't understand why Google CPC rates were down 8% last quarter while overall search clicks were up 34%. The biggest single reason was likely more clicks on adlinks on branded AdWords ads. While a brand buying its own keyword typically pays far less per click than what some of the biggest keywords go for, the branded keywords typically have an exceptionally high CTR. Those additional clicks dragged down Google's average CPC, but the extra revenue they offered was a big par of the reason why Google was about to grow at 25% even though their display network only grew at 15%.

That slow growth of display is in spite of Youtube now serving over 4 billion video streams per day & Google adding display ads to log out pages.

Online views are not the same as TV views. A comScore study found that 31% of display ads are never seen. In spite of that, US online advertising will reach nearly $40 billion this year.

Google wants to insert itself as a needed cost of business in the same way credit card companies have.

On Google Maps they put an ad inside your location box.

Even if most people don't participate on Google+, Google can still force advertiser buy in through over-promotion of the network in the search results. On your branded keywords they may drive your organic listing below the fold & put Google+ front & center.

Facebook earnings are still growing much faster than Google's & Facebook encourages advertisers to advertise their Facebook pages, so even when you pay for the click Facebook still keeps the user. Facebook is adding apps to the timeline & is trying to win VEVO music video hosting from YouTube.

While Google is primarily known as a search company, it is getting harder to get off of Google though any channel other than a toll booth. Google keeps driving the organic search results downward, while Google verticals fill up many of the organic results that remain. Many companies already buy Google ads on their own YouTube content. Some buy ads on Google to drive them to their Youtube videos & then buy ads on their own Youtube video to promote their websites. Soon Google will try to push you to buy them on your Google+ page as well. Google is becoming a walled garden:

Google wants to control more elements of your social world now. They don’t just want to be a search engine.

Is that so bad? Maybe not. It’s certainly no different from how other companies, from AOL, to Microsoft, to Apple, to Disney, to Facebook, have viewed the world — as ideally a walled garden, an all-consuming platform that most people use for pretty much every form of entertainment and social interaction.

A lot of people thought that Google was somehow different. They were, of course, wrong.
...
To move forward either as the old Google or Google+, Google needs to be capable of making fair deals with the partner ecosystem. It needs to curb its instinct to kill competing media companies that were actually producing great content that Google helped you find.

I suspect there will be plenty of bloodshed before Google figures that one out.

"This is the path we’re headed down – a single unified, ‘beautiful’ product across everything. If you don’t get that, then you should probably work somewhere else." - Larry Page

Google no longer believes in the concept of the open web. Blame it on Larry Page becoming the CEO, blame it on him talking to Steve Jobs & Steve telling him to make fewer and tighter products, blame it on Google funding eHow, or blame it on basically anything. But if you go back far enough, much of the stuff that is going on now was clearly envisioned a decade ago:

I was lucky enough to chat with Larry one-to- one about his expectations for Google back in 2002. He laid out far-reaching views that had nothing to do with short-term revenue goals, but raised questions about how Google would anticipate the day sensors and memory became so cheap that individuals would record every moment of their lives. He wondered how Google could become like a better version of the RIAA - not just a mediator of digital music licensing - but a marketplace for fair distribution of all forms of digitized content. I left that meeting with a sense that Larry was thinking far more deeply about the future than I was, and I was convinced he would play a large role in shaping it. I would rather jump on board that bullet train than ride a local that never missed a revenue stop but never." - Douglas Edwards

What happens when the Google+ version of your content outranks the version on your own site? And what happens when your branded channel and/or your fans become a vertical ad silo Google sells to your competitors?

I tested submitting a couple posts to Google+ with a Wordtracker top keywords list & valuable keywords (on a cpc*traffic) basis in posts about top keywords. Those posts rank #2 or #3 in Google for many people that follows me. No harm to me since those posts were irrelevant to this site, but if they were about my theme & topic I just would have out-competed myself. When Google outranks you (even with a copy of your content) they get to taste the data again and sell off the attention another time. You only get a slice of that monetization, even when it is your work that is being monetized. Maybe it is great for stuff that is somewhat less relevant and/or keywords that are so competitive that you otherwise wouldn't score for them, but we have to be really careful we don't out-compete ourselves. Though if Googke keeps this up they won't be the only ones monetizing it. Give it a few months and celebrities will be selling sponsored Google+ posts based on some metric created by multiplying search volume, CPC & how many followers they have.

Is Bing Better? Will Enough People Ask That Question to Matter?

For years Google built their reputation as being the search engine that offered the cleanest & fastest search results. They were known for monetizing less aggressively than the competition. But over the past couple years Google has dialed up their ads to where they now send a greater ratio of ad traffic than organic search traffic. One Google engineer recently described the ability to rank highly in Google without buying their ads as being a bug that was getting fixed!

Google's big risk in their coupling of aggressive monetization, aggressive self-promotion & changing how users feel about user privacy is that they can create the perception that users should go elsewhere for for an honest or trustworthy search. This not only builds momentum for smaller search services like DuckDuckGo & Blekko, but has also won praise for Bing from Gizmodo, Dave Winer & The Next Web.

This is an interesting play:

BBVA, Spain’s second-largest bank by assets, is teaming up with Google to use its search engine results to provide advanced forecasts of hotel and tourism demand in the country, part of a plan to market real-time economic indicators to its clients.

The bank and internet group will announce on Monday a scheme called the “BBVA-Google tourism activity in Spain indicator”. The first pilot project has focused on measuring advance demand for hotel stays and tourism interest in Spain by using search engine data.

Private investors get to see that search data before anyone else does. If you have a retirement plan invested in stocks, then you are at an asymmetrical information disadvantage because Google is providing an in-depth look at that search data to competing investors who can trade on the information before it is public.

Is search traffic a big deal? Is there enough signal there to matter? Yes. And yes.

I read an investment report earlier today about a company where the hedge fund's rating & valuation was largely based on / justified by the SEO strategy of the underlying company & their current Google rankings...the report even had keyword ranking charts in it!

Was Google paid for giving BBVA access to the above data? Or was it thrown in as a freebie in exchange for getting over 100,000 BBVA workers to switch to the cloud & go Google on the enterprise software front?

If Google has over 90% search marketshare in many EU countries & is willing to leverage proprietary search data to win contracts in other fields, how does anyone compete against that data bundling?

Further, think of all the damage hedge funds & huge banks have done to societies the globe over this past decade & now Google is directly helping the bad guys.

That is Google's approach to their proprietary information: if you invest in their ecosystem and use their analytics tools you can't get your own analytics data (as they have to protect "user privacy"), but they will gladly sell that same data off to someone else.

If there is no public outrage at this "test" then the data units will start getting more granular. Rather than measuring categories Google may sell data on a per-site or per-company basis. Looking at how Google has consistently disintermediated "partners" everywhere else, if Google is feeling bold they may suggest that selling the data to others also permits Google to trade on the data as well.

What's far scarier than an angry search engineer looking at your large paid link buy or a rogue Google "contractor" hacking up your site? A Google hedge fund with a substantial short position on your stock. :D

Recall that Eric Schmidt has stated:

"One day we had a conversation where we figured we could just try and predict the stock market..." Eric Schmidt continues, "and then we decided it was illegal. So we stopped doing that."

Based on Mr. Schmidt's above comment, is it reasonable that Google now profits off leveraging their data for securities analysis? What made the above clearly illegal & what is going on now above board? What's the difference between them? Perhaps a "contractor" layer?

At the same time Google runs sweeping ad campaigns reminding people how Google protects them online, while hosting banking data in the cloud & making themselves a juicier hacking target.

Google warns publishers against using paywalls because it is a poor user experience while wiping out competing lead aggreagtors with new guidelines that are likely impossible to comply with. Sites like Highbeam Research get smoked by algorithms like Panda & the Google works with the folks who already have the legislature in their pocket to get them more data. The lesson here from Google is to provide a clean front end user experience and then sell the data back out the other end.

Everything is fine. Keep shopping (on Google.com + your Android phone)...Google will ensure the data is monetized to its full potential.