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Traffick: The Business of Search

Enlightened search engine analysis in handy blog form. Grab our RSS feed at and stay enlightened.

Updated: 2010-04-26T18:17:51.124-04:00


Google Affirms the Vital Role of Marketing and Advertising Agencies


It's great news that Google has taken the time to think through the pivotal role of agencies in helping advertisers advertise on the Google AdWords platform, and to release a new AdWords Certification program. As the head of a search marketing agency, I value the fact Google is explicitly affirming their philosophical support for the agency world at the same time as they release specific changes in programs and pricing that support that relationship. Official mission statements are important; they ensure that no one at any level in the company is hearing contradictory messages. Sometimes, all it takes for us to be able to work better together is to hear someone say (and write): you've got a formal place in our ecosystem, and a special place that won't be interchangeable with everyone else's place, or too easily devalued.So, the obligatory punch on the shoulder, and "aww shucks, thanks, guys".To be sure, no one is naive enough to think that Google won't also work directly with some advertisers. But there should be no more talk that Google is uncertain in its approach to the agency ecosystem, or that the powers that be at Google somehow want to "cut agencies out of the equation." You don't invest in support, agency teams, new certification programs, and new API models unless you're sincere in the support.Waiving AdWords API fees for agencies using their own bid management tools adds up to a significant chunk of change. It also, as Google notes, leads to more innovation. In developing new ways to automate marketing, developers at agencies (and the end client) won't have to mentally subtract out the cost of the API tokens when deciding how much time and money to invest in new tools. If some agencies abuse the privilege, that's easy enough to stop. Tell them to stop it, or the fees will kick back in (and their Partner status could be revoked).Outside the AdWords ad world, this might seem like a minor deal. To those in it, it's pretty significant because it means Google has indeed evolved into a mature player much as many of us hoped and expected.Here's a quick before and after to give you a sense of things:Before: A confusing Google AdWords Professionals certification that was very easy to achieve, handed out to a wide variety of semi-qualified individuals, with no clear delineation between scrappy upstarts who can pass a simple test, and who would be really interested in helping you with your AdWords advertising; and real agencies with infrastructure and a track record of working cooperatively with Google and solving many client problems over time. Later, a Qualified Company certification got bolted onto that. While a step in the right direction, it left too much confusion in the marketplace and didn't give enough credit to the difference between entities (agencies) and individuals (anyone who can get a decent grade on what amounts to an open-book exam).After: A redefinition of the Qualified Individuals status to help individuals showcase their talents to potential employers (not directly competing for clients with more qualified agencies or experienced in-house talent); a redefinition of the Partner Certified Qualified Companies to mean more rigorous exams, and a range of other benefits like a searchable Google Partners listing.There's quite a bit more to it, but that's a start.I started as early as 2005 trying to articulate the case for such an evolution at Google -- mainly, in both editions of Winning Results with Google AdWords. While many in the space sort of took Google's informality at face value (panting with lust at any announcement of any kind of Google certification), I always figured they'd have to take another crack at this because the ecosystem of resellers and partners (assuming it demonstrates its value and shows itself deep, wily, and resilient enough to maintain customer relationships as opposed to being disintermediated/crushed) must be treated formally as such, much as it always has been in the technology world, with companies like Microsoft serving as the global standard (but there have been hundreds of [...]

Twitter Ad Potential: Huge (Source: History, Users' Love of Searching)


Regarding that last post about Twitter and monetization, I haven't changed my mind on all of it, but for the projection/prediction part about Twitter potentially putting up very modest ad revenue numbers in the first two years. That part, I realize, is wrong!Certainly, they're well behind Facebook in many areas (revenues included) and possibly will continue to be forever, but what they have going that Facebook doesn't have as much of yet? Search! (Fascinating piece today by Eli Goodman of comScore: What History Tells Us About Facebook's Potential as a Search Engine, Part 1).Goodman's point so far seems to be that as search improves and as users come to expect it to be highly useful, usage increases, familiarity with the tools increases, etc. This is going to happen with Facebook, and it's going to happen with Twitter.By contrast with Facebook, though, Twitter already gets 19 billion monthly searches -- about 19% of what Google does in a month. Astounding. That with a search platform that often doesn't work well, or sometimes return any results at all. Twitter searching is going to grow to incredible levels. And where inventory and granularity are that huge, even very cautious forms of monetization lead to sizeable revenues and positive feedback loops in CPM rates and user satisfaction.So I'm coming to the realization that 2011 is going to be a strong year for Twitter's ad revenues, and 2012 could shock people.A huge wrinkle here, though. Those supposed 19 billion monthly searches count API calls from third parties, and that would include standing queries from users, more like how people use feeds to display their favorite content. But hang on, isn't that a good thing? That's great contextual information and where there is such great contextual information, eventually there will be ad deals, and ad revenues. Sure, there will be ad-free ways to use third party tools, just as some advertising will actually appeal to users (or at least they will tolerate it).Based on a more conservative definition of a "search," let's dial the 19 billion back, then, to around potentially one billion actual searches per month in 2011 for either Twitter or Facebook (so, more like 1-2% of Google's overall volume). That's still impressive. Based on Eli Goodman's logic, that could certainly lead to a snowball effect of bona fide search product development and bona fide user addiction. In essence, the search product and ad product teams at Twitter and Facebook alike won't be able to hire people and build products quickly enough.Promoted tweets, then, should be viewed just a light pilot project to try something sort of "alternative" in the space for a reasonably guaranteed amount of cash. Down the road, Twitter can monetize something we're all very familiar with as the highest-CPM, win-winningest, digital advertising channel: search and keywords. I doubt Twitter's founders or any of the early adopters predicted this type of user behavior in the early going. Certainly, it's a credit to them and their far-sighted investors that they all bet big on the potential and the direction of user excitement, rather than trying to get too specific about how it would get used or how it would make money, too early on. ----- Download a FREE E-Book by Andrew Goodman: Google AdWords: A Brave New World Are you new to search marketing and looking to come up to speed quickly to Google AdWords? Or maybe you’ve just fallen a tiny bit behind, and you’re looking to re-engage with the latest thinking. If so, Andrew's free e-book is for you.[...]

Twitter's Monetization Model: On the Mark, or Off-Target?


As Twitter moves to pilot its first experiments in monetization, it might be interesting to speculate on its prospects for success. To help, I'll go through some of the elements of success and failure that have been proven in the last twelve years or so of online advertising experimentation. Without all of these elements being in place, ad-supported models have tended to fail.1. Large enough audience to matter. Wrapping some ads around content or functionality geared to a relatively small audience is tricky on a number of levels. First, no one in the press cares, and investors don't care. Most importantly, advertisers and agencies don't care, since there's not enough to buy, so you get lumped into remnant or at least underpriced network inventory unless you've got a really smart little sales force. Second, any hiccup gives you a greater chance of killing the golden goose of whatever you wrap the ads around. Third, you lack statistically significant data for testing and refining, so it's hard to perfect. Fourth, related to the third point, dipping a toe into the water becomes difficult. Large publishers can run tests without alienating anyone as they test the model in a small sliver of the content.2. Targeting by keyword. Publishers and ad mavens have bent over backward to insist that targeting can be based on concepts, personalization, demographics, and factors other than keywords. Even Google, the King of Keywords, began fairly early in its attempt to paint the keyword as only one sub-facet in the global effort to better align advertising with user tastes and intent. (Bonus: that effort to blend into the woodwork might have helped Google in court if trademark and patent lawsuits really started to escalate out of hand, or if they started losing cases so badly that they'd need to substantially revise their business model ahead of schedule.) Deny it all you like, but keywords still "click" with advertisers. Users like them too, because it's a way of seeing relatively relevant ads without feeling too creeped out. Keywords triggering relevant text ads and offers are the display-advertising-in-content cousin to permission marketing as it was conceived by Seth Godin for email. Somewhere, a line can get crossed. Keywords do a really great job of helping advertisers and users connect without that line being crossed as often.3. Doesn't get in the way, or even at times enhances the experience. Advertising is a necessary evil to some, but to a substantial part of the population, it's a buying aid or even a cultural experience. Glossy ads in fashion magazines are part of the "art" and "positioning" and are seen as less intrusive than advertising that really "gets in the way" of reading an article online. The same goes for billboards by the highway: an eyesore to some, they're a part of cultural history to others -- and hence, provide free buzz over and above the advertising cost. Burma Shave was before most of us were born, but chances are, you've heard of the roadside signs.4. Is in a place online that people willingly go to or are addicted to, rather than being an app that is a bit cumbersome to use, take-it-or-leave-it, overly incentivized (paid in points or cash to "surf,"), or weakly appreciated but maybe a flash-in-the-pan. Related to this, the user base has to understand what the owners plan to do around advertising and what kind of "trade-off" they can expect. Do they get involved in using something for one reason, then find it's infected their user experience or device (i.e. "scumware")? Or is the format and the trade-off relatively transparent?5. Isn't susceptible to "banner blindness". For the time being, we can consider this one relatively unimportant, as initially, enough advertisers will be lining up to try new things where the audience is big enough and attention can be grabbed. But performance marketers are turned off by ads that don't perform, and historically these types of ad formats have had limited upside when compared with personal, anticipated, and relevan[...]

Don't Go to Google, TripAdvisor, or OurFaves for Restaurant Reviews


If you come to my town, where's the best place to go to look for that perfect restaurant, or opinions about a place you're considering dining at? Me. Seriously.

And maybe a few of my friends.

We know the truth.

You can sometimes get some of that truth from Toronto Life and Zagat.

Once in awhile, we'll maybe go write a review on Yelp. But probably not. If you ate at 50 places a year and 30 of them are really good, you'd tire of writing it up.

So, if you go to Google's review aggregation that includes results from TripAdvisor, OurFaves, and Google itself... you'll see a bunch of inexplicable one-star reviews for some of the best restaurants in the city.

"I could barely see my food..." Have you heard of ambience?

"The staff was unfriendly..." ... after you put ketchup on the filet of sole.

"Cramped..." Sorry it isn't the Rainforest Cafe.

Don't get me wrong: I'm a big fan of user-generated content and recommendations. Unfortunately, when you go to TripAdvisor, you often have to wade through the most inexplicable, knuckle-dragger "reviews" of some of the best hotels and restaurants known to mankind.

It's also an interface issue with Google's review aggregation, though. The Harbord Room actually averages four stars on Yelp... but you wouldn't know this from Google's tally, which makes it look like there are a lot of dissatisfied visitors, and the average looks like it's just over one star.

You know what? Just let me make the reservation, and if the place is no good, I'll take full responsibility. :)

In the meantime though you could trust good reviewers like this guy.

Can Search Engines Sniff Out "Remarkable"?


I never tire of listening to experts like Mike Grehan speaking about the new signals search engines are beginning to look at, because it's so important to bust the myths about how search engines work.To hear many people talk, today's major engines are faced with little more than a slightly-beefed- up, slightly larger, version of a closed database search. Need the medical records for your patient Johnny Jones, from your closed database of 500 medical records, just type in johnny or jones or johnny jones, and you're good to go. Isn't that search, in a nutshell? It is: if you can guarantee that you're referring to a nutshell like that. But with web search, it's nothing like that.The World Wide Web now has a trillion pages or page-like entities... that Google knows about. (They don't know what to do with all of them, but they'll admit to the trillion.) Some observers estimate that there will soon be five trillion of these in total, too many to index or handle. Who knows, maybe 10% of that could be useful to a user or worthy of indexing. But until some signal tells the search engine to index them in earnest, they'll just sit there, invisible. That's out of necessity: there's just too much.The difference isn't only quantitative, it's also qualitative. User queries have all sorts of intents, and search engines aren't just trying to show you "all the pages that match". There are too many pages that match, in one way or another. The task of measuring relevancy, quality, and intent is far more complex than it looks at first.And on top of that, people are trying to game the algorithm. Millions of people. This is known as "adversarial" information retrieval in an "open" system where anyone can post information or spam. The complexity of rank ordering results on a particular keyword query therefore rises exponentially.In light of all this, search engines have done a pretty good job of looking at off-page signals to tell what's useful, relevant, and interesting. The major push began with the linking structure of the web, and now the effort has vastly expanded to many other emerging signals; especially, user behavior (consumption of the content; clickstreams; user trails) and new types of sharing and linking behavior in social media.This is a must, because any mechanical counting and measuring exercise is bound to disappoint users if it isn't incredibly sophisticated and subtle. Think links. Thousands of SEO experts are still teaching you tricks for how to get "authoritative" inbound links to your sites & pages. But do users want to see truly remarkable content, or content that scored highly in part because someone followed an SEO to-do list? And how, then, do we measure what is truly remarkable?Now that Twitter is a key source of evidence for the remarkability of content, let's consider it as an interesting behavioral lab. Look at two kinds of signal. The first is where you ask a few friends to retweet your article or observation, and they do. A prickly variation of that is where you have a much larger circle of friends, or you orchestrate semi-fake friends to do your bidding, with significant automation involved.But another type of remarkable happens when your contribution truly makes non-confidantes want to retweet and otherwise mention you. When your article or insight achieves "breakout" beyond your circle of confidantes, and further confirming signals of user satisfaction later on when people stumble on it.Telling the difference is an incredible challenge for search engines. Garden variety tactical optimization will work to a degree, mainly because some signals of interest will tend to dwarf the many instances of "zero effort or interest". But we should all hope that search engines get better and better at sniffing out the difference between truly remarkable (or remarkably relevant to you the end user) and these counterfeit signals that can be manufactured by tacticians simply going through the motions. ----- Downloa[...]

Yusuf Mehdi's Too-Candid Comments About Abandoning the Long Tail


Credit Yusuf Mehdi for honesty: in his remarks at SES New York last week, as reported by eWeek, he noted that Microsoft fell well behind Google in search because it focused on doing well for popular queries, when it should have known that search is "all about the long tail."It is bizarre, because every notable failure in search since 1994 has basically been in the realm of curated results and chances are, that trend will continue. Whether they're hand-edited search results or partially "produced" variations of web index search focusing on improving the treatment of head terms using the efforts of channel producers, the market kept coming back with the same response: this approach doesn't scale. A website with opinions about what people should focus on is not a search engine, it's just a website. And that creates a serious positioning problem when you're competing in the "search engine" space, which needs to scale to help people find hard-to-find information. Forget the long tail: channel producers and editors even do a poor job of producing information around the "torso". As information and customer demands evolve, it becomes difficult to keep up, and many of the real world uses of the search engine begin to look like a "demo" of "well, this is how it works over here, on this query, in theory, and eventually we'll get back to extending the technology so it works for the stuff you're looking for, with partners who provide information in a way that you prefer, which changed in the past year."Here's a list of some of the search engines that haven't caught on precisely because they failed to understand and gear up for the massive scale required in the search engine business, focusing instead on curating results for a limited set of popular queries or categories:Yahoo DirectoryOpen DirectoryLookSmartAsk JeevesMahaloThe list could probably be much longer.Others have fared a bit better because they didn't claim to be search engines. These include:About.comSquidooObviously, many of these properties are of limited use in the real world of finding info.The bizarreness doesn't stop there, however. A significant aspect of the PR rollout of Bing was focused on the fact that Microsoft knew it would be most effective -- again -- at doing better for users in the realm of more popular types of searches, ceding long tail excellence to Google. In terms of positioning, that's like saying Microsoft is good at negotiating partnerships, designing interfaces, and subscribing to web services. That's like saying Microsoft is building a portal. That's like saying Microsoft is Yahoo.Google itself is no saint when it comes to long tail accomplishments and relevance. On many counts, all search engine companies have waved white flags on truly scaling to address all potential content, because there is just too much of it (and too much spam). Dialing back on the ambitions of comprehensiveness, to devote more screen real estate to trusted brands and search experiences that are tantamount to paid inclusion, is Google's current trend, much as it was for companies like Inktomi and Yahoo in the past.The industry consensus is that search is far from solved. But a prerequisite to solving any problem is trying. Microsoft is signaling that they will continue to dip a toe in the water and essentially "wimp out" when it comes to addressing scale and complexity issues. This is in line with what they've done all along, and the positioning for Bing. The question is: if Google's wimping out too, wouldn't you rather use the relatively less wimpy search company that has committed a massive budget to R&D, probably 30X Microsoft's? By sending these signals, Microsoft is not exactly giving users good reasons to use their products. It's reminiscent of the trajectory taken by companies like AOL and Yahoo, who didn't feel that search was a problem that could or should be solved by them, so they contented themselves with staying hands-off[...]

Google AdWords: No More Last-Click-Attribution Blues


Getting credit for an online conversion - and giving due credit to all recent influences - has been one of the hottest topics in digital marketing over the past couple of years. The urgency of the matter has grown as media costs -- especially click prices on paid search keywords -- have risen.Marketers have been so hungry for better attribution of "keyword assists" (or simply, the non-overriding of the first click in the sequence towards purchase, whether that's over a matter of hours or many months), they've been willing to explore cumbersome customizations in a variety of analytics platforms, including Google Analytics.But if you're looking to simply analyze the contribution of paid keyword searches on Google Search that preceded the keywords that led directly to a sales conversion (aka "assists"), you'd prefer to see all that data rolled up conveniently within Google AdWords itself, showing the data in handy formats that might make it easy to change your bidding patterns. In particular, earlier stage keywords (typically, before a last-click brand search) would now be revalued in your model; you'd bid them higher in cases where they made assists.Happily all of this is now rolling out in AdWords as part of a reporting initiative called Search Funnels. A variety of reporting options help you tap into the power of this new information.Earlier, when I defended the "last click"'s merits as an attribution method, I pointed to some data by Marin Software showing 74% of etail conversions only have one associated click - even counting assists. Moreover, Marin's approach bucketed prior clicks categorically, arguing that if a prior click was very similar in intent or style to the last click, then the extra information wouldn't be enough to cause you to alter bidding patterns anyway. That knocked the number of truly "assist-powered" conversions (that you could actually attribute properly) down to 10% or less.This is where Google's new reporting needs to be scrutinized closely. In your individual case it could be quite valuable, but in current individual case studies Google may have on hand, anywhere from 70-95% of conversions only have one click to speak of. If Marin's logic above is even close to sensible, then it does underscore the limits to assist data. There will be some value attributable to assist keywords in around 10% of conversions, give or take. That's actionable but not earth-shattering. Of course, this is going to be most valuable to advertisers who have a lot of prior influencer clicks hiding behind a high number of clicks that are currently attributed to a last-click on the brand name.To pump up the role of prior keywords, it might be fair to also point to assist impressions - views of the ad on Google Search where the ad wasn't clicked, but shown. But in those cases was the ad really seen? Perhaps not, but there may be some value in knowing what search keywords got the searcher's research motor running. Perhaps they clicked on a competitor's ad. Google is offering impression assist data as well with this release, which will be sure to delight trivia buffs, AdWords junkies, and Google's accountants alike.Remember, we're not just talking about multiple searches all done in a single day, or in one session. Google is logging the time and date of every search by that user prior to a purchase/lead, and when a conversion happens, full funnel information is available as to the time lag between clicks and before the conversion.Adding in impression assists to the mix, we may see past search query information for up to 20-25% of conversions in some advertiser accounts. Again, while not stupendous, this at least counts as extremely important and material to how you approach keyword value.The ease of sorting in order of frequency of conversion by assist keyword helps not only to see the keywords in question, but with the "keyword transition path" view, you can see wh[...]

Ad Network Confusion Mounts


The announcement that an ex Doubleclick platform lead is launching a search retargeting network sounds interesting, but it serves as a key reminder that the display ad space remains mired in confusion.

Niche ad targeting concepts are interesting and attractive in principle, but in terms of total volume and advertiser priorities, they still look like they're nibbling at the margins. That state of affairs gets worse when you realize that literally hundreds of viable networks, exchanges, hybrids, and resellers are nibbling at that same sliver of pie. This creates a paradox of choice for the buyer, and more likely than not, their first "next move" will be to buy from a brand they know and that sounds big, directly: like Facebook.

The problem seems to be: every time another company comes in aiming to disrupt the display ad space, they join the other 500 companies that have been threatening to do the same thing -- since 1998.

Yelp, Extortion, Spam, and ... Oh, Just Stop It!


Yelp has run into its share of problems, with a third lawsuit emerging, alleging that their advertising sales practices are akin to "extortion."On top of this, the tone of comments about the company -- at least in some circles -- has turned nasty.Yelp is popular, so they've got a big target on their forehead. Businesses (as we saw many years ago with Google) suddenly wake up to the opportunity; some see it as a place to spam; the publisher-slash-algorithm upholds editorial standards in a realm where, for whatever reasons, certain businesses feel a sense of entitlement. Is it because the business model is new? Businesses may have grumbled about yellow paged directories over the years, but there aren't lawsuits accusing listings salespeople of extortion rackets.Remember: Google went through the same thing in the days following algorithmic changes that took aim at SEO practices like link farming. The little guys who were "put out of business" by Google's "unfair" algorithm changes made for compelling copy in wire stories, but a strong sense emerged in the wake of that: no one owes you a living built around free traffic, and building your whole business model around a free high Google ranking doesn't earn you much sympathy from anyone.Plus, it was a zero-sum game to an extent. The companies who were featured more prominently in the algorithmic listings certainly didn't complain when the other guys dropped. Everyone can't be first. As a result, there will always be disappointment in ranked listings, just as there is after each Olympic medal event.Of course, if there is something to spam, aggressive (gray-to-black-hat) SEO's will try to figure this out. This group wants to know how to "spam the Yelp review filter" which really means raising the trust level of fake reviewers so automated flags aren't as likely to send reviews to editorial. That's similar to the tactical SEO mentality of "aging sites and domains" for future use as authority sites for link spam. This line of thinking is clearly of the variety of "you have eyes, but can you really see"? A local business *should not want* to astroturf Yelp with fake reviews. Think the logic through. To really move the needle, you'll need more than one fake account or to get a bunch of long term fake reviewers in your employ. This is the type of thing that eventually comes out in the wash, somehow, as sure as Tiger sexting about threesomes. And when it does, your business credibility is shot.Because such dangerous lunatics are out there providing advice to businesses, review sites take a hard line, and disallow content and ratings as they see fit if the reviewers don't seem trustworthy. (Don't you wish Twitter took a more aggressive stance on banning fake accounts?) This gives the appearance to some businesses that their "great reviews" are being removed maliciously. I submit, it's part and parcel of weeding out spam. (See above, where someone openly writes about "how to spam that".)In the end, the goal is pretty straightforward: editorial content that helps users find things, make better choices, and lead better lives. It also has a social component, though, so these review-sites-slash-social networks need to be a bit careful about how aggressive they are in banning people per se. Maybe some people trust other people and that's their business. Behind the scenes, for the purposes of the algorithm, the trustworthiness or publishability of certain reviews can be discounted or downgraded, but the process needs to be as transparent as feasible. (This analogy with Google might help: it can't actually "ban sites" from existence (just its index) or "tell sites not to link" or "tell you not to trust a site"... but it can quietly remove the "link juice" from links that its algorithms feel are fake or part of a scheme. That's their prerogative. Don't like it, ask another search[...]

Go Deep With Our Paid Search Training at SES New York, March 22


Are you and your company dabbling in paid search, but feel that you're far from maximizing the assets you have? Or you're thinking about investing, but don't know how to get fully up to speed in the shortest time possible? Or maybe you were into it five or six years ago but need a serious refresher course, or are an SEO, developer, or another related professional looking to diversify your skill set.

Well, you can browse the forums or sample the short presentations at the conferences, but to get as much as possible in the shortest possible space of time, nothing beats a full day of paid search training, with detail-by-detail examinations of fundamentals, new ideas, live workshop sessions, and more.

Led by me and Mona Elesseily, the Page Zero paid search training course takes place in conjunction with SES New York on March 22, 2010. What's even better - you can take 20% off the already low price if you use coupon code SESPPC20 when you sign up.

Check out the agenda, and sign up early to avoid disappointment.

Making Marketing Matter: A Reply to Mitch Joel


Taking Mitch up on a challenge like joining the dialogue as to how we can make marketing meaningful (and not scummy) carries only one danger with it: you can overshoot, egged on by the spirit of the exercise, and say something you really don't mean.Back before Howie Mandel had a serious(?) career, he appeared on one of those late night comedy shows that was so late that you had to use "late" like five times in the title. This was back in the days when Howie inexplicably put a latex glove on his head and did that thing with his hand when he did standup. Anyway, Howie would appear in a sketch where everyone was sitting around after a couple of drinks, usually near an open window, describing their most edgy or daring escapades. Howie would open his mouth and overshoot the level of the group so far, with the filthiest, most perverted comment imaginable. Even the most depraved members of the group would slowly edge their way out of the room.Then again, probably no danger of that here. If you've really built your career around Cluetrains, Whuffie, Permission, Life After the 30-Second Spot, and the like, as I have, you've probably reached the point of no return.Anyway, to throw some fuel on the fire:I still believe in an abstract distinction I introduced in Winning Results with Google AdWords (2nd ed.), and that is that there is something called "reasonable targeting," to be contrasted with "surplus interruption." Empirical evidence appears to suggest, as Godin has boldly argued for years, that people simply avoid messages if they get too many of them that aren't personal, anticipated, and relevant. But evidence aside, you have to believe it in your heart.I want to live in a world - not exactly like, but similar to - Google AdWords, where relevance is rewarded and spammery is punished through a sort of "user experience tax". I also want to live in a world where we can freely experiment with a variety of forms of advertising. The "AdBusters" and "no logo" crowd take it too far, not understanding that imposing a moral code that restricts communications is a (totalitarian-style) cure that is worse than the disease.I do not want to live in a world where:We change the definition of permission (and other things), because we're marketers and hey, it's OK to spam people if you're a big company, right? This just creates a tragedy of the commons and degrades consumer trust over time. See Seth Godin, "Permission Marketers: Did We Blow It?" (September, 2001)The professional association for marketers in a given nation sells me on a membership renewal, in part by telling me they'll continue lobbying to loosen up on those horrible "do not call" laws. As a consumer, I hate to be spammed on my personal phone lines. I'm supposed to feel differently as a "marketer"?For that matter, in my renewal application for the same association, in 2010, it would have been nice if the same trade group had finally put in a checkbox for "search marketing" as a special interest, given that it is nearly half of digital marketing, and certainly more than half of the (targeted, voluntary, granular) traffic to many corporate websites. To go alongside the checkboxes for companies specializing in printing brochures, keeping databases, building websites, maintaining outbound call centers, and emailing people. Maybe next year. ----- Download a FREE E-Book by Andrew Goodman: Google AdWords: A Brave New World Are you new to search marketing and looking to come up to speed quickly to Google AdWords? Or maybe you’ve just fallen a tiny bit behind, and you’re looking to re-engage with the latest thinking. If so, Andrew's free e-book is for you.[...]

Yahoo: It's Worse Than It Looks (Again)


Techcrunch reports on a Wall Street analyst's recent analysis of Yahoo (YHOO).

Among the more painful realities:

  • Only a third of Yahoo's $21b valuation derives from US assets.
  • Yahoo's stock-based compensation, awarded to employees and managers with low morale or who foster poor morale, is generous even by the standards of generous compensators like Google or Facebook.
A picture of Yahoo emerges as a company that manages a stable asset, not one that forges new ground. Maybe an appropriate stance for a half-century-old media giant, but a sad fate for a company many of us not long ago still considered a "cool" Internet player.

Europhobic Response to Google Antitrust Issues - Not Productive


The latest bubblings of legal action against Google for anticompetitive behavior are, many believe, just the tip of the iceberg.

One thing that surprised me about some people's reactions to this, at least in the US, was the assumption that it was all about European companies and regulators being, well, European about things: envious, bureaucratic, anti-American, etc.

But that misses the point by a mile. The key point of comparison in the broader discussion is always Microsoft. And the biggest legal hit to Microsoft's empire came in the United States.

This week, some European companies are disgruntled with Google and some Italians are throwing a scare into Google execs by literally "jailing" them (albeit with suspended sentences) around some privacy legislation.

But when the real questions start being asked about anticompetitive behavior, they'll be asked on home turf, as they were of Microsoft. And those questions, mind you, require a titan like Bill Gates to stand there as a mere mortal and admit to the specific discussions and specific strategies used to attempt to push key competitors (like Netscape) out of business. That's the power of the US legal system, and don't think it won't happen someday with Google.

Chortling about hidebound Europeans might be comforting in North American digital circles, but that analysis is neither fair, productive, nor predictive of future outcomes. Google, inevitably, will be called on the carpet for many potential violations of antitrust. Not by the "FTC" for "misleading" disclosure of paid search links (sorry Danny, that's a dead issue). But - potentially - for doing exactly what Page and Brin warned search engines could do, in their legendary paper "The Anatomy of a Large Scale ...". Using their position as a monopolist to manipulate which major competitors get to show up, where, and how, in the mix of search results. And boosting their own properties relentlessly when others should be findable. Just for starters.

This being said, I'm never a fan of nuisance lawsuits and petty nitpicking. Time will tell if Google is inside the law in many different areas. I'll be back in a bit with some pro-Yelp thoughts, as they fight off silly conspiracy theories about "extortion" of small businesses. (Necessarily speculative, as court cases must be decided in court, where they belong.)

One-Day Emarketing Conference in London (Ontario) - Monday March 1


SES London was a smashing event, but you don't have to fly across the pond to get an early spring tuneup for your online marketing. If you're located anywhere in Southwestern Ontario, this event - Turning Clicks Into Customers - should fill the bill. And best of all, it's all taking place in a single day at a convenient venue. The Lawrence Kinlin School of Business at Fanshawe College in London, Ontario, hosts an e-marketing conference next Monday, March 1, 2010.

I'll be speaking on Actionable Analytics (Beyond Lip Service). I'll be joined by keynote speaker and good friend Mitch Joel. Other dynamic speakers include Liz Gray, Alan K'Necht, and Brady Murphy. A great opportunity to learn and also network in a collegial environment. More info about the agenda here.

Why Google Buzz Is, Um, Not Quite Right For Me


I've just tried out Google Buzz and I couldn't quite put my finger on why it just wasn't going to be convenient for me to use. But there was this nagging feeling.

Then I realized: services like this are premised on the notion of a single GMail account, a single Google account, or perhaps, just on a certain world view of what people use these accounts for.

Before we were supposed to somehow accept that we live in Mark Zuckerberg's "post-privacy world," the savvy among us began segregating our lives out manually. Spam-boxes, personal email accounts, business email accounts, etc. And then, for me, within the business side (which admittedly overlaps with the personal, given that life is social), it began to be a matter of practical importance to set up even more functional accounts. Skype accounts to talk with teams; Basecamp to talk with other teams. Google Talk to talk with the core group of people. Avoiding the other Google Talk account when people I barely knew began pinging me. Rafts of Google accounts to cover different functions with AdWords and Analytics.

I'm as social as the next person, as anyone who reads the blog posts or the tweets knows. Hey, I just tweeted to @craigyferg, and half-expected a reply.

Then again, I've been a bit shy about Facebook. And probably too fragmented to figure out which platform I should actually live in.

So which Google Account would I put my Buzz in? The business one? Not really, given that I'm trying to avoid distractions there. The personal one, which is for family mainly, plus being a spambox and a place to get invoices when I buy crap? Well, as one of several legacy accounts, it's a jumble, and it's linked to a large address book and a certain Picasa account, and a GTalk account I rarely use and don't want to use. And it makes me uncertain about how much to share, to whom, when, and why.

So the solution is: maybe just go back to Twitter, where the activity is more conscious and there is less integration with everything else, so I'm not tripping over all these overlapping accounts.

Twitter-killer, no. Another step towards the gradual loss of privacy and towards making unconscious decisions to overshare, probably.

It seems like a fun way to communicate for the typical person who has a single account and feels comfortable sharing in a certain way. But isn't it late to the party? Didn't we join Facebook because Facebook was "for that purpose"? When we signed up for GMail, wasn't it for another purpose?

At the end of the day, don't many of us want to put the brakes on all of this Google integration, and just have conversations for specific purposes with specific friends and teams of our choosing, rather than being stuck in this half-broadcasting, gotta-customize-and-remember-whether-you're-oversharing, world? Just askin'.

Myths Busted: Feb. 9, 2010


It's little wonder people are paid big sums of money to remind the layperson of what seems really obvious to the people who work in a specialized field every day... how helpful are you? Here's a test.

1. Newbies to AdWords are taught that "Quality Score is made up of a whole range of factors these days, including landing pages! Yep, those landing pages are really important. Gotta look at that."

Help the newcomer learn faster with:

(a) A reminder that CTR is what they should be worried about, if Quality Score is something they should worry about.

(b) A really convoluted explanation that has them believing that the tooth fairy creates optimal landing pages that result in high Quality Scores, for some reason now forgotten.

2. An important event page not only isn't ranking well in organic Google, it doesn't even appear to be indexed yet. Help troubleshoot the problem by:

(a) Fiddling with the XML Sitemap.

(b) Clicking the result when you find it in Google (dang, won't work this time... as it isn't in the top xxxx results).

(c) Notice that the TITLE TAG is a really long sentence that highlights a bunch of generic words and saves a few of the target keywords for somewhere in mid-paragraph. Recommend changing the title tag to more or less match the target search query.

Troubleshooting is harder than it looks, because some things are just so darn obvious it's all too easy to trip over them.

Social Media: It's About Mission, Not Measurement Alone


"This is not about measurement, but about organizations and their capacity to manage this changing real world of reputation. They find it hard to do this, because they're stuck in an old-world broadcast model."The speaker: Bryan Eisenberg. The setting: a past SES London conference, at an All-Star Analytics panel.This year's SES London is, once again, particularly heavy on Analytics all-stars. As it should be. Search marketing is accountable, performance is king, and any digital marketer can improve their lot by doing a better job with the analytics toolkit.But some people and some companies will confuse that importance with a blind faith that the measurement gurus can solve their larger strategy problems. Even the esoteric ones. Like the above question that came before the panel, roughly speaking, asking: "Hey super smart panelists, can you tell me some metrics that will help us decide whether our social media is WORKING?"The inside-the-box answer is: measure this, measure that, and adopt the same approach to social media as you do to other channels. If you "scored," it's "working." Of course, you can measure a lot of these types of things -- just not with Omniture. Remember, the old public relations world, where a "positive mention" in the "Washington Post" is something you can count? You don't need Jim Sterne or Steve Rubel to tell you that. Nor can these experts help your organization get really good at all the stuff it needs to do to get there.The out-of-the-box (Bryan's) answer to the social media measurement question is: sure, we'll get around to the measurement piece -- but if you're looking to "hit targets" with your social media spend, or to measure whether "it worked," maybe your organization has given you the wrong marching orders. We don't need more statisticians in this realm: we need more companies who are willing to fundamentally transform the ways in which they communicate.I say again: (or actually, the panelists said it last year): "Can you put a dollar value on a conversation?"Sure, you can. But let's start with getting your organization aligned with the idea of a conversation first. The only social-media-savvy company initiatives that will typically hit short-term targets are those that are architected on a broadcast model, so they defeat one of the key purposes of public relations, which is to change perceptions. And to put specific content into the public's awareness of you. To position your organization to carry on conversations that lead to business results, throughout the organization, over time, as a matter of course. Setting up your campaigns based on thin measures of short-term success might actually spur more negative conversations than positive! Or just not get you anywhere fast. You can measure that you're not getting anywhere fast. Great.Reputations are built over time. You'll never get there if your organization has a bias for shutting down the conversation channel early because "it isn't working." Or you're insulting members of your community by being too goal-directed in online conversations, because you've incentivized your community manager by paying them a bonus for warm leads or upsells.Am I saying you can't or shouldn't measure PR 2.0? Of course not. But if the milieu is vastly different, then you may have a lot of trouble measuring the impact, and you should probably be measuring something very different. Something that might not even be readily available in today's Google Analytics platform. "Engagement" can't just be about spending 3:28 on a website, or deciding whether someone visited the "About Us" page... as important as those may be in the ordinar[...]

Life Is Good


How are things? Trick question: it's a matter of perspective. It's a matter of how you frame things.

Hardly anyone searches for "february blahs" (you can look it up on Google Insights for Search), so full steam ahead? Not so fast. The number of people searching for "winter blahs" eclipses that by what looks to be a hundredfold.

And that's nothing. Queries for Seasonal Affective Disorder outstrip searches for winter blahs, a hundredfold, a thousandfold, who knows. :(

But then again, if yo(image) u compare *that* to fun, active queries like "super bowl 2010" or "vancouver olympics," SAD isn't even on the radar.

Go team! Enjoy the rest of your week, either dreaming of spring, or making the most of winter -- whichever it is you do.

Is Your Search Marketing Knowledge Outdated? You Know What to Do


It's becoming a truism that search engine marketing as practiced by busy in-house marketing managers, and others in similar positions who may drift in and out of direct responsibility for those initiatives, need serious "brushing up" every year or so. That used to be described as "changes in the search ranking algorithms you need to keep up with." Now the issue is broader, with changes in the paid search algorithms, new search products, blended search, and more.Much like going to the dentist, it's polite to claim that you go in for a refresh every six months, and it's polite to tell the dental people that you really do floss every day. But if it's been one, two, or three years since you took a close look, well (cough cough), we'll look the other way and point out that it's what you do next that matters most -- not how many months or years you've been away.How silly are some of the outdated paid search theories of the past? Well, I couldn't quite believe it when I came across this old piece by myself, pre-Quality-Score, in 2004. (As an added bonus, it was published on a site by my friend Mike Grehan (then being called Mike "Merlot" Grehan) and with associate editor Christine Churchill, another great in the biz.) The piece talked about a narrow tactical debate about high CTR's and whether racking up a strong account history based on overbidding might actually get you discount prices to stay in high spots later on. The CTR history would create a "seal," insulating you from competitors for a long time, unless they bid ridiculously high.In reality, it was a flukey and inconsistent strategy at the time, as Google already made it clear that CTR (important in the PPC ranking algorithm) was "normalized for ad position". In other words, just because CTR's are naturally higher in 1st ad position than they are in 5th won't make it impossible for you to rise up through the ranks if you spend some initial time testing the waters in 5th. You don't get undue "credit" for hanging out in 1st spot, either.That's evolved even further, in a couple of ways. Quality-Based Bidding is now 4.5 years old and the algorithm is more opaque and more complex than Bid X CTR. A separate quality check, of your landing page and website, has been working in the system for 4 years, ever-evolving. Well, about 18 months ago, a bunch of folks over on the SEO side discovered all of this and promptly started handing out bad advice that paid search quality scores somehow depended on tweaking landing pages for keyword relevance. Not a terrible idea, but terribly misleading advice.The second change, related to the first, is that account strategy today needs to be more comprehensive. The auction is mature, most every company that is going to show up in some industries has already showed up, and so you have to get all the moving parts right. Back in the old days, you could listen to someone at Google give you best practices like "don't use a call to action," "you must use a call to action," "capitalize the first letter of every word in your ad," and other warmed-over, highly inadequate snippets of advice.In reality, paid search isn't a game of gimmicks. High bids, low bids -- neither are magical. Landing page testing is for conversion improvement -- not to magically improve your quality score.How do you cut through the sea of bad advice if you're new or just returning to the space? Short of reading a 400-page book, I hope that this 40-page ebook, Google AdWords - A Brave New World - I released a few months ago is still helpful to folks getting their feet wet, not wanting recycled advic[...]

Why I Won't Invest in Avid Life Media


Jason Calacanis, the notorious web entrepreneur of Weblogs, Inc., and Mahalo fame, recently raised a flap by telling everyone to boycott comScore and indeed, to sell or short-sell its stock. I'm glad I came to my senses and decided not to get caught up in that catfight, though I sometimes have questions about the accuracy of comScore's numbers (which is the real point needing more sophisticated debate, but also more transparency on comScore's part).Observers have been quick to distance themselves from Calacanis, but in fact this underscores an important point: bloggers, journalists, and company owners in the space are afraid to agree with Jason because they perceive some kind of threat of being ostracized or singled out in some way.Watering down the fervor just slightly, I won't tell you what to do, but I'll tell you why I won't invest in the following growing Canadian digital media company when it goes public.Avid Life Media, the notorious owner of infidelity dating website, is looking to raise $60 million through an initial public offering on the Toronto Stock Exchange.As much as many investors and underwriters will have turned up their nose at the share offering for moral or optical reasons, what it really comes down to is that you're buying into the people who run a company, and their attitude towards risk. You're also trying to gauge their likelihood of telling the truth, the whole truth, about the business and how it operates -- now, and in future years.That's why I noticed the part of the story that states that part of the deal would involve a merger with Moxy Media, "an online advertising sales company based in Guelph, Ontario." Moxy Media is made to sound pretty big: $192 million in revenues in 2009, dwarfing Avid's $30 million.The combined company plans to go public using the RTO method, finding a shell company already traded on the exchange.Moxy Media's predecessor, TrueLocal, is legendary in the industry for making a lot of short-term money on something called "click arbitrage". Hint: what you found at the home page of TrueLocal had nothing to do with TrueLocal's actual business. Like their successor, the new, improved, Moxy Media, TrueLocal had a network of 300 websites (or actually, more like 3,000) "each providing consumers with information and access to products and services," as the Moxy Media site states. Meaning: TrueLocal built topical pages of (largely Yahoo driven) paid links, sending inexpensive Google AdWords clicks to pages that were well-engineered to create a high proportion of clicks on ads. Those ads would eventually get a user to a paying advertiser's website; vendors like fireplace manufacturers and bridal gown retailers would be typical targets.For years, Google's top management has been against these "click arbitrageurs," because the user is being deceived and ultimately winds up dissatisfied with the extra clicks it takes just to find a vendor. All the extra clicking created revenue for Google, Yahoo, and TrueLocal alike, but at the price of dissatisfied users and dissatisfied Yahoo advertisers (at least, those who twigged to the problem).In addition to that, arbitrageurs, like many affiliates, are "lowballers" in the Google AdWords system. They only wish to advertise if they can get a click for a very cheap price. Google's landing page and website quality guidelines were designed almost entirely to scrub such advertisers from the system, especially in the most mature market (the United States). While lurking in the sub-30-cents click arena, the arbs & affi[...]

AdSense Revenue Share: 72% for partners, 28% for Google


Google's impressive Q4 2009 earnings report makes certain aspects of the business clear for all to see. For example, they report that revenues of $2.07 billion in revenue was generated by "Google partner sites through its AdSense program," and that "amounts ultimately paid to our AdSense partners" totaled "$1.47 billion in the fourth quarter of 2009".

Misleadingly, the report states that "TAC (traffic acquisition costs) as a percentage of advertising revenues" is 27%. True, but as a percentage of same-channel advertising revenues, it's 72%. There are virtually zero TAC's for "Google-owned sites."

Speaking of those Google-owned sites, they generated $4.42 billion, or 66% of Google's revenues.

In these numbers is the usual picture of impressive strength -- including the fact that the overall number of paid clicks rose 13% YOY (indicating continued success in optimizing page layouts while satisfying users) while click prices rose just above the rate of inflation, at 5% (indicating a leveling-off). But coupled with that strength is the interesting point that financially speaking, Google continues to provide only the illusion of a diversified company. It continues to do well, very well, based on its core cash cow. Elsewhere, it serves as a relatively polite intermediary that continues to face downward margin pressures.

The growth picture is an interesting mix: heavy investment in new areas like mobile (a longer road to profitability), and a relatively smooth path to continued growth simply by enjoying the great upside that remains in international markets in its core strength.

Which, in case anyone has forgotten, features the catchy advertising product: "Google AdWords."

The financial picture for GOOG remains very bright, but mainly because its core strength has such high margins, and Google (needless to say) owns the key "publication" (Google Search) outright.

Attention SES Toronto Alumni


Hey there! If you've attended SES Toronto in the past, you should have received an email offering a deep discount off the price of a pass to this, the world's best Canadian search engine marketing trade show coming up June 9-11, 2010. This early bird discount is so great, it doesn't make sense for you or your company to pay the higher rate.

The offer expires Feb. 1. If you didn't receive the email, ping me and I'll try to hook you up with the Right People.

Incredibly Specific: A Trend for 2010 (Like Never Before)


I just paid $100 for an extremely targeted information package, written and recorded by an affiliate marketer, about a very specific element of Google AdWords advertising (hint: it's in the content network).I've seen this working already in practice, and I figure his tips will mean a lot more than $100 to my business, so I bought it right away."My business" isn't an affiliate marketing business. It's for clients. Even better. They have bigger budgets.Let's be clear: he promises that for most affiliate marketers (especially clueless ones), this technique could add up to peanuts. Many campaigns will try as best as they can and spend only $5/day.So I paid $100 for it?Yep, because I understand the value. I know it's valuable info.The other curious thing is I rejected all the add-ons, freebies, and accoutrements that could have come with it. I didn't want to accidentally sign up for something that turned into a renewing contract, and besides, I didn't want to get distracted from the core information I wanted.Here's what impresses me. Legions of would-be experts and helpful souls will offer up mounds of information this year in an extremely helpful, and free, fashion. Doesn't info want to be free?And yet this relatively unknown affiliate marketer, proverbially working from his basement... should clear about $75,000 this month from this information product. It may not have huge legs, but it got the job done for him, income-wise. And the value is real. Many really good authors will earn less than that this year, needless to say.So what impresses me is not that you can make more from specific information, but *how* specific the information is. This product covers a *tiny* sliver of the marketing universe. No one will grade the author on how well he grasps marketing as a whole. Not even how well he grasps AdWords as a whole. Just whether he taught one specific technique in decent enough detail so you can try it: $100.Will his "loophole" close? Maybe. But in this game, if you can't squeeze $100 out of something before the loophole closes, you gratefully accept the chump label and move on.I learned the lesson along ago: when I burped out the Google AdWords Handbook in 2002 it was a semi afterthought after 18 failed months attempting to put together a magnum opus on SEO best practices (or something like that). It did great.In 2004, while I was writing the first edition of a more serious grown-up book on Google AdWords with a big publisher, several times I got panic calls from the publisher. They'd read one of those negative stories about Google's business, and they figured that AdWords was a flash in the pan. This continued through 2005! Really! I'd have to reassure them that they were seeing some very odd (if seemingly respectable) journalism. And that Google's advertising program was not too small to go to press with.What's stunning to me (but it should not have been) is that a book on Google AdWords is almost too broad today. There's room for books that cover a broad topic. But they don't get people to whip out their credit cards to pay $100 online, do they? Odd paradox. Less is more.I don't have any New Year's resolutions on the books, but if I did, I bet it would be to try to go to market with an incredibly specific piece of information. And, for a change, screw "free." In Chris Anderson's book, he actually reminds us that the real quote was something like "commodity information wants to be free, and scarce information wants to be expensiv[...]

Introducing My New ClickZ Column: Paid Search Strategies


After enjoying nearly three years writing monthly columns in the paid search channel at Search Engine Land, starting tomorrow (Friday), I'll be writing a column every other week at ClickZ.For Search Engine Land I wrote 37 columns, starting with one about paid search "slaying dragons and back-checking" and getting little respect in return. In open forums no one wants to discuss the unsexy channel - they just quietly do it in real life, because the digital economy basically revolves around it. Beginners will still mis-prioritize efforts and risk wrecking their companies by installing costly Meatball Sundaes.Whether it be at Search Engine Land or ClickZ, or at conferences and seminars, whether it be in discussions of tactics or high level budget strategy conversations, my goal remains: dissuading companies from installing those costly Meatball Sundaes to the exclusion of making performance marketing work for their bottom line. There is nothing wrong with spending heavily on "the basics". "The basics" also don't "just work" for just anyone. They aren't "tried and true" unless you try and try and try, and make them true. There is nothing turnkey about paid search and related basics.To many digital marketers, neither Search Engine Land nor ClickZ need any introduction.The latter, ClickZ, was founded in 1997 by Andy Bourland and has channels for every aspect of digital marketing. Increasingly, under the rejuvenated stewardship of Incisive Media, it is the flagship brand for content about digital marketing and strategy. It's also finding its way out onto the conference circuit, underscoring the importance of integrated digital strategies moving forward.Search Engine Land, the "upstart" search marketing publication, was founded under the rubric of Third Door Media by Danny Sullivan and partners about three years ago, and has done phenomenally well ever since that time. Danny Sullivan is of course no upstart in that he, for all intents and purposes, launched the whole idea of tailored conferences and trade publications in the search marketing industry back around the same time ClickZ was getting founded. If you have to look up who Danny Sullivan is, that must mean you're new to the business. Tip: Danny is not a race car driver.I'm excited to join the ClickZ team. Friends and colleagues I respect have been writing there for many years, some nearly since inception -- Bryan Eisenberg being a shining example. Debbie Weil is one friend I recall writing some pioneering stuff on ClickZ. A column called "to blog or not to blog" was written in 2001! I'm not sure how some of the current crop of experts get away with recycling Debbie's material :).As the focus of ClickZ leans towards the agency and bigger-company crowd, I'll try to move in a slightly more strategic direction. The column, appropriately, will be called Paid Search Strategies.My Page Zero Media colleague, Mona Elesseily, is still going strong at Search Engine Land in the paid search channel. I'm pleased to note also that Matt Van Wagner, a good friend, has joined the SEL columnist roster to add his experience to the paid search channel. ----- Download a FREE E-Book by Andrew Goodman: Google AdWords: A Brave New World Are you new to search marketing and looking to come up to speed quickly to Google AdWords? Or maybe you’ve just fallen a tiny bit behind, and you’re looking to re-engage with the latest thinking. If so, Andrew's free e-book is for you.[...]

Google Considers Pulling Out of China Four Years After Grand Entrance


Google is reporting through its Chief Legal Officer David Drummond that it's ending the censored version of its site in China, and considering pulling out of the country.

This is a gripping development.

Google's so big, they almost face the same dilemmas as a country trying to trade with China -- almost.

Summing up, purists argued that Google shouldn't go in in the first place, and certainly in our response in January 2006, we felt Google was being naive, but agreed that there was complexity in trying to initiate political change by being open to a partner that was far from perfect. We added that if it didn't pan out, they could leave. We figured they could set a time limit, then leave if the human rights situation didn't improve.

Six months after that, Sergey Brin was already expressing misgivings, and no doubt the company has been thinking about the relationship ever since.

Although the current shift in policy seems to be triggered by episodes of Chinese government hacking and espionage to spy on human rights advocates, no one episode need to explain the desire to pull out; certainly it doesn't seem like this is the only issue at hand.

Indeed, the US government has been alarmed at widespread security breaches of the Pentagon and other federal institutions dating back to at least 2007, clearly traceable to China. The early denials by China have given way to regular confirmations from well-placed security experts.

Google, as a private company, turns out to have the luxury of pulling out of a country if it doesn't like their policies. They can even chalk it up to "regulations" that make it "hard to do business," if they wish.

So, Google isn't a nation-state just yet. While there will be forgone revenue, the repercussions are likely to be relatively mild, and Google answers to its shareholders, stakeholders, and customers.