Author Archives: ghotchkiss

A Battle Plan for MSN Search: Innovation and Integration, not Inundation

First published March 17, 2005 in Mediapost’s Search Insider

We know Microsoft wants to win the search battle. Bill Gates has gone on record repeatedly and publicly saying his biggest business regret is not having recognized the importance of Internet search soon enough (this would be the same Bill Gates who said the Internet would never amount to much). And during the Super Bowl, an ad for MSN Search invited millions to try the new, more precise, more powerful search engine.

Rumor has it that Microsoft has a gargantuan battle chest set aside for further advertising. The intention is clear. We will keep being hammered by MSN Search ads until we give in and give up on Google.

But at the Search Engine Strategies Conference in New York, Jupiter Media Analyst Gary Stein reminded us of something. Google got to where they are with a total ad budget of… $0. They just built a better search engine.

I think the future success of MSN lies not in showcase television ads, but in giving us a reason to switch.

Google Is Not Invincible It sometimes appears that Google has a stranglehold on search. Take a room full of people pretty much anywhere on the planet and it’s a safe bet that most of them will be Google users. But recent research has shown that there may be a few stress fractures showing in our love affair with Google. I don’t think it’s because Google has done anything overtly to cause us to look elsewhere. It’s just that they don’t have the clear performance advantage they once did.

Again, Gary Stein had an excellent point. There’s no significant user pain involved in switching search engines. You don’t have to reinstall software, reformat files, or change computers. One day you’re using Google, and the next, MSN. It’s that easy. In fact, you can switch search engines in the middle of a task. Millions of people do it every day. Google’s brand equity can disappear in the time it takes to click a mouse.

Putting Search One Click Away In any type of measurement of search engine market share, there emerges an interesting contradiction that speaks of another vulnerable area for Google. If you do a survey and ask people what their preferred search engine is, my bet is that at least 75 percent or more will say Google. In the last survey we did with 1,600 participants, the number was almost 83 percent. Yet, when you look at Nielsen or comScore’s market share numbers, Google ends up with somewhere between 35 and 45 percent of the market. So, if three out of four people prefer Google, why don’t they own a proportionate share of searches?

The reason is that we’re basically lazy. If we’re on MSN and a search box is handy, we won’t bother going to Google. This is one reason why the battle of the search toolbar heated up so quickly. It also points out the precariousness of Google’s position. Yes, we love Google, but ask us to spend another three to four seconds to type in the URL and we’ll head off with the first search opportunity that catches our eye. Online, brand love is a very fickle thing.

It’s Time to Raise the Bar, Again What we really want is a better way to search. Something that gets us just the destination and information we want, quickly, seamlessly, and, while you’re at it, it wouldn’t hurt to wow us with some new innovation as well. I think we’re on the threshold of another breakthrough. It’s time for a giant leap forward in search. There are a number of startups that are knocking on the door, but we’re waiting for a search site with enough market traction to really up the ante with search.

The blizzard of incremental improvements we’ve seen coming out of the major players is nice, but the market advantage they give only lasts for a week or two and then the competition evens the playing field again. Somebody has to stake the high ground and keep it for more than a few days.

The Secret? Search at the OS Level I believe the functionality to make this quantum leap forward in search has to rest at the operating system level. Search needs to be more fully integrated into our daily online activities. It needs to achieve the transparency that can only happen when search works in the background, totally integrated with programs and the basic functionality of our computer.

This is where MSN Search can deliver the knockout punch to Google. And I believe Google knows this. I’m guessing a fair number of the hundreds of Google PhD’s are wrapping their collective intellect around this blockbuster challenge. Google has to gain a foothold on the desktop to effectively fight off Microsoft’s attack. And this means surrendering privacy. Privacy is something we are protecting more and more diligently. We won’t give it up easily.

But Microsoft has already integrated themselves at the root level on our desktop. They don’t just own the high ground, they own the whole landscape. And when they can deliver a search experience that’s truly better than the competition, they’ll have already won. It won’t take another Super Bowl ad.

Microsoft, you had us at hello.

Online is Not the Place for the Road Less Travelled

First published Feb 17, 2005 in Mediapost’s Search Insider

We are all creatures of habit. We travel in well-worn grooves, interacting with the familiar and generally eschewing the unfamiliar. Of course, not all people are alike, but generally speaking, we as a species don’t like breaking new ground. Occasionally we will nudge ourselves out of our rut to try something new, but pretty big win had better be in store for us.

In the early days of the Internet, everything was new. Every visit online was forging new horizons. We made new discoveries daily. We had no choice. If we chose to go online, we were forced to venture into the unfamiliar. While this is still true to a certain extent, those days are rapidly disappearing.

We are civilizing and settling the online world. We’re staking out the familiar territory. We’re finding and bookmarking our favorite destinations. And suddenly, there is a value assessed to well-traveled online properties. Brand loyalty builds.

Search as our navigator This is nothing revelatory or earthshaking, but it does have some direct implications for search marketing. There is a sweet spot for search, and it has to do with the size, scope, and nature of our identified and familiar online world. Whenever we have to venture into the terra incognito that lies beyond those boundaries, we turn to a search engine.

And, because we are creatures of habit, we turn to our favorite search engine. We trust that engine to quickly identify new sites that we feel comfortable exploring. Search acts as a navigator and guide. And generally, we only go to search when a familiar destination doesn’t immediately spring to mind.

So, in a consumer interaction, there are distinct phases where we are likely to turn to a general search engine like Yahoo! or Google. If we are booking a trip, most of us will go directly to Expedia or Travelocity. That’s familiar ground to us and we know that it will deliver what we’re looking for: a quick way to compare a number of different airfares, hotels, or other options.

We don’t go to Google each time and search for the lowest airfare to our destination or a hotel. We don’t need a navigator, because we already know the way. There are sites we know of that are better able to find the information we’re looking for, because they were built for that specific type of search.

Stepping into the unknown But let’s say we want to do consumer research in an area where we don’t have a reference and comparison site such as Expedia. For example, let’s say we’re looking for a new mountain bike. We may be familiar with a brand or two, but we’re looking to broaden our options for consideration. So, we turn to a general search engine to help quickly identify new landmarks to help navigate this unfamiliar territory.

As soon as we can, we try to find vertical reference sites in the market we’re researching, because we know they’re built to provide richer content and more searching functionality for that particular product than a general, one-size-fits-all search engine. We use the navigator to find the reference landmark.

Why so many consumers use generic keyphrases Often there is back and forth between the two. In the case of the mountain bike, perhaps the vertical reference site allows us to find new models, which we then turn to our favorite search engine to find more information on. This may or may not happen and it’s one reason why the comScore study released in December found that many consumer searches on general search engines never progressed beyond generic key phrases.

Another example we saw of this behavior became apparent in a focus group we conducted early in 2004. In it, we gave 24 participants a budget to spend and asked them to start researching their purchases online. About half the group wanted to purchase a consumer electronic (CE) item and either the first or second place they went was the site of a very well known CE retailer. They did the majority of their research there and only occasionally turned to a search engine to broaden the options or look for new online destinations.

Exploring our target consumer’s online market landscape As search marketers, we need to spend more time understanding the territory that our target consumers travel through. If we’re trying to intercept them, we need to know their online destinations, both familiar and unfamiliar.

We must know when they’re likely to turn to a search engine and when they might go directly to a site they’re already familiar with. The fastest way to find the intercept point is to examine the traffic patterns and then decide where you can stake a presence in a prime intersection. But all too often, we try to stake our claim to online territory, never knowing if our customer might even come that way.

Rashtchy’s Golden Search turns Platinum

First published on Feb 3, 2005 in Mediapost’s Search Insider

On November 9, 2004, Piper Jaffray analyst Safa Rashtchy dropped a bombshell on a small handful of people at the New York Ad:Tech show. He doubled his search revenue projections for the next five years. And, he bumped these projections less than two years after they originally came out.

Back then, Rashtchy’s $7 billion by 2007 revenue projection was quoted everywhere. You couldn’t turn around without seeing a reference to these amazing growth predictions. And now, he nonchalantly walked up to the podium and said search revenue in 2007 will be more like $13.5 billion! I was sitting in the audience and my jaw dropped.

But a strange thing happened this time. Nobody seemed to care. In preparing for this column, I scoured the Internet for any mention of Rashtchy’s exciting announcement. I found nothing. While it’s not surprising that the announcement missed the mainstream press, I can’t believe our own industry didn’t pick up on it. I finally had to resort to contacting Rashtchy’s team and getting a copy of his presentation.

In the process, I asked Rashtchy why the announcement didn’t seem to gain attention. His response indicates that the lack of attention means search is now accepted with more credibility: “I think search is now accepted as a big business. You have a $60 billion company on the market doing only search, so people are saying that with these valuations, we expect that you will up your estimates significantly.”

Sorry Rashtchy, Better Late than Never…. I think the readers of this column would be well served to get the high points of Rashtchy’s announcement, so let me share them with you.

First of all, the growth numbers. In March 2003, Rashtchy estimated that worldwide search revenues would hit $7 billion by 2007. Just a few months later he was quoted as saying that these numbers are likely too conservative. With last November’s presentation, he had the opportunity to bump those numbers up.

Rashtchy now feels we’ll not only hit that target, but surpass the 2007 – $7 billion mark this year. Next year, he predicts search revenues to top $10 billion, and then hit $13.5 billion in 2007, $16.2 billion in 2008, $19.8 billion in 2009 and top $23 billion in 2010.

Factors of Growth Rashtchy feels there are a number of revenue drivers fueling the growth: • The increasing use of search by big business

  • A second wave of small business just discovering search
  • The international growth of search
  • Discovery of the branding value of search
  • The growth of contextual search, with local search perhaps poised to take over

 

In addition, he sees four immediate and fundamental drivers of search growth. He collectively refers to them as T.C.P.C.

Traffic – More people doing more searches, especially commercial searches Coverage – Expansion of keyword baskets, monetizing more search terms Price – Increasing prices per click Conversion – As we get better at converting clicks to buyers, advertisers are willing to bid more

Local Search Rashtchy feels that local search could become a significant driver of new search revenue. I know there are mixed opinions about this (I for one agree with Rashtchy on this one and have said so in previous columns), but I think the salient point here is that local search, if successful, dramatically increases the market size for Google and Overture.

It takes search from a global consumer activity and brings it back home. It ties the Internet much closer to our day-to-day shopping activities. It will take a few years for local search to make much of a difference in overall search revenues, but once felt, the impact will be significant.

Search Efficiency – It Still Can’t be Beat In comparing methods for customer acquisition, search still comes out far ahead. Piper Jaffray estimates the average customer acquisition cost for search to be between $7 and $10, compared to $15 and $25 for Yellow Pages, $40 to 80 for e-mail and $60 to 80 for direct mail. Search is growing because it works.

Bottom Line Rashtchy summed up with five conclusions that state the future potential of search in no uncertain terms: – Search is likely to become the most successful marketing method for all businesses

  • Local search is a huge force that could change the dynamics of search for online-only merchants, putting them at a big disadvantage
  • Concepts like broad match could make search an effective soft sell, suggestive advertising mechanism
  • Merchants should focus on customer conversion and extending the customer life cycles
  • Search providers should focus more on merchant conversion rates and offer lower charges for broad match and contextual search. They should also focus heavily on local and international expansion.

 

The 70/30 Rule of Search

First published on Jan 20, 2005 in Mediapost’s Search Insider

In nature, there are the Fibonacci numbers. This sequence (0,1,1,2,3,5,8,13…) and the Golden ratio (Phi or 1.618034) derived from it, occur with amazing frequency and can be found in flowers, the shells of mollusks, leaf arrangements, and even the proportions of the human body. I’m beginning to believe that search marketing has its own naturally reoccurring ratio, and I’ve dubbed it the 70/30 Rule.

I can’t help thinking that many of us are missing the boat when it comes to search marketing. Perhaps not the whole boat, but 70 percent of it. Every day, new research is coming out which points to there being a vast, untapped potential in search. We’ve picked the low hanging fruit, but there’s a whole tree full of rich marketing results that we have to reach a little further for. And when analysts like Safa Rashtchy and the gang at JupiterMedia point to doubling, tripling, and quadrupling revenues from search over the next five years, it’s based on assumptions that marketers will figure out ways to better tap into the full potential of search.

As I write, I know there’s a posse of irate search marketers who are whispering, “How dare he refute our expertise in this area! Low hanging fruit, indeed. The nerve!” As back up to my observation, here are just three examples that come to mind of where the 70/30 rule seems to apply.

Seventy percent organic 30 percent sponsored A little while back I was presenting a session at Search Engine Strategies about balancing organic and paid search strategies. I had a typical search results page from Google up on the screen. I asked the audience which section of the page they normally look at first. Almost every hand in the audience went up when I got to the top organic results. This was no great surprise. From our research into search user behavior, I was pretty sure this would be the case.

Then I asked who in the audience dedicated at least 30 percent of their search marketing budget to organic optimization. Very few hands went up, probably less than 3 percent of the audience.

Does anybody else see the disconnect here? This is not a new message. Study after study has shown that about 70 percent of all search engine clicks happen on the organic results. Yet sponsored search continues to take the spotlight and the lion’s share of the budget, while for many, organic optimization seems stuck as a little understood and even less trusted tactic only fully utilized by online casinos and porn merchants.

Companies using search have to understand their consumers are going to look and click on organic listings more often than sponsored, and you can’t just ignore the fact. Yes it’s harder, yes it’s not guaranteed, and yes it may require some changes to your site, but 7 out of 10 people can’t be wrong!

Seventy percent researchers 30 percent purchasers When is a consumer likely to use a search engine? When they’re ready to buy? No! It’s when they’re researching the buy. And most likely, they’re very high in the consideration phase, just checking out the competitive landscape. This varies with the type of purchase, but usually the search sweet spot is for a product where there is little familiarity, where there is a significant amount of consumer research and consideration, and where there is a lead time of a month or two before the purchase. This is not true all the time, but it is true about… well, look at that… 70 percent of the time!

Driving consumers to a hard purchase conversion and leaving them without another option is not going to be a successful online tactic for the majority of your consumers. We have to understand the mindset of the consumer when they’re likely to use a search engine. If you always aim for the easy conversion, or the low hanging fruit, you’re probably missing 70 percent or more of your market. Take some time to gain a better understanding of the consumer and what they’re looking for. Adjust your search marketing strategies accordingly. Extend your reach beyond the low hanging fruit.

Seventy percent by luck, 30 percent by design Recently, JupiterMedia released findings of an extensive survey with search marketers. In it, they found that only about 25 percent (close enough to 30 for me) of the respondents actively used landing pages and other on-site tactics to increase conversion rates.

The majority of a search marketer’s time is spent in trying to influence position on the search engine results page. This is true whether you’re working on the sponsored side or the organic one. As marketers try to squeeze more return from their marketing investment, there are three points at which they can influence the ROI equation.

They can reduce the investment by intensive bid management or tapping into the organic potential of search. They can increase impressions and click-throughs by extending the keyword basket or improving their position on the page. And finally, they can increase the conversion rate on the site by making sure the search visitor finds what they were looking for and that an appropriate conversion path is present.

It’s the last of these three that offers the marketer the greatest degree of control, yet it’s the one most often overlooked. Usually, we have complete control over what happens on our own site. But often, we have never really asked our visitors what they’re looking for. We haven’t tapped into the existing (and extensive) body of knowledge on usability design when it comes to Web sites. This is one area that could have huge payoff not just in search, but also in all areas of online marketing.

Fibonacci redux For each of the three examples of the 70/30 Rule I’ve given, I know others exist. And I’m not sure that it’s wrong that marketers have previously gone for the obvious wins in search. But I worry about the lack of motivation to go after the wins that require more work.

We can’t move forward as an industry until we start doing the research required to better understand the 70 percent of the market we’re missing. The big winners in business have never been the companies that go for the easy wins. They’re the ones that figure out how to pick the fruit that’s just out of their competition’s reach.

Black vs White: SEM Soul Searching

First published on Jan 6, 2005 in Mediapost’s Search Insider

At the recent Search Engine Strategies conference in Chicago, there was a new addition to the session list: Black Versus White, And Lots of Gray! Danny Sullivan wanted to stage a showdown between known black hat SEO’s and those that have chosen to tread the purer path. Holding down the dark side was Todd Friesen and Greg Boser. The champions of the straight and narrow were Alan Perkins and Jill Whelan. Falling into the great gray in between was Mikkel deMib Svendson.

The Lighter Side of the Dark Side

The session had a somewhat tongue in cheek tone, but nevertheless, some serious issues that lie at the heart of organic search optimization were explored. Alan Perkins began to tackle the thorny issue of whether black hat SEO was even legal.

His reasoning was that manipulation of factors to increase rank for obviously commercial pages of questionable relevancy was in fact misleading presentation of advertising messages. There’s also the issue of whether hiding or presenting content specifically for search engines falls offside of the recently enacted accessibility legislation.

Todd and Greg countered with a plea for all search engine optimizers to come clean and admit we all manipulate search results (Greg believes SEM should stand for search engine manipulation); it’s just that some of us are more effective at it than others. They use tactics of varying degrees of aggressiveness, and only use the extreme black hat tactics in industries where it’s an absolute necessity to compete, such as online pharmaceuticals and gambling.

Greg made the excellent point that the most serious breach of ethics he’s run across in SEO are those companies that use black hat tactics but don’t disclose the fact to their clients. He insists on full and total approval of tactics by the client.

Was Sun Tzu a Black Hat?

Mikkel likened search marketing to warfare, citing Jay Conrad Levinson’s guerrilla approach, and said that you have to do whatever you have to do to win. Greg agreed, calling it a “full frontal assault” on the search engines. Alan Perkins found the warfare analogy unfortunate and distasteful, saying he didn’t believe that search marketing should be compared to war, because there are no winners in war.

As could be predicted going into such a heated topic, no one changed their minds, but I think we discovered a few more shades of gray between the two extremes. I suspect that was Danny’s intention in putting the session on the agenda. Somewhere between the blinding white of Alan’s world and the dark practicality of Todd and Greg’s, the real world of SEO exists. And as long as people continue to look for organic results, that world will continue to be colored in various shades of gray.

In fact, there is a somewhat symbiotic relationship between the two extremes in our industry. Many reputable companies that steer well clear of questionable practices look with fascination on the tactics employed by the true black hats. One cannot help but admire the sheer brilliance of the methodical attack on the algorithms of the search engines. And in those tactics, they hope to pick up the kernel of a strategy that can be pulled back and employed in a less aggressive manner for their clients. Even the search engines routinely plant informants at the shows at which the black hats tend to congregate to pick up intelligence on the latest tactics.

In the “Wish I Said” Category…

So, at the end of the day, there were no easy answers. But there were a couple of points made in my follow up conversations that I wish had come up in the session. One of the best points was made by my friend Greg Jarboe of SEO-PR.

The fact is that black hats will aggressively look for any hole, and they will attack that hole with everything at their disposal. This means that legitimate ways to gain search visibility are soon exploited by the black hats, forcing search engines in many cases to close down legitimate and useful opportunities for both users and advertisers.

We know that search marketing is a real estate game, and there’s nothing wrong with aggressively looking for new opportunities to gain territory on the page by exploring new strategies including shopping feeds and news engines. That’s just smart search marketing. But the line is crossed when the black hats aggressively subvert the rules and use those new channels to artificially build links or boost their visibility at the expense of the user experience.

And that brings me to my final point. I believe there is a place for guerrilla marketing, but I think Mikkel, Greg, and Todd missed an important point in using the all-out war analogy. Levinson’s intention was that the casualty would be the competition. When you attack the search engines, the casualties are numbered amongst the users of that engine. And those users are your target consumer. I somehow doubt that Mr. Levinson ever wanted you to launch a war on your customer.

Of Serendipity and Search Engines

First published in Mediapost’s Search Insider on Dec 13, 2004

I love the word serendipity. It’s like an entire poem in one word. Just saying it out loud makes you feel… well… serendipitous.

So, this week, with the holidays approaching, I was in a serendipitous mood and started noodling (another favorite word) with my Google toolbar. “Hmm” I said to myself, “I wonder how Google ranks on Google for the words “search engine.” Google’s whole promise is to bring the best to the top, right? So which search engine is Google giving its all-powerful vote of confidence?

Well, no one, as it turns out. SearchEngineWatch.com, Jupiter’s portal for search marketing and optimization, grabs the coveted top spot. So, surely, Google must be second. Nope, that would be Lycos. Now, as far as I can remember, Lycos is dying a long and lingering death, but according to Google, they’re No. 1. Well, actually No. 2, behind the site that isn’t a search engine.

In fact, Google ranks itself fifth, behind Dogpile and AltaVista. Can it be? Does Google have a secret inferiority complex? Is the cockiness of every Google employee I’ve ever met just a front for a shuddering mass of vulnerability? I dig further.

What if I refine my search? Let’s try “smartest search engine”. Oops, no search engine I recognize makes it to the top 10.

Okay, how about “best search engine”? Again, there aren’t too many familiar names in the top 10, although Dogpile does manage to sneak in at No. 8.

I’m getting desperate now, and serendipity is hanging by a thread, in mortal danger of giving way to unhealthy obsession. I type in “Larry and Sergei’s search engine,” figuring it’s time to get really specific. The strategy is lost on Google, which again serves up a list of unfamiliar sites, with the exception of Go.com in the No. 10 spot. Well, at least the first two letters are right.

One last stab in the dark: “Search engine with recent IPO that’s aiming for world domination.” Nada.

Maybe I’m using the wrong engine. I switch to Yahoo! And sure enough, there’s no identity crisis here. Yahoo! proudly ranks itself No. 1 for “search engine” and in a concession to the competition, throws the No. 2 spot to Google. Apparently, Yahoo! thinks more of Google than Google thinks of itself.

Let’s take Microsoft’s new algorithm for a spin. Again, MSN thinks a lot of SearchEngineWatch and gives them the top spot. And guess who gets No. 2? Google. Looking down the page, I see Search.com, AltaVista, Dogpile, Lycos, Northern Light (are they still around?), Webcrawler, and… no MSN. Didn’t even break the top 10. Well, maybe they haven’t gotten around to spidering themselves yet.

It’s time to Ask Jeeves. First, I had to scroll down past a zillion sponsored ads that pushed the real results off the page. And when I finally got to the results, they did a pretty good job of nailing the top engines. Like Yahoo!, Jeeves doesn’t mind blowing his own horn. Ask Jeeves is No. 1, Teoma (owned by Jeeves) is second, AltaVista third, Lycos fourth, AlltheWeb fifth, and Google comes in a distant sixth. Webcrawler, Dogpile, Yahoo!, and Excite round out the top 10.

All relevant, and all search engines, although the one-two finish of Ask.com properties smacks of a little judicious human intervention. Seems that Jeeves might know his stuff, even if he is a little egocentric. Google thinks Lycos is a search engine powerhouse, so how does Lycos feel about itself?

Well, Lycos apparently has no idea what a search engine actually is, because the only two search engines to break the top 10 are Overture and AOL. HotJobs is No. 1 and an eBay page for Thomas the Tank Engine is firmly embedded in the No. 3 spot. At least the HotJobs link might come in handy for the engineers currently working on the Lycos search algorithms.

There seems to be a building ground swell for AltaVista. Could this be a dark horse? I went to Yahoo!-owned AltaVista and found out that once again, the portal SearchEngineWatch takes the top spot. Is it coincidence that a portal for search engine optimization consistently takes the top spot, beating the engines at their own game? It’s deliciously ironic, if you ask me.

The irony continues with the fact that Google takes the No. 2 spot on the competitor’s engine, with hometown favorite AltaVista in No. 4, Yahoo in No. 5 and Dogpile in No. 6.

Survey Says…

And so, in a serendipitous, non-scientific poll, using GordRank, a sophisticated algorithm of my own invention, here are the top search engines, as ranked by the search engines themselves

1. Google (ranked higher by almost all the competitors than Google ranked themselves)
2. AltaVista
3. Yahoo!
4. Dogpile (yes, Dogpile)
5. Lycos
6. Teoma
7. All the Web
8. Webcrawler
9. Hotbot
10. Metacrawler

There are a couple of points that have to be said. Perhaps Larry and Sergei could hire a search optimization firm to help them rank better on Google. I know they have the money and it seems to be a challenge for them.

And despite Bill Gate’s bravado and bank account, no one seems to know that Microsoft has a search engine. Not even MSN!

Til next year, Happy Holidays!

Is Search in a Rut?

At the fall Ad:Tech in New York, there was an abundance of search on the session list. There were search sessions on selecting an agency, selecting search terms, understanding the search consumer (which I participated in), paid search campaign optimization, organic search, local search and even some performance art lampooning search. After the nearly total absence of search from the spring Ad:Tech show, it was a great rebound.

Or was it?

The sessions were hardly standing room only. In many, there were more empty seats than full ones. A sadly defining moment was when Piper Jaffray analyst Safa Rashtchy raised his expected revenue for search in 2007 by almost 10 billion dollars. This should be huge news. Those of us in the industry did a double take. But the announcement echoed hollowly through an almost empty room. Apparently, the marketing industry didn’t really care.

In a quick conversation with organizers of the show, they expressed frustration at the lack of interest in search. As an industry we had lobbied hard to have a presence at the New York show, and Ad:Tech accommodated. They filled the roster with 9 different sessions that touched on search. But other topic areas drew much bigger crowds.

You Can Dress Search Up, But You Can’t Take Her Out.

I hate to point this out, but search just isn’t sexy. It’s the marketing you have to do, not the marketing you want to do. For those of us that are passionate about search, this is hard to understand. “What do you mean you don’t find my girlfriend attractive? ”

Perhaps the problem is that we tend to be a little myopic in our view. We’re immersed in the day-to-day detail. We can actually get excited about algorithmic changes and new file types being indexed. This is hardly the stuff of great cocktail conversations. There are not many 20-something-year-old marketers who would use their knowledge of dynamic URL rewriting as a pick up tactic at the post-show networking party.

An Hour to Learn, a Lifetime to Master

The other problem is that search is like golf. It’s not that hard to do it halfway right and get results. Grasping the basic concepts is pretty easy, at least on the sponsored side. Most marketers think they’ve got search nailed and there’s nothing more to learn.

But like golf, there’s a whole other dimension to search that almost no one has scratched, and it’s incredibly hard to master. Very few companies have an effective search strategy that spans both organic and sponsored channels. Even fewer have tapped into what I call the missing 40 percent of search strategies, truly understanding the mindset of the search consumer and effectively starting a relationship with them.

The other frustration in trying to paint a more enticing picture of search is that the truly intriguing developments are happening in the research labs of Google, Microsoft, and Yahoo! It would be fascinating to get these engineers to open up about where they want to take search, but no one is talking. They can’t, because the balance of power in a multi-billion dollar turf war is at stake.

Looking From the Outside In?

Perhaps the answer for Ad:Tech is to look at search from the outside in, rather than the inside out. More and more people from outside search are looking in and trying to understand how they can leverage this extremely effective marketing channel. “We know people use search, so let’s figure out how we can use that to our advantage.”

I know of brand strategists, academics, market research consultants, and consumer behavior experts that are starting to pay attention to the search phenomenon. They’re bringing fresh insights and approaching search from a much more strategic perspective. This outside interest is also indicative of the disappearing distinctions between search and other online ad delivery channels.

As you know, the lack of strategic thought in search is one of my greatest frustrations with our industry. Quit talking about A/B testing, bid gaps, and link building! Tell me about how, when, and why my target consumer will use search. Tell me how to effectively capture that consumer in a prospect pipeline that begins to build a rich relationship. Take a step back and show me the big picture, and how search integrates with it. And tease me with some really insightful discussion about how search will become the functional engine of advertising delivery online, delivering just the right message to the right person at the right time.

I’m not sure what the answer is, but I do know that the marketing industry is a long way from knowing everything there is to know about search. I would hate to see search be conspicuously absent from the spring Ad:Tech line up.

Google Does It Right, and Still Makes Money

We’ve done three studies now on how people react with search engines, and one finding that has been consistent across all three studies still amazes me.

All other things being equal, Google dominates as the search engine of choice. In the latest survey, Google was picked as the favorite engine by a walloping 82.9 percent of respondents. Nobody else even came close. Yahoo! limped into second place with a scarce 7.5 percent of the vote.

So, why does Google dominate to this extent? Is it the best search engine? Well, it’s good, but arguably there are others at least as good. The brand has certainly become a household word, but Yahoo! was there first, and look how their market share has dropped.

Google’s success with users comes primarily from an unwavering respect for those users. Google has always put the user experience front and center, and this commitment to has bought them fierce loyalty.

Sometimes the Bottom Line Isn’t Always About Money

Search engines make money when people click on the sponsored listings. Except for some paid inclusion revenue, minimal compared to the paid placement streams, search engines make no money from organic listings.

Following that line of reasoning, it seems to make sense to encourage as many people to click on sponsored listings as possible. Every click puts more money in the bank account.

This line of reasoning has been used at most of the other engines. MSN, Yahoo!, Ask Jeeves and others have all tried to maximize the amount of sponsored real estate on their results page. Ask Jeeves won’t usually show an organic listing without the user having to scroll.

The engines love to see more click-throughs on sponsored listings. The advertisers love it. So why not? Everybody wins, right?

Not the user. We go to search engines for organic results. Sure, we’ll click on a sponsored listing about 30 percent of the time if it appears relevant, but that’s not why we go to the search engine. We go for the unpaid listings. If we can’t find them on one engine, we’ll go to another where we can.

Tale of Two Engines

Google gets this. They have the lowest sponsored click-through rates of any of the major engines. While sponsored listings have been given prominent placement, the organic listings always have center stage. They’ve never tried to trick us with vague labeling of sponsored results or tried to push organic off the page by increasing the number of sponsored ads on top.

Short-term, that strategy would certainly boost Google’s revenues, but what would happen in the long term? Well, perhaps we have to look no further than Ask Jeeves. They’ve played games with their organic rankings, trying to boost their sponsored revenue. And if you look at click-through percentages as recorded in our surveys, it’s worked.

About half the click-throughs on Ask Jeeves occur on sponsored listings. Google only captures 23.3 percent click-through on sponsored ads. But 82.9 percent of our 1,500 respondents said they use Google and only o.6 percent said they use Ask Jeeves.

When you slice the pie that way, you’re going to end up with a lot more revenue, no matter what your click-through percentage is.

The User Giveth and the User Taketh Away

Online loyalty is a fickle thing. Google has never forgotten where it came from. It emerged from nowhere and gained leading market share because it focused on one thing: the user. Then, it found ways to create revenue from that model without jeopardizing the delicate balance between profit and the user experience.

Google has realized that user traffic is a privilege, and you can never lose sight of that fact. If you treat them right, you will be rewarded. Fail to do so, and you’ll end up with a very small slice of the pie.

Search Innovation: Looking for the Average Joe

First published Oct 27, 2004 in Mediapost’s Search Insider

Google’s beta release of their desktop search tool was their shot across the bow of the USS Microsoft Search. Following hard on the heels of promising technology releases from Blinkx and Copernic, Google is staking their claim to the desktop search space.

And Microsoft seems to have been caught flat-footed, as they continue to push back the deadline for the release of Longhorn, which will integrate desktop search with the operating system. Many seem to think a search related announcement out of Redmond, Wash. is imminent.

So, if one looks at what’s come out of the major search engine labs lately, you’ll see a rush of new technologies centered on the ideas of desktop search, local search, indexing of rich media, and personalized search. It seems that everything we’ve been talking about in the past three years is suddenly coming on the market in one fell swoop.

This has prompted a number of analysts to start asking where search is going. I’ve been firmly seated on that particular bandwagon, adding my own prognostications to the many that are out there. But sometime last week, I slapped my forehead and pronounced myself an idiot (beating several others to the punch).

It really isn’t the release of technology that will dictate where search is going. It’s the public’s acceptance of that technology. And I’m not speaking about a few techno geeks huddled in the cool blue glow of a LCD flat screen. I’m talking about the masses.

Innovation Only Makes a Difference When It’s Accepted

There is a dilemma that is inherent in technical innovation. As the innovators, we tend to get caught up in the possibilities of technology and base our business decisions on it. But the fact is that the success of technology only takes place with widespread adoption by the general public.

In the high tech business, we tend to be surrounded with others like ourselves. We are the classic early adopters, looking for the latest technological gizmo. We tweak our computers and other various electronic gadgets, spend hours tracking down problems with drivers, and happily put up with bug after bug to gain an edge over the less technically savvy.

In our biz, we all tend to be members of this relatively small segment of the real world. Unfortunately, we sometimes make decisions that seem valid because everyone we talk to agrees with us. It’s not until the public flatly rejects our innovations that we realize it was never capable of going beyond the research lab.

So, if you ask me, or any of the others who have been writing about this, which of the emerging search innovations will make the difference in the industry, you might be asking the wrong person. I’m a geek. Go ask your Aunt Mildred, but be prepared to spend some time explaining what you’re talking about.

Public Adoption Can’t be Rushed…

As early adopters, we work on a radically different time line than the general public. We tend to leap into new technology before it’s fully tested. We move in a matter of weeks or months to try the latest new thing. The rest of the world takes years. So as we try out local search, desktop search, and personalized search, remember that the latest developments will probably take a long time to trickle down to the average Joe… unless you leave no options!

This opens up a rather interesting advantage for Microsoft in the search game. Because of their domination of so many parts of our interaction with our computers, they can force adoption of a new technology to an extent no one else can. Every other player, including Google, has to convince us that their technological innovations are worth using. Microsoft can leave us with no choice. So Google will continue to roll things out of their search lab, and we will eagerly install the latest beta.

Someday (probably soon) a major development will come out of Redmond about Microsoft Search. We “in the know” will rush to pronounce it a failure, or success, but the judgment isn’t really ours to make. It’s the millions of people who have no idea that Google now has a desktop search tool, or that Microsoft is integrating search into their operating system, that will ultimately make the difference. And they will only bestow that success when they’re good and ready.

The winner of search will be the one who is the shrewdest about controlling that timeline.

Do We Want a Smarter Search Engine?

First published in Mediapost’s Search Insider – September 28, 2004

Search engines are knocking on the door of the future. The 800-pound gorillas of search and brash new upstarts like Blinkx and Gurunet are working to find a way to make search more intuitive, ubiquitous, and intelligent.

Someday, search will be interwoven with everything we do and consequentially, we won’t lift a finger. Links to the sites we’re looking for will suddenly appear in a discrete search pane or a pop-up window. It’s inevitable.

Or is it? Is this what we as search users want? Do we want to hand control over to an omniscient, eerily cheerful search assistant that knows far too much about our user patterns and personal tastes?

Friendly Search Engine Seeking Single Middle Aged Woman

The personalization of search has been bandied about as the next big step forward in the industry. We need (so we are told) search engines that get to know us and what we like. Blinkx is already heading down this road, and Microsoft has a team of engineers busy in their Cambridge, England lab working on making their brand of search more attuned to the user and the job currently at hand. If you look at the type of people Google hires, you’ll find the following interest areas featured prominently: profiling, artificial intelligence, and machine learning.

But to make these search enhancements work to their full potential, we crawl onto the very slippery slope of user profiling. As the search engine observes us, it can create a profile of our interests, usage patterns, and other very personal information. It can then use this information to make its search results more relevant to the individual user.

Marketing Gold, Privacy Dynamite

The question is what happens to this profile? Obviously, each profile is worth its weight in gold to advertisers. With information, they can target their message to exactly the right audience. But even if search technologies offer this capability, the vast majority of providers have resisted the temptation.

The Google Toolbar has been around for four years, and if you install the advanced version, the End User License Agreement says that the toolbar will send information about every URL you visit back to Google.

While this is for the relatively benign purpose of retrieving that site’s page rank and other information, the fact is that Google has the ability to track each and every Web page you visit. At least Google is up front about letting you know. Other search tool bars and spyware apps aren’t quite so ethical.

Suranga Chandratillake, the CTO of Blinkx, indicated that they had the ability to incorporate a fairly basic level of artificial intelligence into the product to make the search suggestions more relevant to the individual user but had chosen not to. “Early users indicated they didn’t like this idea. Privacy is a big concern for them.”

It appears that search providers and contextual advertising providers are setting wheels in motion that will bring an inevitable head on collision between the wishes of advertisers hoping for better targeted vehicles and users concerned about their privacy.

At this point, the more ethical advertisers are standing on the right side of a gray and sketchy line that’s determining what should be done with the mounds of information collected from users.

Either contextual advertising is being served based solely on the nature of the job at hand with no reference to a stored profile, or the information is just sitting there, collecting dust in a data warehouse on some gargantuan hard drive. But no one’s saying they’re throwing that data away. I get the feeling they’re all eyeing each other nervously, waiting for somebody to step over the line.

Search has the ability to become smarter and more helpful. But as anyone old enough to remember “2001: A Space Odyssey” can tell you, an all-knowing, irritatingly polite computer isn’t always mankind’s best friend.