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Saturday, November 19, 2005

2005 vs. 1968

Recently I had the pleasure of dining at Google's NY headquarters (not pictured at right). It was a modest-enough cafeteria setting, albeit with topnotch food and of course great company!

Prior to that, I had the curious experience of viewing a few analogous scenarios at Old Media companies. Here, you could glimpse dozens (what seemed like might be hundreds in a good year) of company execs settling down to leisurely lunches in lavishly-appointed dining rooms.

In related news, a recent article about Yahoo! (was that in Business 2.0 or Fast Company?) revealed a rift that runs deep in that company, between rank-and-file and new economy bred execs, and the new Hollywood talent (like VP Lloyd Braun) that has been parachuted into the company.

Geek perks lavish? Not compared to the value they add to the economy. Not compared with those other guys.

Posted by Andrew | | | Permalink

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Thursday, November 17, 2005

Why Ad-Supported Business Software Won't Work

I think the hand-wringing over software companies searching for new business models is a bit over the top. Sure, we'll continue to see application that can be run as a hosted service continue to move online and proliferate.

But... business software supported by advertising? Not gonna happen!

Microsoft, in its typically greedy fashion, seems to be trying to find every way possible to get ads in your face, now that they've caught the pay-per-click advertising bug. I think this will inevitably turn out to be another case of vaporware or a scare tactic against competitors, and here's why.

Business applications are designed for specific business purposes that require concentration. And business managers tend to want their employees to focus on the task at hand. Advertising, when not in a helpful pull mode, is disruptive.

Pay-per-click -- and even content-targeting -- ads work because the user initiated the action that led to the ad being placed in front of his eyeballs. Those pesky text ads might be just what the user was looking for.

But if you 're working on a spreadsheet of your company's financials, the last thing you need to see is an ad for a CPA that will launch a web browser and take you away from your task. It's just distracting. If you are looking for help with a spreadsheet, you'll search the web, right?

So, it's a neat idea, but the idea of ad-supported business software is a non-starter.

But, I could easily see certain consumer applications, such as photo-editing software, being ad supported. What apps could you see thriving on this model?

Posted by Cory | | | Permalink

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All Your Base Are... Oh Yeah, Someone Else Used that One Already

Don't rule out the idea that Google Base is just an elaborate ruse for Google to sneak into two or three particular biggie verticals, like automotive. (Sample search.) :)

Has nothing to do with eBay though. Nah. Nope. Heck, you can post recipes on there! The Dead Sea Scrolls! Your son's used baseball glove! Maybe your car! Your Bryan Adams collectible votive candles!!!!

Nah, no relation whatsoever to eBay.

To be serious for a moment, does this mean Google will toss Froogle into the dustbin of history, as a weak first draft?

Another thought: Gary (great post) asks where the revenue stream is. Hmm. Could this be a paid inclusion model? Where eventually you'll pay per click or something? That would be pretty audacious, Google offering paid inclusion when they said all along they wouldn't. Hmmm....

I tend to disagree a bit with Gary that the whole process is going to be too cumbersome for average sellers. eBay takes a little bit to learn, but the payoff can be enormous. I have a friend who has a boss who won't do the web thing, so the friend started posting pics on eBay of the high end equipment they liquidate, and keeping a % of the sale whenever they make one. He does this in his spare time. I'm sure the potential upside of a service like Google Base, to those who stand to generate steady sales, would more than justify dabbling in a bit of extra work learning how to upload and label so-called "content".

Posted by Andrew | | | Permalink

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Wednesday, November 16, 2005

Organic Search Rankings on the Move, or Pink Hats Meet Green Hats

What goes up, must come down?

I'm hearing feedback that makes Jagger sound a lot like how we described Florida. But it might be an even stronger brew (Jäger?).

Google's algorithmic update is getting most of the ink, but Yahoo also came out with its own weather report. We're hearing less buzz about this one, but here too, hundreds of thousands of businesses may feel the impact. We can see from the comments that many businesses have lost many of their pages from the index, and one called has apparently been completely banned. A major insurance comparison site I know gave up trying to understand why all their pages got indexed by Google and rank well, and very few in Yahoo, and rank poorly... so they just paid for inclusion in Yahoo, and it got them in right away.

It remains to be seen whether history will judge Yahoo "Weather Report for November 2005" to be more brutal than Google's infamous Jagger, Florida, etc. updates. Clearly they both affect a lot of people.

In any case: imagine you're sitting there with total control over the search engine ranking algorithm - or even partial control over it. If you're the user, you might skew it towards "research" and away from "shopping" ... some of the time, or always. You can do this right now if you play with the personalization feature in Yahoo!

Some of these algorithm updates are simply about that. About reorienting the algorithmic emphasis in a fairly far-reaching way.

Some are suggesting that Jagger is mostly about weeding out common spam techniques. Clearly, there is nothing new at all about ferreting out new ways of adding hidden text to documents. Those who think their short-term gains in rank entitle them to anything long-term are misguided, especially if they're cheating the engines. Most hardcore spammers know and expect their creations will get dumped from the engines, and they're fully prepared to reset and start again.

It's not the black hats who will be the hardest hit by these sorts of updates. Nor will it be the "white hats" - if white hat, to you, means creating a blog or an information portal and virtually divorcing it from any effort to directly sell a product or service.

It'll be the "rose hats" -- or at least those with special rose-colored ranking goggles installed -- that get hammered in many cases. Businesses who achieve certain ranks in the index, and believe they got there on merit and thus deserve to stay where they are.

Why "deserve"? If you try the little personalization slider on Yahoo, or investigate the various ways SE's could tweak the mix of results, you'll see that in fact it could be much harder to rank if you let the user decide the algorithmic mix. For now, search engines might be much more lenient on the local furniture store's ranking than some other type of judge might be on an average day. Maybe search engines will use machine learning to filter out certain kinds of commercial enterprises in the organic listings, if it becomes increasingly apparent that the average searcher is looking for some other type of information.

Try this: go to Yahoo! Mindset and type in a query like "divorce settlement." Then take the slider (you'll need to let the technology build a database for a few seconds) and move it all the way over to the shopping side of the dial. Take note of the rank order of the listings. Then slide it all the way over to the "research" side of the dial. Presto -- different search results. The concept of a "single" search engine index with a single way of ranking everything is dying, to be replaced by personalized search in various forms.

So it's not just a matter of search engines just weeding out a few spammy pages. They're also moving the slider around, as it were, on different aspects of the algorithm, and then measuring how loudly business owners and webmasters scream in response, as well as the impact on revenues.

And no question about it: updates like Florida and Jagger seem to be coming at a time right close to Christmas when the impact on businesses seems greatest, and their incentive to buy paid listings will be irresistible.

Assuming there is another loud outcry, you can expect Jagger to be watered down some in a month or two. But it will have achieved two intended effects: removing spam and reminding business owners to buy advertising on the search engines.

While many users happily avoid commercial messages, some of your customers will be directly searching for you where they know you're a business and want you to be: in local search, in the ads near search results, on eBay, in shopping engines, and so on.

No one ever said you were entitled to free search rankings as a substitute for having a great product and an advertising budget to support that. No one. Ever. Search rankings are great public relations, and you'll get your fair share, if you do the right stuff. But they're a bonus.

This brings up another twist: with Yahoo! Search, it seems more likely that you'll continue to be able to pay for inclusion (as you can now) in the organic rankings to avoid, in essence, being "Jaggerized." On Google Search, then, you have no paid recourse for organic rankings (unless you pay a spammer, which might backfire on you or definitely will backfire on you, depending on your company). On Yahoo! you get the feeling that something is different; that the gap is widening in philosophy. Google wants to stick to the idea that search results aren't for sale. Yahoo pays lip service to this, but seem to be deepening their commitment to paid inclusion as a tool rather than backing off on it.

I fundamentally disagree with paid inclusion. I wish it would go away, because it would simplify life and make organic rankings free, the way "they're supposed to be." But I'm increasingly convinced that there is very little "supposed to be" in the search marketing world anymore - nothing truly organic, nothing genuinely natural. Search technology in the abstract is still a thing of beauty and power. But you're reading this because you're a marketer, aren't you? If so, you must be pragmatic. If the hat fits...

Paying for inclusion in the Yahoo! index, then, is just a different shade of unnatural that might be a sound move for many enterprises with a stake in seeing guaranteed indexing in Yahoo's search index.

And to conclude with some sobering food for thought for you search marketing diehards. At some of the seminars I teach, only one or two hands go up when I ask who has heard of "Florida" as it relates to search marketing, Google, etc. These are evidently not hardcore SEO's, but the point is, they're corporate folks with an abiding interest in their search engine visibility. And they don't know that updates like Florida and Jagger can blow the hats right off even the feistiest player. The world, then, is full of people who see the search engine ranking game as a to-do list that is easily followed. In other words, they are thinking in terms defined long ago, in 1997 or earlier. There is a lot of education to do. And a lot of rose hats need to change over to some other color: white, gray, even black maybe. Or, my favorite SEM hat color: green.

Posted by Andrew | | | Permalink

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Tuesday, November 15, 2005

Biggie Verticals

There's some buzz today about the size of the travel vertical in the overall ecommerce picture. Indeed.

Last night I was lucky enough to sit with two eBay'ers at dinner. They asked us to guess what was the #1 category for them by items sold. Trying to be extra clever I guessed sports card collectibles. Someone else just guessed "collectibles." According to them, the right answer is apparel! When I proceeded to tell the first half of an off-color joke about used clothing, they told me they'd have to tell me a funny story... but not in the restaurant. Never got that one out of them. :)

And according to this same "research," the biggest item for eBay by total dollars spent is automotive (eBay Motors).

That reminded me: Google recently had a breakfast seminar on the trends in automotive sales & marketing online, in Toronto. What are they up to?

So there's your biggie verticals roundup!

Posted by Andrew | | | Permalink

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Monday, November 14, 2005

It's Free Day!

1. Sweathogs ascendant. AOL to offer old TV shows for free, but also Tivo-proof.

2. Google frees Urchin, thus dropping the other shoe on the ongoing saga of Google's entry into the analytics space. The usual pros & cons apply: free is good, integrated is good (maybe even very good), but giving Google your private business data? Priceless... to Google that is. Buyer (freeloader) beware. I do concede that telling buyers to beware of a free product might be a slightly quixotic refrain at this stage of the game.

In both cases, we watch and wait to see what the other, other shoe might look/feel like.

Posted by Andrew | | | Permalink

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