Waiting for Google to Exhale

Wal-Mart changed the way America shops for budget minded goods. Retailers everywhere shudder every time a new Wal-Mart store opens. People seem to enjoy worrying about things like inevitable changes and, well, finding new things to worry about.

Likewise, every time Google blinks, sneezes, or coughs, the search world reacts quickly. Sometimes, we overreact, but at least one thing is certain. If you don’t like the way search results appear, wait a minute because they’ll change.

Since I used the expression (waiting for Google to exhale) in a recent column, it seems the expression is catching on. Two big issues arose from SES San Jose last week, as it seems Google has once again exhaled with universal search and yet another refinement to how its paid listings are positioned.

Bring the Buying Binge

New on the paid listing front, Google has announced a change in how ads climb to the top of results. Since the day quality scoring appeared on the scene, search advertisers have struggled with the more advanced aspects of search advertising.

Quality scores are affected by the relevance of keywords, text, and landing pages. Before quality scoring, simply bidding up keyword costs helped one climb to the top of paid listing results. Simply put, the latest change in search ad bidding involves the relationship between actual and maximum CPC or cost-per-click.

The ad’s actual CPC had been determined in part by competitive bidding, and no consideration was given to maximum CPC. In summary, the new formula for determining top placement may require advertisers to push the envelope of what they consider an acceptable maximum cost-per-click.

Confused? A lot of people are. While the new formula is designed to be an improvement, the announcement really only means advertisers will have to pay very close attention to cost and return figures for the next few weeks, and particularly into the upcoming holiday season.

Comingling Content and Ads

Universal search is bringing back the notion of search ads and natural search listings living together in harmony. Combining video, image, audio, and news into one search result may seem like a new idea, but the real buzz lies in the relationship between search ads and natural search listings.

Remember when search ads were forced to be labeled sponsored? Here’s a little stroll down amnesia lane for the fortunate many who missed the early developmental hiccups in paid search. In a nutshell, consumer activist and presidential candidate Ralph Nader and the Federal Trade Commission decided search engines should be unbiased information providers.

Letters were sent to search providers and petitions were signed. No legal precedents were set because most of the search sites (the high profile ones, anyway) quickly complied by labeling the ads “sponsored.”

Over the years, I have read study after study about how consumers might react negatively to paid listings. Aside from Google’s $11 billion dollar cash flow at the end of 2006, my favorite conclusion came from a June 2003 IAB survey in which people were asked what was most important when viewing search results. Only 1 percent thought whether the Web site paid to appear or not was most important.

Each and every time I ask marketers and information providers about the paid or unpaid search listing question (which performs better for you?), the answer almost always comes down to an information or commerce search activity analysis. Those seeking product information see more activity with natural search, but when it comes to purchase decision time, accurate and compelling search advertising leads to revenue.

Breathe Easy

The initial panic inspired by the universal search announcement back in May has subsided. Marketers and information providers are now taking a closer look at the changes and asking, “What should we do?”

The short answer is, not a thing. Many optimizers began looking at alternative search years ago. Images, video, and audio have long been considerations for smart search optimizers everywhere. Remember when we called additional listings search creep?

The longer answer involves a great deal of speculation and wild guesses. Ads and content may come closer together on all search sites. Since most people can’t tell the difference or don’t care as long as the information is relevant, where might the harm be?

New formulas for paid listings and bringing together multiple content assets into one results page are designed to be improvements. All improvements must be good, right? Then again, I remember when a certain search provider’s “improved” results required advertisers to call in at the end of each day to find out how many clicks they had received the day before.

The point of all this banter is actually quite reasonable: If a new trick doesn’t work, chances are it won’t take all that long to get fixed. Universal search may be here to stay, or it may not. Clearly, it is going to take at least another year for all bugs to get worked out.

The best practices of including all of your content assets in your optimization or marketing strategy remain the same. In the meantime, just remember the mantra, “don’t panic.”

Want More Information?

Check out Mike Grehan’s recent columns on universal search here and here.

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