Google increases font size for AdWords ads. Ugh.
Back in 1998, Google founders Page and Brin published The Anatomy of a Large-Scale Hypertextual Web Search Engine describing the fundamentals behind their new Web search engine. While I would certainly recommend everyone to read the paper, for the purpose of this post, Appendix A: Advertising and Mixed Motives is particularly worth a read. The section describes how search engines who have a business model that relies on advertising revenue are likely to be conflicted. They describe some situations where search results might be altered to please advertisers. As a result, they write “we expect that advertising funded search engines will be inherently biased towards the advertisers and away from the needs of the consumers”.
Fast forward a few years and as it turns out, Page and Brin’s Google dominates the search scene and is massively profitable. Wait..what was that? Profit? Where’s this money coming from? Oh that’s right: advertisers. Well, to Google’s credit, they have not (as far as we know) allowed advertisers to directly influence their search results. Instead, AdWords ads (paid results) show up off to the right side of the (organic) search results page, clearly marked under a “Sponsored Links” section. Google’s position on this is that the ads don’t interfere with organic search results, but if you do want to see the ads they are clearly marked and since the ads are targeted to your search, there’s a good chance that they may actually help your search. Fair enough.
As of last week, something changed. The font size used for AdWords advertisements on Google search results pages got larger. The size is now the same size that is used for organic search results. While many users may not even notice the change, I personally find it very dubious. The motivation for increasing font size is to make ads more noticeable and thus more likely to be clicked. This increase in overall CTR brings more advertising dollars to Google and that’s certainly good news for the business.
However, is this just one of the first moves of many to increase ad CTR? I doubt it. Shareholder pressure to maintain profit growth may force the company to employ more tactics to drive ad revenue. Furthermore, what is the message that Google is sending to web publishers? Until now, Google (and of course all the SEO guys) emphasize that most users click on the organic results and not paid results (statistics show that the ratio of organic clicks to paid clicks is about 4:1-5:1) and so to generate traffic to your site, the most effective approach is to produce relevant, quality content and effectively structure it. Google prides itself on rewarding publishers who create good content. But will Google succumb to advertisers over the long-term? I guess we’ll have to wait and see if Brin and Page’s comments back in 1998 hold true.
…I agree, and this is exactly one of the many growing pains of Google – the lack of direction and the lack of a sustainable business model.
Think Yahoo! and it reminds you of their various Internet media related services , because Yahoo has grown up to be a brick and mortar media services company.
Think Adobe and it reminds you of their smooth fonts and pdf document reader / publisher. Good.
But think Google and it reminds you of their search engine, along with other kool but non-cohesive tools. Like Google maps, kool. Google email, kool. Google talk, kool.
And yet, when you think of Google, the first thing you think of was Internet search.
What this means is that as soon as this core competency is cannibalized by Google’s drive for ad revenue – which right now, is the primary source of income – then it won’t take long before Internet users shift to another search engine. One that is able to sustain their business not only by high quality search, but by other concrete, profitable offerings (yes, you know i’m thinking Yahoo!).
So then Google stock drops, and suddenly all the smarties are questioning why they entered Google in the first place. Typical answers will include: “stock options”, “fun place”, and “I can make an impact to the world”.
But guess what, when there is no money, there is no stock options. Lay offs will happen, and I bet you that’s not fun. And impact to the world? what world? no one uses Google anymore.
And believe me, smarties in the valley will and can jump ships quicker than the time it takes to search for “sustainable business model” on Google.
Wait, what Google?
Maxwell
15 Dec 05 at 12:07 am
I think that Google may be starting to get too arrogant in the way it does conduct business. This probably can be attributed to their high stock price, but also because of their near monopoly of internet advertising.
E.g., I have heard and read countless stories of medium to small sites complaining to google about click fraud when using Google’s Adsense. Yet google basically does nothing but shove its middle finger to these sites and tell them to pay up on their fees (and yet these sites are essentially a small partner to google). And really, what can these sites do? There really is no other good alternative to get revenue from your content.
About a month ago, Bill Gates mentioned that msn adcenter (microsoft’s new internet advertising service, which surprise, surprise, only works with internet explorer) have been tinckering around with the idea of actually paying users to click on adcenter ads (although of course there is countless ways they are going to have to prevent fraud using this model). However, it does seem nice that Google may soon be facing some serious competition in the internent advertising market. Even though if it is from Microsoft.
stooker
2 Jan 06 at 4:00 am
[...] Unbelievable. I’m finding it difficult for me not to care. It seems like Google’s need to satisfy its shareholders is corrupting the company’s values again. Google, search, Yahoo [...]
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