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No Search for Coca-Cola?

Written By Drupad Sil | May 6, 2008 | Share This |

Coca-Cola

An interesting quote from Peter Sealey, former Coca-Cola CMO, on paid search as reported by Miguel Helft at the New York Times:

“Search is great, but you can’t advertise Coca-Cola in search.”

Danny Sullivan brought this to our attention over Twitter. Now, while the context of the article is how Google is the winner in this Microsoft-Yahoo standoff (there’s no escaping that story, is there) it’s just difficult to overlook a statement like that. I mean, search connects brands with concepts - is there anything more central to Coca-Cola’s marketing than this? A quick search confirms that Coke’s current management believes this as well - paid search ads for MyCokeRewards.com and the Coca-Cola Store show up on Google when you search for the brand name. Furthermore, the first page of results is dominated by Coke-branded pages including Coca-Cola.com, DietCoke.com, theCoca-ColaCompany.com, and Music.Coca-cola.com. Why does that make a difference? The brand’s presence is so broad that Coke’s presence is pushing potentially inflammatory websites off the first page, such as KillerCoke.org, a website that outlines the torture and killings of union leaders at Coca-Cola bottling plants in Colombia.

No wonder Peter is the former CMO of Coke.

Really, this is just more evidence that CPG companies don’t understand search and online advertising, as we mentioned last week.

Search for Branding - Learning to love the Click

Written By Drupad Sil | May 1, 2008 | Share This |

Waste of Money

Interesting article by Jack Neff at AdAge. For those of you without subscriptions, the premise here is that consumer package goods (CPG) companies are unhappy with search marketing. Not because they don’t believe it’s a good branding vehicle. In fact, the article goes out of its way to assure us that CPG companies have been sold on the branding properties of search - instead, they’re upset that their traditional methods of buying media (wielding giant budgets in order to negotiate preferred placement and rates) don’t fly in an open auction marketplace.

Especially vexing to these advertisers is the idea that they might actually get penalized for showing up more frequently:

“An executive at one CPG marketer recently noted how perverse the search-pricing model has become for the industry.

‘It used to be that impressions weren’t in the pricing model,” he said. But Google eventually incorporated them in a roundabout way, he said.

‘If you get too many impressions without getting clicks, the price goes up, or they kick out off completely,’ he said. ‘So they thwarted with their pricing model the window we had to actually deliver impressions…because of course it makes their revenue go up. But that makes our value go down – for everybody in package goods.’

He said the company had purposely tried to maximize impressions while minimizing clicks in search ads, though he termed that ‘smart buying’, not ‘gaming the system’.”

To me, this approach seems completely wrongheaded.

Search ads absolutely contribute to branding - having a brand show up in a prominent place on Google or Yahoo’s results page draws a big mental connection between the query and the company. But simply showing up in search isn’t valuable. The ad placement isn’t really where the value is. It’s in the click. The click is what transforms a branding opportunity.

When a person visits a search engine, it’s not because they want to read a bunch of company listings side by side. It’s typically because they want to visit a site that can offer useful information to a question or need they have. The ad itself doesn’t have much value… it’s all about context and intent. “Does this ad answer my question? Let’s click through and find out.” After the click, the user makes a decision about the relevance of the result, and therefore the brand.

Saying that you appreciate the branding value of search and actually understanding the branding value of search are two completely different things. I understand what’s causing the dissonance - CPM pricing is comfortable. They understand it, and it gave them advantages. But this new model isn’t going away anytime soon. It’s provided users with a service that they generally appreciate, and has made more money for the engines than they could have made under the old two-martini-lunch-and-a-handshake model. The smartest brand marketers understand this and have learned to love the click.

AdWords Displaying Ad Scores on Domestic Searches

Written By Drupad Sil | April 29, 2008 | Share This |

Google

Some interesting happenings on Google. Earlier today, SearchEngineRoundtable reported on a forum thread started when one advertiser noticed Google displaying three scores under a Google Netherlands ad. The scores listed are Pscore, mCPC, and thresh. The article goes on to suggest that mCPC is minimum cost-per-click, while Barry Schwartz at SearchEngineLand guesses that thresh may refer to a threshold score for the ad display while the Pscore may be a quality score metric related to PageRank.

Contrary to other reports, it’s not just for international searches, however. At Reprise, we noticed the numbers appearing under domestic searches. In the screenshot below, a search at 11:35 EST for “grand theft auto” pulled up two sponsored links, with the scores displayed between them (boxed in red).

 

Strange Google

 

Strangely, subsequent searches were unable to replicate the result, and as of noon EST it seems the scores are gone from international searches as well. We’ll be keeping an eye out for any Google updates on the issue.

Google Sued for Ad Fraud

Written By Drupad Sil | April 23, 2008 | Share This |

Google Legal

Legal firm Kabateck Brown Kellner filed a class action lawsuit against Google on Tuesday. The suit, filed on behalf of one David Almeida, accuses Google of deceiving its customers into paying for ads they didn’t expressly request. Elinor Mills at CNET gives the details:

“When participating in Google’s online auction-based advertising system, customers specify what they would be willing to pay for pay per-click for words or phrases that will trigger ads displayed on Google’s search site, as part of Google AdWords. They are also given the option of bidding for ads that appear on third-party Web sites, also called Google’s ‘content network’, which is part of Google AdSense.

On the system, customers see two blank boxes, one for typing in a bid for ads on Google.com, and another one, marked ‘optional’, for putting ads on content network sites. Sophisticated search engine marketers know to put a ‘0’ in the box for the content network AdSense sites if they don’t want ads there…

Google does not inform its advertisers that if they leave the box next to the content bid blank, Google will use the advertiser’s bid for clicks occurring on the content network, the lawsuit says.”

That’s not all, according to Dave Szetela at SearchEngineWatch:

“The truth is, advertisers don’t see this option during campaign creation. The only way for them to opt out of displaying ads on the content network is for advertisers to explicitly edit the settings of their campaign after creating it, and un-check the box labeled ‘Content Network’ – which is checked by default. Some would reason that this makes Google even more exposed to fraud charges.”

The question that people are raising is whether it makes sense for Google to knowingly exploit people using this tactic, draining Google advertisers of their online budgets. David Snyder at Marketing Pilgrim doesn’t think so:

“I’ve heard complaints such as these from several business owners…The issue is often discovered by advertisers when they see reports of low CTR.

The idea that Google would knowingly deceive advertisers seems a bit far fetched to me, well not that they would deceive, but that they did deceive.

Although I agree that they may have missed the boat on a usability flaw, which is something all of us are guilty of from time to time, I do not see that the giant of the online space has to gain by intentionally leading advertisers to third party publishers. In fact, such ad delivery means that Google has to give up a share of the advertising revenue earned. The company would probably prefer the ads be served on their own search network, where they can take in 100% of the revenue.”

We actually disagree. It’s definitely a gray area. The forced opt-out is a clear usability flaw of the kind that Google doesn’t typically make. But we also don’t think that someone at Google is intentionally trying to fleece advertisers by randomly placing their ads across a less relevant network.

This is more or less a legacy issue from the times when Google didn’t let you bid separately on content clicks - either you bought the whole shebang at the same price, or you were opted out of the network. The intent, at the time, was to prove to advertisers that the network had merit. Not necessarily equal to search, mind you (which is why the engines eventualyl allowed advertisers to set separate bid rates) but still valuable nontheless.

But at this point, the practice of auto-opting advertisers into the network, even if they leave the box blank, comes off as a bit sleazy.

Either way, it’s a story for AdWords advertisers to follow. Kabateck Brown Kellner has successfully sued Google for a $90 million click fraud settlement, and recently won a similar settlement from Yahoo. If the lawsuit is successful, and Google stops automatically extending campaigns into content, I wonder what the impact would be to their bottom-line? For now, Google has no comment.

Rules of Engagement: Time Spent and New Metrics

Written By Drupad Sil | April 17, 2008 | Share This |

MediaPost

Web site metrics are an indispensable asset to any online marketing campaign, but there is hardly a standardized method for their use. This is due partly to disagreement over the relative importance of certain metrics, and also to inaccurate measurement techniques. Furthermore, the constant evolution of online advertising forces the creation of new metrics to accurately capture their effectiveness.

Reprise Media’s Managing Partner Peter Hershberg weighs in on the metrics debate with an article on MediaPost:

“As the online experience becomes richer, it’s also becoming difficult to define meaningful interactions, and even more difficult for analytics tools to aggregate all this data. Very soon, those tools will need to measure feed subscribers, Twitter followers, and the number of Facebook wall posts alongside more traditional site statistics such as unique visitors, page views and time spent. The challenge marketers face is making sense of all that data and applying that information to the way they buy ads now (currently page views and impressions–although this will change soon, too), both online and across their broader marketing mix.”

Get the rest of the article

Is Search Recession-Proof?

Written By Anthony Iaffaldano | April 15, 2008 | Share This |

At this point, I think most of the civilized world has established that the U.S. economy is heading into a recession.

The signs are starting to crop up in the advertising world: Companies are starting to make hard decisions, like Gawker which announced yesterday that it was dumping three blogs, including Wonkette, in a cost-cutting effort. Cautionary commentaries are beginning to crop up in most advertising publications, like this one, advising media buyers how best to weather the storm.

So how about search marketing? Has the panic of a down market set in yet? Not exactly. In fact, as we continue to inch towards the abyss, SEM may prove to be the most recession-proof of all ad formats.

In an article he penned for Search Engine Watch, Reprise Media’s Managing Partner Joshua Stylman shares his viewpoint on search marketing’s unique resistance to a recession:

John Wanamaker famously said, “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” He would have loved search marketing, because it is one of very few kinds of media that provides visibility into the wasted half. Furthermore, it is arguably the most accountable of all advertising media. By virtue of robust reporting from search engines, sophisticated web analytics, and back-end tracking systems, advertisers can see exactly where their money is going in a paid search campaign: what keywords are converting into sales or page views, and what’s not working.

Get the rest of the article

Paid Search Spend Will Be Up 113% by 2012

Written By Sepideh Saremi | March 26, 2008 | Share This |

new media

Digital and non-traditional media will be getting a lot more ad dollars, according to a study from research firm PQ Media, USA Today reports. The breakdowns suggest that online video will see the greatest percentage of growth in spending - with projections at above $12 billion, or 389% above current levels. That kind of growth makes sense in a space that is still growing, and in which monetization is difficult. Online video is part of “18 emerging markets” that will see “$160.8 billion in 2012 — up 82% from 2008.”

PQ also projects that paid search spend is projected to grow 121% by 2012, making it a whopping $26 billion industry over the next four years. But USA Today notes the numbers comes with a caveat: “One risk in the forecast — which PQ calls the first comprehensive analysis of the alternative media market — is that some figures are based on data that are not time-tested nor universally accepted.”

ESPN Dumps Ad Networks

Written By Sepideh Saremi | March 24, 2008 | Share This |

espn ad networks

ESPN is dropping its ad networks, MediaWeek reported today. MediaWeek suggests the sports publishing giant has decided to sever ties with ad networks because, like many publishers, the company sees ad networks as diluting the value of its content. From the article:

“We’re heading down a path where it no longer suits our business needs to work with ad networks,” said Eric Johnson, executive vp, multimedia sales, ESPN Customer Marketing and Sales. Sources say that ESPN would like to rally support from other publishers behind this move and ultimately tamp down ad networks’ growth. Turner’s digital ad sales wing is rumored to be considering a similar move, though officials said no decisions are imminent.

The central issue is whether or not ad networks devalue a site’s content, or if they’re salvation for ad inventory that would be wasted without them. Because they bundle the traffic of smaller sites in a large network, ad networks have recently been pitted as directly opposed to the traditional ad sales model in publishing, which is based on direct relationships with advertisers and driven by premium, branded content. Some online publishers say the benefit outweighs the risk, and it depends on the content (again, from MediaWeek):

“Not all inventory is created equal,” said Peter Naylor, senior vp, digital media sales, NBC Universal. For example, Naylor said iVillage’s Horoscope section generates a lot of traffic but doesn’t attract many endemic advertisers. That’s why he turns to networks. According to Pam Horan, president of the Online Publishers Association, most publishers do just that.

I like Mathew Ingram’s nuanced explanation of the ad network vs. no ad network debate, which is, in a nutshell, that sometimes they’re a good thing, and sometimes they’re not. Or rather, that they’re a good thing until they’re not.

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Ask.com: The Algorithm is Not Available Right Now, Please Click an Ad Instead

Written By Sepideh Saremi | March 14, 2008 | Share This |

ask logo

As IAC boss Barry Diller had his day in court yesterday, fighting to split up the various companies under IAC’s umbrella, including Ask.com, we thought it might be relevant to highlight a recent experience one of our managing partners, Peter Hershberg, had with actual Ask.com search results.

A search by Peter for “anatomy of the eye” on Google yesterday yielded an ad touting “the improved Ask.com.” Click the screenshot for a larger image:

image001.jpg

Clicking the ad led him to an Ask.com results page that featured sponsored ads - two of which were about ears and pretty irrelevant. But even weirder was that the page yielded absolutely no organic results:

image002.jpg

Instead, Ask.com said the search for “anatomy of the eye” did not match any Web results.

A search for the same phrase on Google today showed the same ad (see it here), and the Ask.com results page featured some organic listings this time. However, the organic listings were all below the fold, buried under ten sponsored results:

picture-6.png

The search engine has recently stated its intentions to re-strategize (note: it’s not actually going to target moms; the AP was wrong) but it’s a safe bet that serving pages of only results is not part of that strategy…

AOL Buys Social Network Bebo for $850 Million

Written By Sepideh Saremi | March 13, 2008 | Share This |

aol bebo

AOL today announced it is acquiring UK-based Bebo for $850 million. The social network is expected to complement one of AOL’s most popular services, the instant messaging system AIM. From the Bits blog:

As AOL has search for a growth strategy over the last decade, one of the biggest puzzles has been what to do about the AIM system, which allows anyone on any computer to send instant messages, whether they were paying AOL customers or not. Even as AOL’s access service declined, AIM remained the preeminent IM system in the United States, fending off competition from Microsoft, Yahoo, and later Google.

AOL has tried to out social network from AIM, but it was never successful. And Google now integrates AIM in its own chat system, taking advantage of AOL’s network of users. By buying Bebo, AOL now has its own social network which, when married with its robust advertising network (a result of a relatively recent buying spree over the past several months), solidly puts the company in the running with social network behemoths MySpace and Facebook, who are also still figuring out how best to monetize their vast user bases. Bebo has 40 million users worldwide and AOL says it is the third most popular social network in the U.S.

Search Engine Land notes that Yahoo had previously wanted to buy the social network. The company is a search and advertising partner to Bebo and has also been in talks with AOL about the possibility of merger, to avoid an acquisition by Microsoft.

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