Web marketing blog

Threat of recession drives search advertising

2008-05-16T09:39:00.001+10:00

Google has said that the company is witnessing a "significant inflow" of advertising spend from companies who are moving their budgets from mainstream 'above the line' media into more targeted and measurable forms of marketing like PPC advertising.

As reported by The Sydney Morning Herald, there are mixed reports about how the threat of a recession is affecting companies, but this trend does seem to indicate concerns from companies who want to make the most of their advertising spend when budgets are being tightened, either in response or anticipation of a market downturn. In light of this trend, the reported 30% growth in search advertising in Australia for the March quarter could be significantly underestimated.

At the same time as this continued growth in Internet advertising continues, another article in the SMH claims that, dollar for dollar, the Internet accounts for more carbon emissions than any other form of advertising. A study by consultancy P3 estimated the environmental cost of different forms of advertising and claimed that Internet advertising is the equivalent of junk mail, with high levels of water generated by large numbers of page impressions.

Perhaps this is good publicity for the green auditing division of the company publishing the research but it also raises many questions about the methodology of the research.

Google hoping to extend ad deal with Yahoo

2008-05-15T09:33:00.003+10:00

The New York Times reports that Google executives have expressed a desire to develop the advertising relationship with Yahoo! that was tested for several weeks recently with AdWords appearing alongside Yahoo!'s search results. This is partly a move to ward off any possible future attempts by Microsoft to make a bid for Yahoo! but could also be a lucrative development for both Google and Yahoo!

Any arrangement, should it go ahead, would face antitrust investigation in the US due to the dominance of the search advertising market by the two companies. It would also have serious implications for Yahoo!'s own PPC advertising system, which is still struggling to compete against Google, despite a facelift and relaunch in recent years. Such a move would also place even more power within Google's control and advertisers would have even fewer options to place search advertising so that bid rates would continue to rise.

Companies begin to publish negative reviews

2008-05-13T09:11:00.003+10:00

An interesting article from The Boston Globe explains how more companies are starting to embrace the online community and include negative feedback from customers on their websites, as well as positive ones. The main example given is for the Bank of America who have now decided to be open to criticism on their products and services, however harsh it may be.

This trend reflects the growing use of consumer opinion sites, or comments made on discussion forums or blogs. The new attitude of these companies is that it's better to have some awareness and control of these negative comments as well as to balance off all the positive ones that it receives (although of course it's human nature to make complaints rather than pass praise).

Such a move provides a challenge to companies who want to protect their brand and implement reputation management strategies online. It does give them a chance to respond and may well attract more criticism directly to the corporate site rather than through other channels. Of course the same issues remain as always, with the opportunities for competitors to pitch in or for the company to provide their own positive reviews!

Online display advertising rate slows in Australia

2008-05-09T10:07:00.004+10:00

The latest quarterly figures for online advertising spend in Australia have been released by the Interactive Advertising Bureau, using data collected by Pricewaterhouse-Coopers. These show that online display advertising has lost further market share in this sector to classified and search advertising, although the sector as a whole continues to show good growth.

The figures just published for the quarter to March show that the total online advertising market grew by over 30% on the same period last year, up $90.5m to $384.5m. Display advertising's share of this spend fell from 25.5% to 24.6% year-on-year, whereas classifieds grew from 27% to 27.7% and search rose from 47.4% to 47.7% - although this latter sector is still dominated by Google who refuse to reveal actual figures, so this data is based on PwC's estimate.

However, the change in sector share between the March quarter and the previous quarter to the end of December shows that display advertising lost 3 share points while classifieds rose 1.8 points and search by 1.2 share points. This may be indicating the start of a slowdown in online advertising due to possible concerns in an economic slowdown, although overall the market is still growing at a much healthier rate than any other advertising sector.

Google developing Image Search enhancements

2008-05-07T10:51:00.003+10:00

A recent article by The New York Times reports on a research paper presented at the International World Wide Web Conference in Beijing by 2 Google scientists, which described the development of 'VisualRank' by the search engine. This is the prototype algorithm that combines image-recognition software techniques with the methods for weighting and ranking images that look most similar. Described as the equivalent of Google's main PageRank system adapted for digital images, it's being seen as potentially a big step forward for the quality of image searching on the web.

Image search has long been one of the most popular 'vertical' search options on the main search engines and more recently Google, Ask and the others have been 'blending' image results into the main search results list, when relevant, thereby giving image search results far more exposure to mainstream searchers. Up until now, image results are usually generated from information in the file name and surrounding page content, but Google - and others - are working on ways to analyse image form and shape similarities.

The article says that Google has been working on a sample of around 2,000 of the most popular product queries from Google’s product search - so items such as iPod and Xbox - and then sorting the top 10 images both from its main ranking system and the standard Google image search results. Using a team of 150 Google employees, the researchers then created a scoring system for image “relevance”, which is being referred to as VisualRank. The outcome of this development, according to the researchers, was to retrieve new image results that were 83% less irrelevant.

Microsoft pulls out of offer for Yahoo!

2008-05-05T09:12:00.003+10:00

The ongoing saga of Microsoft's attempts to buy Yahoo! came to an abrupt halt on Saturday when a top level meetings between the executives of both companies failed to reach an agreement. Despite Microsoft upping their bid price to nearly US$50bn, Yahoo! still held out their position that the bid was undervaluing the business and so Microsoft finally withdrew their offer.

Shares in Yahoo! fell as news of this development reached the markets, and the question now remains - what will Yahoo! do now? Will they continue to pursue the other business alignments that were being investigated during the takeover offer period, such as with AOL, or try to build on the recent advertising trial with Google?

It's no doubt good news for the web search market that Microsoft hasn't pursued this acquisition to a successful conclusion, but it now leaves Yahoo! in a weaker position from which they need to develop their business and services to help them maintain their position in the market, and to protect themselves from other predatory takeover attempts. Microsoft are also likely to be reviewing the outcome and deciding where to spend their cash now and it may eventually come about that another purchase attempt will be made if Yahoo!'s value takes another hit in the future.

Web marketing newsletter for May published

2008-05-02T09:09:00.004+10:00

The new May issue of the monthly Web Marketing newsletter has been published, covering some of the recent stories on web search and online marketing trends.

This month's edition looks at several pieces of research that have just been published. The first analyses the trend for online shopping in Australia and how growth seems to have halted due to the limitations being set by retailers. The second research report looks at how web searchers are using 'universal' search results on Google and the other main search engines and what this means for search engine marketing campaigns. Finally the newsletter takes a technical look at the issues involved when moving a website to a new hosting location or domain name and what impact this can have on search engine indexing and rankings.

If you want to sign up for future issues of this newsletter, please do so by using the form at the bottom of this page. To view back issues of this newsletter you can see the archive by date or by subject.

Google to be sued for ad fraud

2008-04-30T19:29:00.003+10:00

Google is facing another lawsuit in the US, according to a report by CNet. The claim aims to take a class action status for many affected advertisers and has been filed by the same firm that previously won significant cases against both Yahoo! and Google for click fraud issues. The new claim accuses Google of deceiving its customers into paying for ads they didn't expressly request.

This is based on the sign-up process for a new AdWords account whereby advertisers are automatically included in the 3rd-party content network of adverts (Google AdSense). There is not an obvious opt-out option for this part of the advertising network and advertisers need to enter the campaign settings after the account has been set up in order to deselect this option.

It is likely that Google will need to revise this system in the future to make it more obvious to advertisers what they are selecting and how they can easily opt-out if required. It also seems to be the nature of being a big corporation now that Google will continue to face these types of action whenever a potential failure in their system can be exploited for money.

Yahoo! to embrace social networking

2008-04-28T13:40:00.007+10:00

The New York Times reports that Yahoo! is planning to refocus its website around the growing social networking trends, by adding Web 2.0 applications and allowing registered users to develop their own web pages, add widgets and personalise their experience, including providing the ability to link to friends and track actions and opinions.

The new plans are expected to start appearing before the end of the year, subject to any takeover by Microsoft. As the pressure for the acquisition moves towards the next stage, Yahoo! has been looking for alternative suitors to protect their position (such as AOL) or partners to strengthen their online revenues (such as Google's recent trial of AdWords on Yahoo!). Ultimately, Yahoo! appears to be looking at ways of using the latest Internet trends to increase their opportunities for selling advertising space on their web properties.

Discrepancies in web measurement data

2008-04-24T11:33:00.005+10:00

The Wall Street Journal has provided a good summary of how different web measurement companies produce conflicting figures on website usage and the difficulties this can give to both advertisers and publishers. As it says, the science of tracking Internet usage remains far from perfect due to the different tracking methods and measurement criteria being used.

Advertisers rely on data from companies like comScore and Nielsen Online to determine where to place their adverts, but it has long been known that comparing data between both companies is fraught with problems. In the same way that web analytics software will measure site usage data in different ways, it is better to look at comparative data within the same system, rather than to compare figures between two different methods of data collection.

Both of these leading web measurement companies use panels of online users to collect data and then extrapolate out to the likely universe - in much the same way that TV and radio audience figures are measured - so that the end results are statistical estimates. This means that there can be wide variations when the visitor numbers are in millions, plus both of these US companies lack the capacity to measure total international audiences.

Both comScore and Nielsen Online are attempting to address those shortcomings by looking for ways to increase the size and depth of their panels, investing in technology and expanding overseas. Nielsen is also trying to combine its web research with usage data from other media collected by its parent company, such as mobile-phone and television measures.

However, the current data remains the best there is for advertisers at this stage and therefore a good starting point for media planning. Ultimately their own response data on the ROI of any advertising will provide more meaningful data on how to develop an ongoing campaign.

Online retail not working for Australians

2008-04-21T15:49:00.008+10:00

A recent article by Dynamic Business magazine reports on some surprising research completed by The Leading Edge consultancy in Australia which indicates that the number of online buyers has plateaued. Although the latest figures from the Australian Bureau of Statistics state that 61% of Australians shopped online in the 2006-07, this new research claims that those web users who aren’t currently buying online don’t intend to start.

Part of the reason for this stagnation is reported to be due to poor or unclear return policies by the retailers (47%) or high delivery charges (32%). Australia’s limited Internet capability is also quoted as being an obstacle for users, as well as the online strategies of traditional 'bricks and mortar' retail stores that tend to hinder their own online success.

Unlike retailers in the US and Europe that are embracing the opportunities of selling online, The Leading Edge say that many retailer websites in Australia are little more than online catalogue pages, with limited selling channels that offer few integrated services between existing stores and websites. Ultimately they claim that there is little being offered at the moment to excite shoppers or to give them the confidence to change their current habits and spend more online.

Engagement becomes the new metrics system

2008-04-11T17:20:00.003+10:00

An article by Brand Week outlines the change in online metrics to help measure the success of a marketing campaign, moving away from traditional notion of unique visits and page views and consider the broader notion of 'engagement', particularly in view of the growing importance of social media and networking as a marketing channel.

The report uses recent examples from Procter & Gamble and Dell, where marketing campaigns have been measured in a different way - in P&G's case, their agency was able to track both the initial message sent out as well as subsequent ones through other social networks, so that the viral path from one peer to the next could be tracked indefinitely. A color-coded viral map measured first-time messages consumers sent off the contest site versus those messages that were later passed on from one social network to the next.

This concept is based on the idea that activities undertaken - and the success of a viral marketing campaign for brand building - is more important than direct clicks on a site, or the resulting sales generated (which can be difficult to measure for a FMCG company like Procter & Gamble). The use of widgets can enable companies to track the chain of actions between different users but many marketers and brand managers still see engagement metrics as 'too loose' with few engagement measurements to date leading to sales.

Microsoft's Engagement Mapping service also tries to address this issue by tracking both the last site a consumer clicked on to get to a brand's web page (such as via a banner ad), as well as a history of pages a person has traveled through on which a brand has advertised, prior to landing on that brand's home page. The ultimate goal is to measure how effectively a campaign creates recall for someone.

In Dell's case, the article reports that the company is more concerned with creating and measuring online interactions than with connecting them to sales, with a goal of community involvement by encouraging suggestions on changes that could be made to Dell's products. Ultimately the company wants to build a sense of trust with consumers, so that they return frequently to the brand's website.

Search behaviour and 'universal' search results

2008-04-09T19:29:00.004+10:00

A new research report by iProspect in the US has been reported by Media Week and it seems to show that most web users still tend to prefer making general web searches, rather than use the specialised 'vertical' search options, such as news, images or blogs. However, reflecting the more recent move by the search engines to present 'universal' or 'blended' search results, the study did find that these searchers are responsive to search results that now display multiple forms of results in one place, including text, video, images and news.

The research reports that only 17% of users who conduct a news-specific search actually click on a result, while 36 % of users click on news results that appear within general searches. In a similar way, 26% of users find satisfactory results when conducting an image-specific search, while 31% click on image results within general search results and for video there was also a similar pattern (10% versus 17%).

The report concludes that this trend is due to a common “aversion to vertical search” (or perhaps an unfamiliarity with these options) among web users. However, following the introduction of Ask's combined search results and Google’s launch of “universal search” in 2007, more web users are becoming familiar with the combined search results and are therefore becoming more familiar with these options.

This will therefore strengthen the role of universal search and highlights the need for business websites to consider how they can optimise for all the different search results that may be presented. However, as iProspect also point out, vertical search also still exists as an option and companies shouldn't ignore the need to optimise for these results as well since they can be more focused and less 'cluttered' (and competitive) than the main search results list.

Cost of Internet crime in the US hits $240m

2008-04-07T10:21:00.003+10:00

The Associated Press provides details on a new Government report from the US which says that the cost of Internet-related crime hit a new high in 2007, reaching about $240 million. The data, published by the FBI and the National White Collar Crime Center reveals that the number of reported Internet scams dropped slightly from previous years, but the total lost jumped $40 million.

The data also shows that men lost more than women on average ($765 compared to $552 for women) and that older people were also prone to lose more, with victims in their 20s losing $385 on average while people over 60 reportedly lost an average $760 per scam. The most common crime reported was auction fraud, followed by the non-delivery of a purchased goods and then confidence fraud, in which scammers ask consumers to rely on them, resulting in a financial loss. About half the losses involved amounts less than $1,000 and one-third involved amounts between $1,000 and $5,000.

Google implements job cuts

2008-04-04T14:28:00.002+11:00

Google has announced their first sizeable jobs cuts in their short corporate history with a reported 300 positions to be axed. However, as the New York Times reports, the expected reduction of jobs comes as a result of the DoubleClick acquisition and the much expected rationalisation in staff numbers. However, these numbers are higher than forecast and represent about a quarter of the total US workforce at DoubleClick, plus further cuts are expected in the overseas offices as well.

There are also reports that Google will sell off the Performics part of the DoubleClick business, since this search engine marketing firm would have a clear conflict of interest with Google's search engine results.

Yahoo! partners with Click Forensics

2008-04-03T11:31:00.003+11:00

In a surprise announcement on the Yahoo! Search Marketing blog, Yahoo! have revealed that they are creating a partnership with Click Forensics to tackle the thorny issue of click fraud within PPC advertising campaigns. This is quite an unusual move since both Yahoo! and Google have disagreed with the data published by the click auditing company, Click Forensics, due to differences of opinion about the definition and measurement of the data.

Now Yahoo! has taken a positive move to work with Click Forensics in a way that should benefit the PPC market as a whole. Yahoo! say that Click Forensics will act as an intermediary for advertisers and cooperate on specific advertiser issues when advertisers request help about potential click fraud events. Click Forensics will be able to provide Yahoo! with more information on behalf of the advertiser if there is a question about traffic quality, as well as any additional data that may help Yahoo! to update their traffic-quality measures.

There are likely to be some conflicts of interest in this arrangement, but a more open partnership between the 2 companies should be welcomed. Yahoo! have also announced that they will be make a Click Filter report available to advertisers, showing the number and percentage of clicks that have been discarded as 'fraudulent' - much the same as the report option currently available through Google AdWords.

Web marketing newsletter for April published

2008-04-01T11:33:00.002+11:00

The April issue of our monthly newsletter covering some of the recent stories on web search and marketing trends has been published. This month's edition looks at the issue of improving web page load times, which will become an important factor for some Google AdWords advertisers since this element is now being included with the 'Quality Score' formula to determine advert rankings. It also looks at the process of creating weblinks and how the 'nofollow' attribute can have an influence on this process - and why it was introduced in the first place. Finally, following the completion of Google's acquisition of DoubleClick, the newsletter considers what this means for the combined business and the online advertising sector as a whole.

If you want to sign up for future issues of this newsletter, please do so by using the form at the bottom of this page. To view back issues of this newsletter you can see the archive by date or by subject.

More about widgets

2008-03-28T14:48:00.002+11:00

Following the post earlier this month which reported on the counter arguments for and against the use of widgets as a marketing tool, ClickZ published an article earlier this week with examples of how big brand companies have been using widgets and the challenges facing companies to make these small applications as success in the face of many now being available online.

The article also points out that, although some widget applications can be expensive to develop, cost shouldn't be the core factor and more important will be the idea and tailoring this concept to a company's own target audience. Widgets can serve a variety of marketing objectives, from site traffic and lead generation to awareness building. A number of recommended best practices that are listed include keeping ads under 40K size, limiting any animation to under 15 seconds, creating an easy-to-click outgoing link, and underlining the link so it stands out.

Which way now for social networking?

2008-03-27T14:48:00.003+11:00

As would be expected from The Economist, a recent article reviewing the current position and future opportunities for social networking sites provides an intelligent and perceptive assessment of this latest online trend, prompted by AOL's recent acquisition of Bebo, the 3rd largest social networking site.

It compares the development of social networking sites now with the advent of online email services a decade ago, and concludes that, although both provide an excellent utility that attracts millions of regular users, the opportunities for direct 'monetisation' may be more limited. The article also considers how the current format of social network sites is 'closed' to the outside web but that future developments are expected to make these more integrated with other online activities and so become a more powerful and effective utility for web users, whether or not they end up making the type of revenue expected from the current valuations of these companies.

From an alternative perspective, AdWeek reviews the growing activity of 'conversational marketing' through social networking sites and the difficulties currently faced by advertisers with how to measure the success of their campaigns. There are few accepted metrics in place to measure the 'success' of social media marketing and some advertisers feel that the way these sites are used lend themselves to less effective brand building through banner advertising.

Google AdWords introduces demographic bidding

2008-03-25T14:41:00.002+11:00

The Google AdWords blog has just announced the introduction of demographic bidding within the AdWords campaign - or to be more specific, this bidding option is available within the content targeted network and only for those sites where data exists to be able to offer this facility (such as MySpace, Friendster and others). All user data from these sites has been aggregated so that user privacy is protected.

This is a move that has been expected since Microsoft launched their adCenter PPC service in the US, which contained the option for demographic targeting by using data from Microsoft's network of online services. However, although Google was expected to introduce such an option themselves, their access to this level of user data has been more limited, so this introduction of bidding controls within the content targeted network is a good start.

It also helps to provide a further level of management within the third-party content network and should be a useful feature for advertisers who also have an understanding of the demographics of their customer base and target market.

7 tips for bloggers

2008-03-25T12:46:00.003+11:00

The New York Times recently published an article providing a number of tips for aspiring bloggers - whether business or social. Although there are plenty of websites and resources offering lists of tips on making blogging work, this list stands out as it offers some realistic and practical advice.

What it also states is that time can become one of the main factors in developing a blog - firstly from finding the time to post entries on a regular basis and then, should it become successful, having the time or resources to maintain and develop the blog, including moderating or responding to comments. Before even starting out with a blog, be clear on the objectives and don't lose sight of that, even when the blog begins to take on a life of its own!

Google confident of tackling a recession

2008-03-20T15:13:00.003+11:00

Google's CEO Eric Schmidt has made a short visit to Australia and has said that the company has few concerns about the slowdown in the world economy and any recession which may affect the US and other leading economies.

As reported by the Sydney Morning Herald, Schmidt says that Google is well prepared for a recession and, since advertisers favour media where results can be tracked more easily when budgets are tightened, the search engine will continue to capture a greater share of the $1.3 billion online advertising market in Australia.

Google is also expecting to take a greater share of the display advertising market, following the completion of their year-long acquisition of DoubleClick. By combining the techniques from their search technology with the networks and applications provided by DoubleClick, Google is likely to develop new advertising opportunities that will link banner and video advertising with search queries to improve targeting and the effectiveness of online spend.

Gender trends in online shopping

2008-03-19T09:20:00.003+11:00

The Wall Street Journal reports that luxury retailers are finding that men make faster shopping decisions, spend more on luxury items online and are less likely to return unwanted items than women. As a result, these surprising results mean that some leading retailers are streamlining their e-commerce sites to enhance their appeal to men, who reportedly prefer to shop quickly, without doing much comparative research.

The study by Forrester Research seems to indicate that men may value their time more, or want to make decisions quicker without shopping around. They also estimate that men send back fewer than 10% of their apparel purchases, while women return more than 20% of the apparel they purchase.

The article also includes data from other retailing studies in the US and Europe which are showing different shopping patterns between the sexes and how some retailers are now developing their websites and product offerings to take advantage of these trends.

Google completes their DoubleClick acquisition

2008-03-17T16:41:00.003+11:00

Following the recent clearance by the European Commission to allow Google's acquisition of DoubleClick to proceed in Europe, Google has now cleared all the major hurdles in the takeover plan and the deal is now finalised. Now Google will need to begin the hard work of making the deal work, by combining the advertiser services into an integrated package and pushing new products into the market.

An article by Business Week sets out the implications for the online advertising market and how display advertising is expected to see a resurgence as new targeting tools and analytics enable advertisers to make better use of this medium.

The move also provides another setback for Microsoft and may precipitate a more urgent attempt to buy Yahoo! so that they can strengthen their position within the search market and avoid losing share in the display advertising sector. In a new move, AdWeek reports that Microsoft have just purchased Rapt, a company that enables advertisers to manage their online ad inventory - a further sign that this sector will become a new battleground between the two search rivals.

Google adds page load times into Quality Score

2008-03-11T10:48:00.002+11:00

The Google AdWords blog has announced that they will be extending the Quality Score feature of AdWords to incorporate landing page load times.

The Quality Score is the dynamic variable that Google calculates for each keyword used by an advertiser to determine where an advert will be displayed in the rankings, based on relevancy, clickthrough rate and other factors. By including the new factor of load time for a landing page, Google is giving advertisers another factor that should be considered as a potential way of improving the ad rank at a lower cost, so therefore it could be another factor in improving the ROI of a campaign.

Load time is the length of time it takes for a page to load in the browser, so it can be dependent on the size of the page, the text content, images and underlying page code. Google says that a faster loading page creates a better experience for users, and therefore pages that take longer to load will be penalised as part of the Quality Score ranking criteria.