Sunday, December 04, 2005

Drinking the Google Kool Aid?

Sure, I like Google a LOT .... but Gooogle Golly Gee ....

I'm getting tired of people explaining how Google will take over the internet and then the world of commerce. This is the nonsense we heard back in 1999....except they were saying AMAZON was going to take over the world.

What's Amazon? Oh... right.... it's a book selling site.

True, Google's innovations are far more profound, their people are brilliant, and they have approached things in incredibly innovative ways. But there is a challenge for Google that is rarely discussed even though it's the most significant thing about the company:

Almost ALL of THEIR MONEY comes from ADVERTISING!

Google-y eyed analysis seems to miss the fact that Google is not making money because they are profoundly innovative in search and internet, they are making money because they came online at the right time with the best search to date. They combined this with the brilliancy of contextual advertising invented more by Bill Gross of Overture than Google. Read "The Search" by John Battelle for this interesting story as well as a great history of search with a strong emphasis on Google.

With Yahoo now equal in search quality and MSN and AskJeeves equal within months or a year at most, the division of advertising revenues will challenge Google, making it hard to grow faster than the rate offline advertising money pours online.

Sure they are GREAT, but the key questions relate to how they adapt to the ever changing marketplace as much as the ever changing search landscape.

JoeDuck's Blog

9 Comments:

Anonymous Anonymous said...

> They combined this with the brilliancy of contextual advertising invented more by Bill Gross of Overture than Google.

Remember, they bought the company that rolled out the adsense technology. I think that says something about Google: They capitalize. Invent all you want...

> With Yahoo now equal in search quality and MSN and AskJeeves equal within months or a year at most, the division of advertising revenues will challenge Google

This is simply not true. Nobody I know will pay the same until those groups get the same amount of traffic as GOOG, plain and simple. Less eyeballs means less clicks therefore a far smaller adspend, or could simply mean that it's not even worth going for that market (why bother advertising on Yahoo!, worrying about optimizing your keywords/phrases and conversions etc for 10 clickthrus a day when you get 500 on Google?)

Thursday, December 08, 2005 1:38:00 AM  
Anonymous Anonymous said...

>why bother advertising on Yahoo!, worrying >about optimizing your keywords/phrases and >conversions etc for 10 clickthrus a day when >you get 500 on Google?

You must not have much background in the world of advertising to make a statement like that. If you only get 10 clickthrus per day on Yahoo, but 8 of those ten end up in sales, Yahoo was very valuable to you. Now say that Google sends you 500 clickthrus, but only 5 ended up in sales, obviously your money was better spent at Yahoo in this case.

The point you should take from this is not that Yahoo or Google will necessarily be better for everything, but the fact that "quantity" of referrals isn't as important as "quality" of referrals.

Thursday, December 08, 2005 8:55:00 AM  
Blogger JoeDuck said...

>Nobody I know will pay the same until those groups get the same amount of traffic as GOOG.

I think they are in the minority. I advertise on both, and all I really care about is the bid price and the conversion. 10 vs 500 clicks sounds like you are not bidding the same since Yahoo gets about 1/2 the searches of Google, though I'm not sure if click throughs compare in that fashion.

Thursday, December 08, 2005 9:08:00 AM  
Anonymous Anonymous said...

This just in from littlesquare.com blog:

[Amazon]

Adam@littlesquare.com: I would argue it’s not just a book selling site, it’s the book selling site. When I want to buy I book, I’ll always buy from them. I’ve had good experiences with Amazon in the past and I see no reason the change my buying habits.

I don’t know how many others share the same belief, but I’m probably not in the minority.

JoeDuck: With Yahoo now equal in search quality ....

Adam: Likewise with search, when I want to do a search, I’ll always do it in Google and it’s going to take a lot to get me to change. I’m not really a person who runs the search first in google and than runs the same search in msn/yahoo. If I don’t find what I need in Google, I move on and/or re-search with a more exact/broad search query.

I haven’t really dealved much into the localized aspects of each search engine but I do see that as a potentially differentiating quality. It’s still relatively new and seemingly a good source of innovation.

Thursday, December 08, 2005 9:24:00 AM  
Blogger JoeDuck said...

To Adam@littlesquare.com:

Good points both, but you are missing they key factor which is that advertising revenues are driving Google’s success and Google’s market share is more likely to go down than up due to increasing competition in the space.

I’m not DOWN on Google - I just think the other players are catching up to them and nobody is talking much about that. It’s all good in terms of users (better searcch), publishers (adsense shares will tend to go up), and spreading good American cheer throughout the world.

JoeDuck

Thursday, December 08, 2005 9:26:00 AM  
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Friday, December 23, 2005 5:23:00 AM  
Blogger alextewnewsite said...

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Sunday, December 25, 2005 7:00:00 AM  
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