Octavianworld

Analyzing #Analytics

Take a look at this chart:

Here's what I see:

• interest bumping along to '06
• growing interest through '08 (Competing on Analytics appears March 2007)
• hype-y growth in interest through '10
• wildly uneven interest so far this year
• growing interest in the early part of each year
• summer "blahs" (Who Googles "analytics" on the beach? Don't answer that...)
• bump in interest in the fall, when business plans featuring "analytics" are developed and presented
• quiet Decembers

What do you see?  Are we watching "analytics" jump the shark?  More likely, we've chowed down on it as much as we can, and are now digesting.  Further interest will likely be less at the general conceptual level, and more at the "how do I get there" level.  Hence "Pragmalytics" (Part II here).

Stay tuned for more.

#Google Search and The Limits of #Location

I broke my own rule earlier today and twitched (that's tweeted+*itched -- you read it here first) an impulsive complaint about how Google does not allow you to opt out of having it consider your location as a relevance factor in the search results it offers you:

I don't take it back.  But, I do think I owe a constructive suggestion for how this could be done, in a way that doesn't compromise the business logic I infer behind this regrettable choice.  Plus, I'll lay out what I infer this logic to be, and the drivers for it, in the hope that someone can improve my understanding.  Finally, I'll lay out some possible options for SEO in an ever-more-local digital business context.

OK, first, here's the problem.  In one client situation I'm involved with, we're designing an online strategy with SEO as a central objective.  There are a number of themes we're trying to optimize for.  One way you improve SEO is to identify the folks who rank / index highly on terms you care about, and cultivate a mutually valuable relationship in which they eventually may link to relevant content you have on a target theme.  To get a clean look at who indexes well on a particular theme and related terms, you can de-personalize your search.  You do this with a little url surgery:

Start with the search query:

http://www.google.com/search?q=[theme]

Then graft on a little string to depersonalize the query:

http://www.google.com/search?q=[theme]&pws=0

Now, when I did this, I noticed that Google was still showing me local results.  These usually seem less intrusive.  But now, like some invasive weed, they'd choked off my results, ranging all the way to the third position and clogging up most of the rest of the first page, for a relatively innocuous term ("law"; lots of local law firms, I guess).  

Then I realized that "&pws=0" tells Google to stop rummaging around in the cookies it's set on my browser, plus other information in my http requests, and won't help me prevent Google guessing / using my location, since that's based on the location of the ISP's router between my computer and the Google cloud.

 Annoyed, I poked around to see what else I could do about it.  Midway down the left-hand margin of the search results page, I noticed this:

 

So naturally, my first thought was to specify "none", or "null", to see if I could turn this off.  No joy. 

Next, some homework to see if there's some way to configure my way out of this.  That led me to Rishi's post (see the third answer, dated 12/2/2010, to the question).  

Unbelieving that an organization with as fantastic a UI aesthetic -- that is to say, functional / usable in the extreme -- as Google would do this, I probed further. 

First stop: Web Search Help.  The critical part:

Q. Can I turn off location-based customization?

A. The customization of search results based on location is an important component of a consistent, high-quality search experience. Therefore, we haven't provided a way to turn off location customization, although we've made it easy for you to set your own location or to customize using a general location as broad as the country that matches your local domain...

Ah, so, "It's a feature, not a bug." :-)

...If you find that your results for a particular search are more local than what you're looking for, you can set your location to a broader geographical area (such as a country instead of a city, zip code, or street address). Please note that this will greatly reduce the amount of locally relevant results that you’ll see. [emphasis mine]

 Exactly!  So I tried to game the system:

Drat!  Foiled again.  Ironic, this "Location not recognized" -- from the people who bring us Google Earth!

Surely, I thought, some careful consideration must have gone into turning the Greatest Tool The World Has Ever Known into the local Yellow Pages.  So, I checked the Google blog.  A quick search there for "location", and presto, this. Note that at this point, February 26, 2010, it was still something you could add.  

Later, on October 18, 2010 -- where I have I been? -- this, which effectively makes "search nearby" non-optional:

We’ve always focused on offering people the most relevant results. Location is one important factor we’ve used for many years to customize the information that you find. For example, if you’re searching for great restaurants, you probably want to find ones near you, so we use location information to show you places nearby.

Today we’re moving your location setting to the left-hand panel of the results page to make it easier for you to see and control your preferences. With this new display you’re still getting the same locally relevant results as before, but now it’s much easier for you to see your location setting and make changes to it.

(BTW, is it just me, or is every Google product manager a farmer's-market-shopping, restaurant-hopping foodie?  Just sayin'... but I seriously wonder how much designers' own demographic biases end up influencing assumptions about users' needs and product execution.)

Now, why would Google care so much about "local" all of a sudden?  Is it because Marissa Mayer now carries a torch for location (and Foursquare especially)?  Maybe.  But it's also a pretty good bet that it's at least partly about the Benjamins.  From the February Google post, a link to a helpful post on SocialBeat, with some interesting snippets: 

"Location may get a central place in Google’s web search redesign"

Google has factored location into search results for awhile without explicitly telling the user that the company knows their whereabouts. It recently launched ‘Nearby’ search in February, returning results from local venues overlaid on top of a map.

Other companies also use your IP address to send you location-specific content. Facebook has long served location-sensitive advertising on its website while Twitter recently launched a feature letting users geotag where they are directly from the site. [emphasis mine]

Facebook's stolen a march on Google in the social realm (everywhere but Orkut-crazed Brazil; go figure).  Twitter's done the same to Google on the real-time front.  Now, Groupon's pay-only-for-real-sales-and-then-only-if-the-volumes-justify-the-discount threatens the down-market end of Google's pay-per-click business with a better mousetrap, from the small biz perspective.  (BTW, that's why Groupon's worth $6 billion all of a sudden.)  All of these have increasingly (and in Groupon's case, dominantly) local angles  where the value to both advertiser and publisher (Facebook / Twitter / Groupon) are presumably highest.

Ergo, Google gets more local.  But that's just playing defense, and Eric, Sergey, Larry, and Marissa are too smart (and, with $33 billion in cash on hand, too rich) to do just that.

Enter Android.  Hmm.  Just passed Apple's iOS and now is running the table in the mobile operating system market share game.  Why wouldn't I tune my search engine to emphasize local search results, if more and more of the searches are coming from mobile devices, and especially ones running my OS?  Yes, it's an open system, but surely dominating it at multiple layers means I can squeeze out more "rent", as the economists say?

The transcript of Google's Q3 earnings call is worth a read.

Now, back to my little problem.  What could Google do that would still serve its objective of global domination through local search optimization, while satisfying my nerdy need for "de-localized" results?  The answer's already outlined above -- just let me type in "world", and recognize it for the pathetic niche plea that it is.  Most folks will never do this, and this blog's not a bully-enough pulpit to change that. Yet.

The bigger question, though, is how to do SEO in a world where it's all location, location, location, or as SEOmoz writes

"Is Every Query Local Now?" 

Location-based results raise political debates, such as "this candidate is great" showing up as the result in one location while "this candidate is evil" in another.  Location-based queries may increase this debate.  I need only type in a candidate's name and Instant will tell me what is the prevailing opinion in my area.  I may not know if that area is the size of a city block or the entire world, but if I am easily influenced then the effect of the popular opinion has taken one step closer (from search result to search query) to the root of thought.   The philosphers among you can debate whether or not the words change the very nature of ideas.

Heavy.

OK, never leave without a recommendation.  Here are two:

First, consider that for any given theme, some keywords might be more "local" than others.  Under the theme "Law", the keyword "law" will dredge up a bunch of local law firms.  But another keyword, say "legal theory", is less likely to have that effect (until discussing that topic in local indie coffee shops becomes popular, anyway).  So you might explore re-optimizing for these less-local alternatives.  (Here's an idea: some enterprising young SEO expert might build a web service that would, for any "richly local" keyword, suggest less-local alternatives from a crowd-sourced database compiled by angry folks like me.  Sort of a "de-localization thesaurus".  Then, eventually, sell it to a big ad agency holding company.)

Second, as location kudzu crawls its way up Google's search results, there's another phenomenon happening in parallel.  These days, for virtually any major topic, the Wikipedia entry for it sits at or near the top of Google's results.  So, if as with politics, now too search and SEO are local, and much harder therefore to play, why not shift your optimization efforts to the place that the odds-on top Google result will take you, if theme leadership is a strategic objective?

 

PS Google I still love you.  Especially because you know where I am. 

 

Google Buzz: Right On Schedule

As reported in Mediapost today.  Here's my New Year's Day post on Google Wave, predicting what they're calling Buzz.  Interesting, bit not surprising -- no FB integration. 

Ecommerce On The Edge In 2010 #MITX

Yesterday morning I attended MITX's "What's Next For E-Commerce" Panel at Microsoft in Cambridge.  Flybridge Capital's Jeff Bussgang moderated a panel that included Shoebuy.com CEO Scott Savitz, CSN CEO Niraj Shah, Mall Networks CEO Tom Beecher,and Avenue 100 Media Solutions CEO Brian Eberman.

The session was well-attended and the panelists didn't disappoint. Across the board they provided a consistent cross-section of the sophistication and energy that characterizes life 2 SDs the right on the ecommerce success curve.

My notes and observations follow. But first, courtesy of Jeff, a quiz (answers at the end of the post):

1. Name the person, company, and city that originated the web-based shopping cart and secure payment process?

2. Name the person, company, and city that originated affiliate marketing on the web?

3. Name the largest email marketing firm in the world, and the city where it's headquartered?

Jeff opened by asking each of the panelists to talk about how they drive traffic, and how they try to distinguish themselves in doing so.

Brian described (my version) what his firm does as "performance marketing in the long tail", historically for education-sector customers (for- and non-profit) but now beyond that category. What that means is that they manage bidding and creative for 2 million less-popular keywords across all the major search engines for their customers. Their business is entirely automated and uses sophisticated models to predict when a customer should be willing to pay price X and use creative Y for keyword Z to reel in a likely-profitable order. The idea is that the boom in SEM demand has driven prices way up for popular keywords, but that there are still efficient marketing deals to be mined in the "long tail" of keyword popularity (e.g.,structured collaboration").

Niraj noted that there's an increasing returns dynamic in the SEM channel that raises entry barriers for upstarts and helps firms like CSN preserve and expand their position.  Namely, as firms like his get more sophisticated about conversion through scale and experience, they can afford to pay higher prices for a given keyword than smaller competitors can, and can reinvest in extending their SEM capabilities.  CSN now has a 10-person search marketing team within its total staff of 500. Since SEM is, to some degree, a jump-starter for firms that don't yet have a web presence sufficient to drive traffic organically, this edge is a powerful competitive weapon.  CSN is up to $200 million in annual revenues, and now manages the online furniture stores for folks like Walmart.

Scott sounded a different note, with similar results.  Shoebuy has focused more on cultivating its relationship with its existing customers and on Lifetime Value -- including referrals.  This focus has had a salutary effect on SEO, allowing them to rely less on SEM as it gets pricier.  Last year Shoebuy experienced double-digit top line growth and hit 8M uniques for December's shopping season, while realizing its lowest marketing expense as a percentage of sales since 2002.  They've continued to plow the savings into a better overall customer experience.  One way Shoebuy guides this reinvestment is through extensive use of Net Promoter-based surveys.  They keep the surveys brutally simple:  1)"Were you satisfied?" 2)"Whould you shop with us again?" 3)"Would you recommend us?".  Then they calculate the resulting NP scores to different things they try in their marketing mix, to give them a more nuanced insight than the binary outcome of an order can provide.

Tom described how while Mall Networks' traffic is "free" -- it all comes from their loyalty program partners' sites (e.g. Delta Skymiles website awards redemption page) -- they still have to jockey for Mall Networks' placement on those pages. (Though Tom was too polite to say so, the processes for deciding who goes where on popular pages is often a blood sport and ripe in most organizations for a more structured, rational approach.)

Former Molecular founder and CEO Ralph Folz asked about display -- is that making a comeback?  Brian indicated the lack of performance and the lack of placement control through ad networks made that a highly negative experience.  He did note that they are now experimenting with participation in real-time-bidding through ad exchanges for inventory that ad networks make available, sometimes for time windows only a hundred milliseconds long.  Jeff reinforced the emergence of "RTB" and mentioned MIT Prof. Ed Crawley's Cambridge-based DataXu (which Flybridge has invested in) as a leader in the field.

Affiliate marketing came up next.  Tom explained the basics (in response to a question): each of the 600 stores in Mall Networks stable pays Mall Networks, say for example, a 10% commission on orders that come through Mall Networks.  Mall Networks gives a chunk to the members of various loyalty programs that shop through it -- say 3-5% of the value of the order; some goes to the loyalty programs themselves, as partial inducements for sending traffic to Mall Networks, and the rest goes to Mall Networks to cover costs and yield profits.

All the other panelists include affiliates in their marketing mix, and all appeared satisfied to have them play a healthy role.  Niraj specifically mentioned the ShareASale and Google Affiliate networks.  Jeff asked about everyone's frenemy Amazon; the answers were uniformly respectful: "they're a tough competitor, but they build general confidence and familiarity with the ecommerce channel, and that's good for everyone."  Niraj noted the 800 lb. gorilla nature of their category dominance: "They're at $20m and NewEgg is the next biggest pure play at $2B.  They're a fact of life. We just have to be better at what we focus on."

Someone in the audience raised email.  All of the panelists use it, with lists ranging from millions to hundreds of millions of recipients in size.  They noted that this traditional pillar of online marketing has now gotten very sophisticated.  In their world, they look well beyond top line metrics like open- and clickthrough rates to root-cause analysis of segment-based performance.  Re-targeting came up, and Niraj noted that for them, email and re-targeting weren't substitutes (as some have seen them) but in fact played complementary roles in their mix.  (Jeff explained re-targeting for the audience: using an ad network to cookie visitors to your site, and then serving them "please come back!" ads on other sites in the network they go to after they've abandoned a shopping cart or otherwise left your site.  A twist: serving ads inviting them to *your* site after they've abandoned one of your competitors' sites.  Hey, all's fair in love, war, and ecommerce...).  A common theme:  unlike most of the rest of the world, email teams at these leading firms are tightly integrated with other channels' operators to better integrate the overall experience, even to the point of shared metrics.

What about social?  Scott: "Building community is key for us.  We run contests -- "What are you hoping will be under your tree this Christmas?" -- to stimulate input from our customers.  And, while we have social media coordinators, many people here participate in channels like Twitter in support of our efforts."  Niraj: "Our PR team came up with a 'Living Room Rescue' contest which we did in partnership with [a popular] HGTV host [whose name escaped me -- C.B.].  We got six thousand entries; we used a panel of professional decorators to narrow the list to a hundred, and then used social voting to choose a winner.  We publicized the contest, and it took on a life of its own, as local papers tried to drum up support for their local [slobs -- my word, not Niraj's].  While we couldn't / didn't measure conversion directly from this campaign, our indirect assessment was that it had a great ROI."  Jeff observed that social's potential seems greater when the object of the buzz is newsworthy.

It was a short leap from this to a question about attribution analysis, the simultaneous-dream-and-nightmare-du-jour for web analytics geeks out there.  Brian was surprisingly dismissive.  In his experience (if I understood correctly), he's seeing only up to 20%, and usually only 5-10% of order-placing customers touch two or more properties they source clicks from, across the broad landscape they cover, across a time frame ranging from a day to a month long.  "In the end, only a couple of dollars would shift from one channel to another if we did attribution analysis, so in general it's not worth it."  We chatted briefly after the panel about this; there are large ticket, high-margin exceptions to this rule (cars).  I need to learn about this one some more, it surprised me.

Mobile!  Is it finally here?  Scott reports that 6-9 months ago *customers* finally began asking for it (as opposed to having it pushed by vendors), so now they have a Shoebuy.com iPhone app.  Jeff noted that customers are rolling their own mobile strategies -- some folks are now going into (say) Best Buy, having a look at products in the flesh, then checking Amazon for the items and buying them through their iPhone if the price is right.  So, your store is now Amazon's showroom.  If you can't find something, or didn't even know you wanted it, but happen to stray near a store carrying it, location-based services will push offers at you -- and the offers may come from competitors.  (Gratuitous told-you-so here.)  Niraj:  "Say you're in Home Depot.  You want a mailbox.  Their selection is 'limited' [his description was more colorful]. We have 300 to choose from.  Wouldn't you want to know that?" Jeff:  Soon we'll also see the death of the checkout line: you'll take a picture of the barcode on the object of your desire, your smartphone will tell the store's POS system about it, and the POS system will send back a digital receipt you can show someone (or in the future, something) on your way out of the store. 

With all these channels in use, I asked how often they make decisions to reallocate investments across (as opposed to within) them -- say from search to email, as opposed to from keyword to keyword.  Brian: "Every day, each morning.  Some things -- like affiliate relationships -- may take 3-4 days to unwind.  But the optimization is basically non-stop."  Later we talked about the parallels with Wall Street trading floors.  For him, the analogy is apt.  Effectively he's a market-maker, only the securities are clicks, not stocks.  It's now reflected in their recruiting: many recent hires are former Wall Street quants.

A final note: The cultures in these shops are intensely customer-focused, flat, and data-driven.  Scott reads *every one* of the hundreds of thousands (yes you read right) of customer survey responses Shoebuy gets each year.  He also described the enthusiasm with which their customer service team embraced having all company communications to customers end with an invitation to email senior management with any concerns.  Niraj described CSN's floor plan:  500 people, no offices.  Everyone in the company takes a regular turn in customer service.  Everyone has access to the firm's data warehouse.  Brian told us about a digital display they have up in their offices showing hour-by-hour, source-by-source performance.  They also recently ran a "Query Day" in which everyone in the company -- including sales, finance, HR -- got training in how to use their databases to answer business questions.  Tom described that they “watch the cash register every minute, hour, day during the Christmas shopping season.”

This was a terrific session, and I've only captured half of it here.  Further comments / corrections / observations very welcome.

Quiz Answers:

1. MIT Prof. David K. Gifford, Open Market, Cambridge

2. Tom Gerace, BeFree, Cambridge

3. Constant Contact, Waltham

Grokking Google Wave: The Homeland Security Use Case (And Why You Should Care)

A few people asked me recently what I thought of Google Wave.  Like others, I've struggled to answer this.

In the past few days I've been following the news about the failed attempt to blow up Northwest 253 on Christmas Day, and the finger-pointing among various agencies that's followed it.  More particularly, I've been thinking less about whose fault it is and more about how social media / collaboration tools might be applied to reduce the chance of a Missed Connection like this.

A lot of the comments by folks in these agencies went something like, "Well, they didn't tell us that they knew X," or "We didn't think we needed to pass this information on."  What most of these comments have in common is that they're rooted in a model of person-to-person (or point-to-point) communication, which creates the possibility that one might "be left out of the loop" or "not get the memo".

For me, this created a helpful context for understanding how Google Wave is different from email and IM, and why the difference is important.  Google Wave's issue isn't that the fundamental concept's not a good idea.  It is.  Rather, its problem is that it's paradigmatically foreign to how most people (excepting the wikifringe) still think.

Put simply, Google Wave makes conversations ("Waves") primary, and who's participating secondary.  Email, in contrast, makes participants primary, and the subjects of conversations secondary.  In Google Wave, with the right permissions, folks can opt into reading and participating in conversations, and they can invite others.  The onus for awareness shifts from the initiator of a conversation to folks who have the permission and responsibility to be aware of the conversation.  (Here's a good video from the Wave team that explains the difference right up front.)  If the conversation about Mr. Abdulmutallab's activities had been primary, the focus today would be about who read the memo, rather than who got it.  That would be good.  I'd rather we had a filtering problem than an information access / integration problem.

You may well ask, "Isn't the emperor scantily clad -- how is this different from a threaded bboard?"  Great question.   One answer might be that "Bboards typically exist either independently, or as features of separate purpose-specific web sites.  Google Wave is to threaded bboard discussions as Google Reader is to RSS feeds -- a site-independent conversation aggregator, just as Google Reader is a site-independent content aggregator."   Nice!  Almost: one problem of course is that Google Wave today only supports conversations that start natively in Google Wave.  And, of course, that you can (sometimes) subscribe to RSS feeds of bboard posts, as in Google Groups, or by following conversations by subscribing to RSS feeds for Twitter hashtags.  Another question: "How is Google Wave different from chat rooms?"  In general, most chats are more evanescent, while Waves appear (to me) to support both synchronous chat and asynchronous exchanges equally well.

Now the Big Question: "Why should I care?  No one is using Google Wave anyway."  True (only 1 million invitation-only beta accounts as of mid-November, active number unknown) -- but at least 146 million people use Gmail.  Others already expect Google Wave eventually will be introduced as a feature for Gmail: instead of / in addition to sending a message, you'll be able to start a "Wave".  It's one of the top requests for the Wave team.  (Gmail already approximates Wave by organizing its list of messages into threads, and by supporting labeling and filtering.)  Facebook, with groups and fan pages, appears to have stolen a march on Google for now, but for the vast bulk of the world that still lives in email, it's clunky to switch back and forth.  The killer social media / collaboration app is one that tightly integrates conversations and collaboration with messaging, and the prospect of Google-Wave-in-Gmail is the closest solution with any realistic adoption prospects that I can imagine right now.

So while it's absurdly early, marketers, you read it here first: Sponsored Google Waves :-)  And for you developers, it's not too early to get started hacking the Google Wave API and planning how to monetize your apps.

Oh, and Happy New Year!

Postscript: It was the software's fault...

Postscript #2: Beware the echo chamber

Twitter Idea Of The Day

I just read Clive Owen's piece in on wired.com describing the rise of search engines focused on real-time trend monitoring, as opposed to indexing based on authority.  It's good, short, and I recommend it.

Building on ideas I had a while back, it provoked an idea for a web service that would allow a group sponsor to register Twitter feeds (or, for that matter, any kind of feed) from members of the group, do a word-frequency analysis on those feeds (with appropriate filters of course), and then display snapshots (perhaps with a word cloud) of popularity, and trend analysis (fastest-rising, fastest-falling).  You could also have specialized content variants: most popular URLs, most popular tags.  Clicking through from any particular word (or url or tag) you could do a network analysis: which member of the group first mentioned the item, who re-tweeted him or her, either with attribution or without.

The builder of a service like this would construct it as a platform that would allow group sponsors to set up individual accounts with one or more groups, and it would allow these sponsors to aggregate groups up or drill down from an aggregate cross-group view down to individual ones, perhaps with some comparative analysis -- "show me the relative popularity of any given word / content item across my groups", for example.

Twitter already has trending topics, as do others, but the lack of grouping for folks relevant to me makes it (judging by the typical results) barely interesting and generally useless to me.  There are visual views of news, like Newsmap, but they pre-filter content by focusing on published news stories.

An additional layer of sophistication based on semantic analysis technology like, say, Crimson Hexagon's, would translate individual key words into broader categories of meaning from all this, so you could, at a glance, in what ways and proportions your group members were feeling about different things: "Well, it's Monday morning, and 2/3 of my users are feeling 'anxious' about work, while 1/3 are feeling 'inspired'  on vacation."

As for making money, buzz-tracking services are already bought by / licensed by / subscribed to by a number of organizations.  I could see a two-stage model here where group sponsors who aggregate and process their members' feeds could then re-syndicate fine-grained analysis of those feeds to media and other organizations to whom that aggregated view would be useful. "What are alumni of university X / readers of magazine Y focused on right now?"  The high-level cuts would be free, perhaps used to drive traffic.

Microsoft-Yahoo Search Deal: And Then There Were Two And A Half

Microsoft and Yahoo! announced today that the former's new Bing search engine would now run the latter's search capability.  And, Yahoo! will sell paid search campaigns for the combined capability.  At least for starters, this means Google owns two thirds + of pro forma search volume (per Comscore), and MSFT+YHOO own the other third.  

Yahoo! had no choice but to accept colonization by Microsoft, as its own search technology was going nowhere.  Similarly, Microsoft had to do this deal with Yahoo because in today's tough market (even paid search is seeing only low single digit growth), it couldn't afford to divide its sales force to fight Yahoo in the face of their shared, colossal foe.

It will be interesting to see how much search volume sticks with / moves to each.  I'm guessing there is a curiosity factor that has Bing volume temporarily high, but that Google will hold serve, since Bing's advantages seem concentrated in some commerce-oriented niches.  (Here's a wacky idea though:  Microsoft could reverse one important structural disadvantage with a pre-emptive bid to embed Bing by default in Firefox, when Mozilla's current deal with Google expires in 2011.  Maybe not so wacky if, following long-term trends, IE's browser share drops close to 50% by then, and Google chooses to focus on Chrome.)

The other reason for this deal is for each side to achieve a critical mass of search volume to usefully inform display ad targeting.  Display ad networks have been a surprisingly profitable business, even in tough times (see also for example NET income for VLCK in Q1 of this year).  And the tip of the spear in the trend toward multi-channel optimization of marketing spend has been attribution analysis between search and display channels ("To what degree is a search triggered by display ad exposure, and how can we better target display ads to behaviorally-defined user segments across a network based on their search history?").  So, this deal would seem to be as much about shoring up each side's profit centers as it would be about huddling for warmth in the paid search world.

Given the complexities of having Yahoo! take over Bing sales and operations (through AdCenter), folks at Google should make hay in the short term, since their opponents will be distracted and the transition will create work for customers that arguably doesn't add much value either.  Hopefully, much of this complexity can be absorbed for advertisers by their search agencies, and hopefully they can get paid for some of that.

Notwithstanding interesting riffs on top of the established platforms, and newcomers that are useful in niches, this consolidation is further proof of the diminishing returns to innovation in search as we know it, that is, indexing and ranking unstructured content.  The next big wave of disruption in this category won't happen until we have radical change in the nature of the stuff being searched -- specifically, the advent of "Semantic Web" standards that will structure the underlying data in useful ways.  

It will be interesting to see how The Big Two And A Half left in search react to the propagation of open standards that could level the search playing field.  If the DOJ wants to fight the Search Trusts, perhaps its money is better spent on seeding and supporting those efforts than undoing what nature hath already wrought.

The Future Of Paid Content

Some are trying to put the "free content" genie back into the bottle and return to a pay model of some sort.  

This will be tough.  One problem is that (most, though not all) publishers have taught us to expect a lot for "free".  Another is that the world is awash in content, so if you're a publisher, hiding yours behind a pay wall just makes room for someone else to try to have his (ad-supported) day in the sun.  Snobs contend, "Water everywhere, but only a few drops (ours) worth drinking."   Maybe, but with production and communication costs low, and lots of people out there, there are enough exceptions to disprove the rule.  Regardless, focusing on these issues misses the point about where the value for the average reader is today.  The future of paid content lies not in the content itself, but in serving two adjacent needs:  filtering what's relevant, and helping audiences to use it productively.

Let's look at filtering first, and let's take Twitter as an example.  At north of 20 million users, and even with a churn rate fluctuating around 50%, you can't ignore it (and recent research suggests business people are paying attention).  The challenge is finding useful tweeters. (Digerati friends please help -- is that what one who tweets is called?  Or, is it "tweeps", or "tweeple", or some such?)  There are some early stage services probing at this: besides Twitter Search (formerly Summize / monetized via... TBD) and its upcoming "Discovery Engine", there's Hashtags (search by / subscribe to... wait for it... hashtags; monetized via tip jar),  Microplaza (tweets from people you follow; monetized via subsidy from parent co, which is an enterprise-focused collaboration platform ASP), Tweetmeme (Digg for Twitter; monetized via sponsorships), Wefollow (like the Yellow Pages of Twitter), plus a half a dozen more I've heard of and tried and doubtless dozens I haven't (see here for more).  (Michael Yoon and I are working on one, stay tuned.)   Is some refined, scalable version of one or more of these systems worth $2-3 bucks a month to some reasonable sub-segment of the Web-using public?  Related memo to Google: it would be worth $2-3 month to me to have Google suggest good posts from my blogroll (I use Google Reader) based on parsing my emails, which it currently does to serve me ads in Gmail.

Second, and perhaps potentially far more lucrative, are services to help audiences do stuff with content.  Be an affiliate for schools that sell courses related to the content, for example.  Last time I checked, the market for education, particularly online / just-in-time education, was growing at a healthy clip.  More simply, offer lectures by content authors / editors and sell tickets to these events, or be an affiliate for others who do that with your content. 

My favorite creative approach to segmenting audience needs and monetizing accordingly comes from the musician Jill Sobule, whose http://jillsnextrecord.com/ (scroll down to "A Message From Jill") does a nice job of unpacking all the reasons why folks engage with her music, and then pricing related offers accordingly.  Folks wonder about Myspace's future, what with the Google deal expiring soon and all.  I wonder:  does Jill's approach suggest one path might be to leapfrog Eventful and function as an uber-agent for the bands making their homes on Myspace?  

The "Wikipedia Index": A Proposed Metric for Your Firm's SEO Effectiveness

Doing a little homework for our upcoming talk at the CMO Club Boston dinner, and I'm laying claim to coining a new SEO metric term: the "Wikipedia Index".

Check out "Nestle" on Google.  The firm gets the top result, and the Wikipedia entry doesn't turn up until the 8th spot.  1/8 = 0.0125.   Nice job optimizing a variety of news, UGC, and corporate subsites to keep the unwashed masses' spin on Nestle below the fold.

Now check out "Unilever" on Google.  Again, the firm gets the top result.  But the Wikipedia entry turns up in third place, for a 0.33 score on the "Wikipedia Index".  Unilever's SEO strategy has left it "vulnerable" to letting others define and describe it.  

An absolutely high "Wikipedia Index" score is arguably not good.  Taking it one step further, look at it on a relative basis:  if your "Wikipedia Index" is ~3x other major firms', you may want to have a chat with your SEO team.

Google's Incredible Reversing Falls: A Structural Take on The Ad Market

Google just announced its earnings, which beat analysts' estimates and have its price jumping again. This, amidst all the doom and gloom in the ad business. Why? I see this development at the confluence of three things happening in the ad market right now.

1) While budgets are tight;

2) what budgets exist will continue to flow to digital media because of
a) their inherently superior measurability and
b) their faster and more flexible ad unit development and deployment cycles;

3) among digital advertising channels, a search click is the closest to a purchase.

But there are limits to how far this can go that are defined by the typical structures of media plans. A while back I linked to a podcast of this terrific talk by Doug Weaver. It's worth a listen again in times like this.

Nonetheless, Google's achievement is a freak of nature. If they can pull it off again in Q4, look for the fawning to begin again. Me, I'll be looking for them to move meaningfully beyond paid search as their primary business model, and will be closely tracking developments like this.