Commentary
Google: Caught In The Act Of Balancing
- by Gord Hotchkiss , Featured Contributor, November 18, 2010
In last week's column, I talked about the number of changes I was seeing on the Google results page, and, in particular, how they might maintain the delicate balance between driving revenue from the page and maintaining user trust. No sooner did the digital ink dry on the column …
Gord - you really mustn't let the ink dry..
With the advent of Google Instant Preview the sidebar ads were 'almost' rendered invisible already. Just like people have gotten used to Google Instant taking up a fair chunk of the real-estate and pushing Google Ads into the center of our viewing space, so will the little magnifying glasses attract searchers to click and view. The Preview covers the sidebar ads.
My "Well done, Google" is for continuing to increase revenue for themselves ensuring clients/advertisers have a highly relevant place to advertise. Think of the increase in bidding and quality score activities to get those 2-3 spots. For those who have not recognized, as you note, that the sidebar ads underperformed for Google and for advertisers it will be a heavy sticker shock. I say good riddance.
While I agree with your basic premise - that fewer ads will garner more clicks for those advertisers and more revenue for Google, I would have to disagree that this is a totally good thing. Paid search is one of the few ways that smaller and relevant advertisers can compete against companies that can pay multiple dollars per click. For the smaller advertisers, that 20% represents a lot of good business at prices they can afford. Take a look at the term "swim suit". I see an ad for "Plus Size Suits" in the 6th position. The ad is clearly relevant for some, but would probably not pay out in the top 3.
While there may be some room for smaller or niche players in less-broad terms, the auto-bids from the likes of Amazon and Ebay are likely to box out the smaller / niche advertisers for the top 3 (or however many) positions.
So, I would say its good for big advertisers, but not for all.