The New Economics of Advertising

April 13, 2008

Google Search or Internet Portal

Filed under: Google, IChannel, Yahoo, contextual, top — Dash @ 7:59 pm

CNet asks “Is Google’s user interface outdated?” The DOS C: prompt was displaced by graphical windows. Ironically, Google has displaced cluttered windows with a box that resembles DOS.

We have usage questions. Is Google a search engine? Or has it displaced the browser address box? How are millions really using Google?

Internet Portal

Users type and search. What are they typing?

  • About 25% of users type the website, domain, or partial name. For example, the top keywords for Facebook are facebook, facebook.com, www.facebook.com, and face book. A large percentage of users no longer use the address bar or bookmark sites.
  • Type ticker symbols and Google takes you to the financial data for a company.
  • Type an address and Google assumes a map search.
  • Type an area or zip code; Google returns a map.
  • Type ‘define:word’; Google becomes a dictionary.

No doubt, Google will extend their distributed processing platform to handle people search like Spock.com and reverse phone number search. Google has become a portal for getting to places, quickly.

Does this account for one third or more of Google’s use?

Replacing the Yahoo Directory

Yahoo started with a directory of web sites. Publishers submitted domain names by category. As the lists grew, Yahoo scrambled to create order.

For the most common keywords, Google has become the directory. Using the Google system that ranks entries based on cross-links, these keywords produce essentially the old Yahoo directory with relatively static choices. Google’s ranking system favors historic links, thus the content does not change quickly.

Google has enhanced the directory with many features.

  • Relevant photos and videos have been integrated with the search results.
  • Moving toward the semantic web, lists of phrases that include the keyword appear at the bottom of these pages. This is similar to Yahoo’s efforts to group related subdirectories as new pages.
  • For timely content, the news search only shows recent content. The content is still weighted to favor brands with long history and legacy cross-links.
  • Book, blog, and scholar search further segment the directory of relevant sites.

‘Flypaper Effect’

As a blog, the Long Tail has little chance of becoming visible in the top pages of the Google’s directory.

Successful search terms can be categorized as ‘flypaper’. These unique combinations of names, trademarks, and other terms drive readers to us. Thousands of search terms each contribute a few hits; as opposed to one or two search terms that account for the majority of hits.

Flypaper accounts for the vast majority of search visitors.

Contextual Search

Google has been promoted as the intelligent search that contextually match searchers with content. After eliminating it’s value as an Internet portal, Yahoo directory replacement, and flypaper tsunami – what percentage of the use is truly intelligent search based on context?

Analyze your data. What has been your experience?

Google: Okay To Be Evil Sometimes

by 

marissamayerbig.jpgIs Google done with its famous motto, “Don’t be evil?” TechCrunch’s Michel Arrington cites remarks by Google star Marissa Mayer in Australia that suggest that even Google is getting sick of this albatross:

Last week, however, Google’s Marissa Mayer said ‘It really wasn’t like an elected, ordained motto’ during an interview in Australia, adding ‘I think that Don’t Be Evil’ is a very easy thing to point at when you see Google doing something that you personally don’t like; it’s a very easy thing to point out so it does get targeted a lot.’

Google’s Selectively Optimized Contextual Targeting

Filed under: Google, contextual — Dash @ 6:09 pm
Ed: Google search on advertising. Google is first. Manually optimized. Where is Yahoo, Microsoft??
Google Advertising
adwords.google.com      Bring targeted traffic to your site in minutes – Try Google AdWords.
How To Advertise
www.RippleTV.com      Show Your Ads In Local Shops On TV Screens. Simple. Try for $5!
Want More Customers?
www.valpak.com/advertise      Target Your Audience With Effective Direct Mail Solutions! Learn more.
Related searches: advertising careers advertising history advertising costs types of advertising

Advertising.com

The result: the advertiser gets the best ad placements possible across thousands of websites and the website earns more revenue by having Advertising.com 
www.advertising.com/ – 13k - Cached - Similar pages

Advertising - Wikipedia, the free encyclopedia

Advertising is a form of communication whose purpose is to inform potential customers about products and services and how to obtain and use them. 
en.wikipedia.org/wiki/Advertising - 106k - Cached - Similar pages

BidVertiser – Pay Per Click Advertising On Sites Of Your Choice.

Pay per click advertising - online advertising directly on sites of your choice, internet marketing solution for online advertisers.
www.bidvertiser.com/ – 69k - Cached - Similar pages

BidVertiser – Pay per click advertising on sites of your choice.

We use a pay per click advertising (ppc) model which means that you only pay for the clicks you receive. You choose how much you are willing to pay for each 
www.bidvertiser.com/bdv/BidVertiser/bdv_advertiser.dbm – 69k - Cached - Similar pages

A Free Online Advertising Network | Free Blog Advertising 

AdGridwork is a Free, Online Advertising and Link Exchange Network. We provide an automated service that serves your Ads and Text-Links on thousands of 
www.adgridwork.com/ – 10k - Cached - Similar pages

Advertising Careers and Business Advertising Information

Get advertising career help for freelance copywriters and other ad pros and find insight for businesses needing advertising guidance as well.
advertising.about.com/ – 29k - Cached - Similar pages

WSJ Advertising

Wall Street Journal Advertising. WHAT’s NEW. The Wall Street Journal Honored With Two Pulitzer Prizes in 2007: Public Service and International Reporting 
advertising.wsj.com/ – 12k - Cached - Similar pages

Advertising Age – Ad Age is the leading source of news, views and 

A definitive general collection of news and analysis regarding goings-on in the world ofadvertising.
adage.com/ – 46k - Cached - Similar pages

Business Week Online: Advertising

Get advertising information on companies that have appeared in our directories, such as the MBA, Industrial Design and E-learning directories. 
www.businessweek.com/advertising.htm – 25k - Cached - Similar pages

Google Advertising

Allows you to buy advertising on the Google search engine, or on other sites through its AdSense program. Includes a tour and FAQ.
www.google.com/intl/en/ads/ – 13k - Cached - Similar pages

Searches related to: advertising

advertising careers   advertising history   advertising costs   types of advertising  
advertising tips   advertising prices   advertising campaigns   newspaper advertising  

Ed: Drill down on online advertising costs. End of optimized directory.
Online Advertising
www.google.com      Maximize revenue with targeted ads. Try Google advertising programs.
Online Press Release
www.prweb.com      The most cost effective way to market your business locally!
Facebook Advertising
www.facebook.com/ads/      Reach the exact audience you want with relevant targeted ads.

Online advertising - Wikipedia, the free encyclopedia

Though, as seen above, the large majority of online advertising has a cost that is brought about by usage or interaction of an ad, there are a few other 
en.wikipedia.org/wiki/Online_advertising - 39k - Cached - Similar pages

Online Advertising May Cost More Than You Think – ClickZ

Do you really know how much you spend to acquire customers online?
www.clickz.com/showPage.html?page=3427421 – 83k - Cached - Similar pages

Internet Advertising Cost

A question I get a lot is “What does it cost for Internet advertising?” I’m almost tempted to tell people, whatever they want to spend. 
ezinearticles.com/ ?Internet-Advertising-Cost&id=517472 – 46k - Cached - Similar pages
[PDF] 

Online AdvertisingCosts vs. Effectiveness We provide rules that 

File Format: PDF/Adobe Acrobat - View as HTML
the true costs of online banner advertising and opt-in e-mail. marketing compared to traditional print (offline) marketing. campaigns. 
www.forbes.com/fdc/ mediaresourcecenter/documents/gertner.pdf - Similar pages
[PDF] 

Internet Advertising and the Generalized Second Price Auction 

File Format: PDF/Adobe Acrobat - View as HTML
used by search engines to sell online advertising that most Internet ….. The ease of use, the very low entry costs, and the transparency of the mechanism 
rwj.berkeley.edu/schwarz/publications/gsp051003.pdf - Similar pages

CPA – The Holy Grail of Online Advertising? – ReadWriteWeb

Aug 14, 2006  This article explores the new online advertising model of CPA (Cost per Action/Acquisition) and determines whether it will be The Next Big 
www.readwriteweb.com/archives/cpa_holy_grail.php – 33k - Cached - Similar pages

Quick jump navigation

Jul 6, 2006  It is the fastest-growing segment of the online advertising market (see ….Instead, advertising becomes a variable cost of production that 
www.economist.com/business/ displaystory.cfm?story_id=7138905 - Similar pages

Online Advertising Costs Expected to Surpass Newspaper Advertising 

Aug 8, 2007  Greg Sterling over at Search Engine Land posts a startling (but not surprising) report that internet ad spend will surpass traditional media 
www.seroundtable.com/archives/014424.html – 26k - Cached - Similar pages

Online Advertising: How much online video advertising costs

Dec 18, 2007  Almost as bad as the user-generated video flooding the Web is the professionally generated stuff Newspapers are thrusting nebbishy 
valleywag.com/tech/online-advertising/ how-much-online-video-advertising-costs-335195.php - Similar pages
[PDF] 

Internet Advertising and the Generalized Second-Price Auction 

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engines to sell online advertising. Although GSP looks similar to the ….. transition costs: VCG revenues are lower than GSP revenues for the same bids, 
www.benedelman.org/publications/gsp-060801.pdf - Similar pages
Ed: Long Tail for advertising information. No SEM ads. Not optimized.

    
 Web  Personalized Results 1 - 10 of about 391 for economicsflypaper, SEO. (0.04 seconds) 

New Economics of Advertising: HOW-TO: SEM or ‘Flypaper Effect’ for 

HOW-TO: SEM or ‘Flypaper Effect’ for Attracting Readers. What draws more readers: search engine optimization or the ‘flypaper effect’? SEM and SEO Revisited 
adecon101.blogspot.com/2008/ 03/how-to-sem-or-flypaper-effect-for.html – 92k -Cached - Similar pages

New Economics of Advertising: STATS: Paid versus Natural Search Clicks

Simplify the technologies behind the new economics of buying and selling  Ed: Flypaperbeats natural SEO. Accidental+habitual clicks approximate paid 
adecon101.blogspot.com/2004/06/ stats-paid-versus-natural-search-clicks.html – 108k -Cached - Similar pages
More results from adecon101.blogspot.com »

FROM JOURNALS Andrew F.

P.G. WyckoE The Elusive Flypaper Effect. K.T. Duffy-Den0 and R.W. Eberts: Public Infrastructure and Regional Economic Development: A 
www.blackwell-synergy.com/doi/ pdf/10.1111/j.1467-9787.1992.tb00174.x - Similar pages

Why The Community CEO Doesn’t Work | CenterNetworks

Nov 14, 2007  While SEO directory products like Mahalo have low switching costs, ….announcement like flypaper to social media advocates across the web. 
www.centernetworks.com/community-ceo-does-not-work – 42k - Cached - Similar pages

EconPapers: Policy Research Working Paper Series

Niggol Seo and Robert Owen Mendelsohn; 4163: A Ricardian analysis of the impact  Adam Wagstaff; 4133: Fungibility and the flypaper effect of project aid: 
econpapers.repec.org/paper/wbkwbrwps/default4.htm – 36k - Cached - Similar pages

Ed: QED


March 29, 2008

NEWS: Long Tail Economics

Filed under: contextual, demand growth, statistics — Dash @ 7:29 pm

Google news search with phrase ‘Long Tail‘ produced the list below. Note the following conclusions:

  1. Search optimization or flypaper effect?
  2. CONTEXTUAL, BEHAVIORAL, AND AI TARGETING
  3. No adsense



Will the burden of the Long Tail kill Internet commerce?
ZDNet - Mar 22, 2008
Long Tail businesses are based on aggregating huge numbers of micro-markets. GOOG, Facebook, YouTube, and many other online businesses are Long Tail 
Have we misinterpreted the business value of the long tail?
ZDNet - Mar 20, 2008
I’ve been thinking about the economics of the long tail and its impact on the business of Silicon Valley’s largest Internet companies and discovering some 

Brandweek Magazine
The Long Tail Batters Borders
Brandweek Magazine, NY - Mar 22, 2008
By Elena Malykhina The Long Tail may be responsible for both Borders’ and Barnes & Noble’s latest painful chapters. As the book chains report drops in BKS

Straits Times (subscription)
How macaques and humans can live together
Straits Times (subscription), Singapore - Mar 25, 2008
I came to learn about a small population of long-tailed macaques that live in the few forest patches that remain on this once lushly forested island. 
The Longtail of IT Governance
ZDNet - Mar 14, 2008
Archer Exchange is an intriguing idea one that allows the company to address the long-tail of applications within the IT governance space. 

Canada.com
Dogs with docked tails can grow up mean: study
Canada.com, Canada - Mar 24, 2008
“When the long tail was wagging, then other dogs would approach (the robo-dog) in a confident friendly way,” Leaver said in an interview. “But when the tail 
Mercury has super long, glowing tail
ABC Science Online, Australia - Mar 2, 2008
New measurements of Mercury’s yellow-orange tail, which streams in the solar wind like thelong tail of a kite, put it at more than 100 times the radius of 
Mercury has long, glowing tail
Times of India, India - Feb 29, 2008
According to him, the actual two degree sodium tail is as long as four full moons. Baumgardner said that Mercury was blocked out in the image as its 
Open country
Borders Today, UK - Mar 27, 2008
In the relatively dim light of the wood I nonchalantly replied that they must be as no other little bird has such a long tail – in fact, more than half the 

CNET News.com
Political blogs are definitely long tail, survey says
CNET News.com, CA - Mar 10, 2008
A new survey shows that few Americans really care what bloggers have to say about politics, despite the plethora of opinionated blogs out there this 


February 10, 2008

Contextual, Behavioral, and AI Targeting

Filed under: Behavior Targeting, Google, IChannel, contextual, top — Dash @ 9:25 pm

Contextual (CT) and behavioral targeting (BT) represents the current buzzwords for online advertising. Similar to artificial intelligence (AI), they suffer the problems of scalability. Let’s take a look at these simple concepts, how they work, and what impact they will have on advertising.

What is AI?

AI studies human thinking and tries to create programs that simulate the process. AI started at MIT and Carnegie Mellon in the early 70’s. Rule engines allow practitioners to analyze the thought process, enter rules and knowledge objects, and hope that intelligent decisions emerge.


Not surprisingly, AI had limited success in narrow areas. The human thinking process is too complicated to automate with sets of rules. 30 years later, we’ve made evolutionary progress toward understanding the human mind.

I can’t forecast revolutionary progress for AI. Millions of rules might be needed for simple everyday decisions.

What is Contextual Targeting?

CT uses programs to analyze the content of a page and deduce information. Google, Alta Vista, and other robots scan the Internet for pages, analyze them for content, and present relevant content to simplify finding answers on the Internet.

Google has developed the most advanced system for CT. Users find relevant content and view top of page ads (SEM) that are modern versions of Yellow Page advertising. Similar to AI, Google has developed enough rules such that relevant ads appear for the most requested keywords. They further optimize these ads to earn the maximum revenues based on CTR (click through rate) and CPC (cost per click) bids. Google keeps 100% of these CPC revenues.

Google also supplies text ads on affiliate sites. For most publishers, Google has not optimized the contexual relevancy to deliver higher eCPM’s. Most publishers see ads on their pages and question the relevancy of those ads to their readers. Not surprisingly, millions of affiliates gain eCPM from Google of $0.25 to $0.50 per thousand page views.

Google earns less when users click on ads on affiliate pages. Thus, they have less motivation to optimize for affiliates.

Client-side CT

Competitors have stepped in to supply client-side CT ad serving. It’s trivial.
Rather than using a robot to scrap the Internet for pages, Javascript supplied by the ad network analyzes the DOM (Document Object Model) of the page. The program deduces the keywords on the page and communicates with their ad server to present relevant ads.

Every CT provider have claimed success with increased eCPM for publishers. However, like AI and Google, their solution may not scale. Solutions are specific to certain types of pages; and there are infinite variations on the world wide web. Thus, the specific CT implementation represents a specific solution that works for narrow cases; and may not scale for every publisher.

Behavioral Targeting

BT uses information gathered about users in a network and infers interest to present relevant advertising across their network. For example, Facebook notes that a user plays golf from his Facebook profile. Facebook then presents golf ads when the same user appears at a sports affiliate site.

BT has some technical issues. Cookie deletion disconnects the user at an affiliate site from the user’s profile at Facebook. Users need to revisit Facebook, get assigned a new cookie, and thus reconnect with the profile before learning about relevant ads at affiliate sites.

BT also faces privacy regulations. The FTC and IAB seek regulations to define the transparency that allows Internet users to protect privacy rights. Similar to DoubleClick in the early stages of Web 1.0, Web 2.0 BT companies may be constrained from innovating and monetizing at will.

Finally, BT has the problem of scalability. If I state golf, how do they know if it’s true? Why only present golf ads at a sport site? Why not present at a dining site? Or any time? Do I have other interests that are immediate? How do you determine what those interests may be? What rules do we define to optimize relevant ad delivery.

Facebook reported my son playing games at an affiliate site on my profile to my circle of friends. Will I be plagued with game ads? Will my circle be followed with game ads?

Like AI and CT, BT can show success with limited cases. The scalability can be even more challenging than Google’s continued efforts to optimize revenues for it’s own SEM keywords.

Conclusion

Using BT or CT to optimize targeting is useful. However, like AI, the issue is scalability. Every network claims robust solutions. AI never found the killer app. If Google has not achieved ubiquity after spending billions, the progress for CT and BT may also be evolutionary.

(c) Dash Chang, 2008

Artificial intelligence – Wikipedia, the free encyclopedia

The modern definition of artificial intelligence (or AI) is “the study and design of intelligent agents” where an intelligent agent is a system that …

iMedia Connection: Contextual vs. Behavioral Targeting

Mar 31, 2006 … A new study conducted by Synovate for Vendare asks consumers how they like to be targeted.

Contextual and Behavioral Targeting: Worth a Try – ClickZ

Refined technology, glowing case studies — media buyers owe it to themselves and their clients to really home in on their target audiences.

Behavioral Targeting and Contextual Advertising

Sep 1, 2004 … Behavioral Targeting and Contextual Advertising Is online advertising undergoing a rebirth? Some might argue it is, first spurred on by …

The Coming Ad Revolution Wall Street Journal 

This approach (called behavioral targeting and already in service by ad networks that track users through so-called tracking cookies) undercuts traditional…, by Esther Dyson

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