This the studipest thing I've read in a long time: http://www.useit.com/alertbox/search_engines.html
Search engines are hurting content companies... wha-wha-what!??!!? Last I checked 10-20% of our traffic can from search engines (depending on the blog), and a significant portion of our revenue came from Google Adsense.
Content providers should kiss the ground search engines walk on because they have eliminated the need for smaller content providers to have a marketing budget! Produce great content for as litle as six months and you'll get traffic--compare that to the magazine or newspaper world. Exactly.
The fact that search engines make money money along the way doesn't take away from our ability to make money. In fact, many of our advertisers tell us they found us because they were searching for themselves or their products and found our blogs.
The fact that some folks can game a search engine doesn't matter because the search engines are--at the end of the day--ahead of this problem.
It's not a zero sum game. Advertisers have a lot of money to spend, and in many cases they can't get all the traffic they need from cost per click sites. Advertisers still want to be in a nice branded place--like Engadget, Autoblog, TVSquad, etc.
I don't want to be in the search business and I don't care if they make money. If they make money they can make their service better and send me more readers... if I have more readers I make more money. A rising tide lifts all boats--case closed.
The stupidest thing I've read in a long time...
Reader Comments
(Page 1 of 1)3. Kind of funny coming from a guy that was on googles advisory board. I think what people are missing is that search engines are entering every industry they can and using those industries as loss leaders. In the process they are crushing established industries. What is more distribing is that it is unlikely any of the web 2.0 companies today will be around in a few years. Those are are not bought outright are doing nothing more then providing free R&D to the big players who will make their own.
Posted at 1:02PM on Jan 10th 2006 by Markus
4. My capitalist heart tells me that any text that includes the term "obscene profitability" that is NOT a business plan kinda misses the point. Your comment is spot on, Jason.
Posted at 5:50PM on Jan 10th 2006 by Max Niederhofer
5. I found this blog as a link from Rough Type, as a second viewpoint on Jakob's article. While the article is factually incorrect, as you pointed out, the bigger problem is that it ignores several key factors, and is simply logically insupportable. I think that your response, while factually correct, still misses the proper way to criticize the asinine claims made in the article. I'll try and do a bit of it for you, as his article really bothered me. The article begins its attack with the idea that search engine placement pricing scales with client profit, eliminating it. This is flawed in several ways - firstly, it assumes that only a top bidding site has ad space. This in untrue. In fact, there are multiple sources for advertisments, and all competing companies will not use each source, as you noted. The bidding for space also is not a clear bid war, as Jakob assumes - you bid does not need to go up to $7.99 to compete - each company has a range of options for continuing to advertise, and if this one minimizes profit margins, then they will simply not rely on it as heavily. Instead of getting 1000 clicks from google search, they will opt for 500, and move ad money elsewhere, where it is more cost effective. (Note that there dollars do not have to be more actually effective - they can afford to get fewer people at a lower cost per person, because their profitability can still be higher with the ad budget lowered. Hell, for $7.99, they can get more customer mindshare by mailing out plush toys with their logo.) Jakob also assumes that a re-design will have no effect because other sites will immediately follow, and therefore instantaneously eliminate the gain in profit margin. This is also untrue - there is a significant lag time involved, and continued improvements certainly can keep a company ahead. This is clearly important for more than just content providers - People access more than one content provider, after all. They rarely order, for instance, their toilet paper from five different vendors, so there is a more specifically competitive market, and a vendor can stay ahead. The most important point, however, is that all of a sites profit is not derived from a single click through - to use his example of a profit of $4/visitor, what happens when someone bookmarks the page to do return business? The purpose of a search enigine add is not just for the immediate click, but also to expose users to the site so that they may do business there in the future. They may also recognize it and even tell others about it. That is why search is a facilitating service - it is not simply that it drives traffic, it also exposes people to the correct so that in the future they do not need to search. (Now, when you need an encyclopedia online, you don't go to google and search for the term, you probably go straight to wikipedia, even if you found them through Google the first time.)
Posted at 8:52AM on Jan 16th 2006 by David Manheim
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1. If usability had a poster child, it would be Jakob. He's only hurting the adoption of his good ideas and notions on usability (yes, he does have them) with these histrionics. He could save us all some time by instead shouting, "I'm still relevant!"
Posted at 7:09PM on Jan 9th 2006 by Michael Martine