The Digital Lookout

As 2008 comes to a close I thought I’d do a quick recap of the topics we have been talking (and blogging) about this year in the world of digital media and search engine marketing.

Mergers and Buyouts

A lot of headlines have been written this year about various potential mergers and buyouts, mostly in the world of the search engines.  Whether it is Microsoft buying Yahoo, Yahoo partnering with Google, or Yahoo merging with AOL barely a month has gone by without a new story about the battle for search engine supremacy.  And where has it got us?  Back where we started with Microsoft and Yahoo still trying to find the best way to dethrone Google.
Away from search (slightly) there was the Google Double Click deal which caused a stir, something which is still yet to show real significance.

Google Pushing Non Search Products

At the Above and Beyond event in September Google discussed everything, apart from web search.  A clear sign of intent that they are looking to diversify in 2009 and place the Google strangle hold on other markets such as mobile marketing and display advertising.  On top of this they launched Google Ad Planner which allows digital marketers to plan digital campaigns outside of search and Google Ad Creator which allows people without flash experience to build display adverts.

Quality Score

Two lots of wholesale changes to quality score in 2008.  The first in September where minimum bids were removed and dynamic quality score was introduced.  On top of this Quality Score began to be displayed on a 1-10 scale and Google began showing the estimated first page bid for all of your keywords.

This was then followed at the end of October when they began normalising click through rate based on an ads position when factoring it into quality score calculations.  Further changes were launched at the same time which affected when and why an ad appeared in the valuable “yellow box” positions at the top of the results.

Google’s Gambling U-turn

One of the biggest stories of the year outside of the merger talk was Google’s U-turn on their policy of not allowing gambling advertisers.  Amazingly, in the face of a difficult Q3, Google’s halo slipped and they decided to begin allowing legitimate gambling advertisers onto the Adwords programme.  Opening up millions of pounds of additional turnover in one swift move.

Google Trademark Bidding

As always, changes on Google, are big changes.  And with the removal of trademark protection they ruffled a few feathers and made themselves a few quid in the process.  Their argument was that quality score and min bid would take care of it, but then they removed min bid and left a lot of trademark owners with a headache and high CPCs on brand terms.  Now Google find themselves with a high profile court case on their hands!

Social Media

Once again on of the hot topics of the year in many different guises.  Whether it was Facebook getting a Facelift, Google launching and subsequently pulling lively.com, or Barack Obama using social media tools to become US President the word social, closely followed by media, network or utility have been uttered many a time in 2008.

Browser Wars 3.0

The launch of Google Chrome announces browser wars 3.0 and looks set to see this space slightly more interesting than usual in 2009.  Although it does have a lot of people questioning what information you would be giving away to Google by browsing using Google Chrome.

Best Practice Funding

As Google’s dominance grows, their charity slows!  Google announces that as of Jan 1st 2009 they will no longer be offering best practice funding to search marketing agencies that resell Google Adwords.  No big deal for direct advertisers but for agencies slow to adapt it could mean a few casualties in 2009 as the more innovative and transparent PPC agencies learn to live without handouts.

There’s my recap of the year, anything I’ve missed?

It’s been another fast paced and exciting year in the digital world we operate in and no doubt 2009 will follow suit and through up surprises and changes which give me something interesting to write about!

Google has entered into the festive spirit today by including images and icons on christmas based search results.  A search on Google today for the keyword christmas presents, christmas trees or christmas gift ideas brought back the usual search results but with a festive icon running down the page to the left of the PPC listings.  I’ve spotted listings using candy canes and holly, have you seen any I havent found?  Im guessing there are more out there if you have the time to spend searching on Christmas keywords.

Whilst we in the search marketing business consider the UK market as one of the most advanced in terms of search engine marketing and search engine strategy a recent report by hosting company fasthosts claims that British consumers still don’t understand how search works.

According to the report 1 in 4 Britons were unaware that website owners were able to make changes to their website which would influence their position in the natural results and 22% believed that the natural SEO results were influenced by how much a company was paying to appear.

On the PPC front 1 in 3 respondents claimed to ignore sponsored links completely due to their commercial nature believing them to be “less worthy” and “less useful” than the natural search listings.

As a search engine marketing professional it is shocking to read the understanding of search in the UK is so poor but it does raise the question of what this means to the future of search engine marketing as consumers become more knowledgeable about search engine marketing. 33% of the respondents claimed to avoid PPC listings as they were less useful, but I would argue that they are less useful because the user does not understand them. I am fully aware of how PPC works but I still use sponsored listings when it suits my need. If my search is due to end in a purchase I am far more likely to use paid search listings as I know they will direct me to the most useful page and also contain details of any special offers available to me. However if my search is based around finding information I am more inclined to use the natural results as they will be less commercial.

As I also understand how natural search results work I am also more considered in how I view them. Rather than clicking blindly on the top results I take some time to read the results, check the URL and the listing content to decide which one is going to be the most useful. I am not going to rely on the search engine to decide which the best website is for me, I will make up my own mind thank you. I may even perform a second search before even clicking a link!

The results of this report suggest that consumer interaction with search engines could be changing over the next few years and companies engaging in search marketing are going to have to understand what this means to them. Is CTR going to drop on paid listings as users understand them more? Is position 1 in the search results going to mean less as people become more selective with what they click? Only time will tell.

In a memo to its partner agencies yahoo has announced changes to its commission structure which will see it follow Google’s lead and reduce the amount of Agency commission from January 1st 2009.  It is not going as far as Google in removing commissions completely but it will see a cut of 1% for the majority of agencies but a potential hit of 6% for unlucky agencies which fall into a specific band with a potential loss of all commission for the really small spenders.

At present agencies spending between £20,000 and £79,999 receive a rebate of 5% from Yahoo and anyone spending over £80,000 receives the maximum 10% commission on search spend.  The January changes will see agencies spending between £50,000 and £99,999 receive 4% rebate and anyone spending over £100,000 9%.  This means the removal of commissions for agencies spending less than £50,000 a month and a hit of 6% for those who fall between the £80,000-£100,000 monthly spend bracket.

The announcements come in the same week that Yahoo! has announced it will be closing six European offices in the coming 12 months in a bid to cut costs.  Potentially suggesting that the two decisions are linked in a company wide profitability drive.  After all, agencies will be so concerned with losing their Google BPF that they hardly notice the Yahoo change right?

Its a disappointing step from Yahoo who could have used the Google BPF removal as a tool to grow their market share.  Either by simply pushing agencies on the message that they are still offering 10% or even making the bold move of increasing the commissions to further incentivise search agencies to use their service.  After all, they still offer 15% on display advertising placements so why not search as well?

Yahoo has been failing to eat into Google’s market share for a long time and it has been becoming more and more apparent of late that a merger with Microsoft might be the only way we will see true competition in the paid search market.  But this was a prime opportunity to steal a few more ad dollars from Google and one, in the current economic environment, they probably couldn’t afford to miss.

If Yahoo had been brave and increased their commissions, I for one would have been looking for way to spend more pay per click budget with them but now they have reduced them, I certainly wont be increasing PPC spend with them in the New Year.  I think this can safely go down as an opportunity missed for Yahoo, and could even been seen as a signal of intent not to put up a significant fight against Google in the field of Pay Per Click.

Earlier this week Google announced the launch of the ability to target iPhones and mobile devices which have full (html) web browsers on the Adwords blog.  As always happens with these announcements the news spread like wildfire and it is now all over the blogosphere and shouldn’t really be news to anyone who works in search engine marketing.

All campaigns are automatically opted in to the iPhone search results by default but to the intelligent search engine marketer this new functionality offers new opportunities for trial, refinement and maximisation of mobile search.

To the lazy or uneducated this box will remain ticked and the PPC campaign will continue to run on both standard web search and the new iPhone and advanced mobile search.  Using the same keywords, same ad text, and directing to the same website.  There is no harm in this as such given the volume and the way it follows standard search specifications.  But in many industries this would be massively missing an opportunity.  Location specific products such as hotels and national companies with regional branches could do so much more with this functionality if they put their minds to it.

Mobile campaigns need treating differently to standard web search campaigns because users interact with mobile Internet in a different way.  To realise the opportunity then there are a number of steps I would recommend;

Campaigns: deactivate iPhone search in your main campaign and set up a new campaign targeting ONLY THE NEW iPHONE SEARCH.  This will allow you to build a campaign aimed solely at the mobile users and mean you can make the necessary amends.

Keywords: build a keyword list based around mobile users.  This tends to mean simplifying your keyword list and using more broad keywords and dropping the long tail.  But make sure you include location specific keywords if your product fits with people using destinations in searches.  Most people using mobile search to find things want to find something nearby so will often include a town or area name in their search.

Ad Text: Obviously follow the standard Adwords guidelines of making it relevant the search phrase but also consider making it specific to mobile users.  If you are going to offer something special (see point below) then include it in the creative.  Also consider reaching out to mobile users in the creative, a message such as “welcome mobile Internet users!” might sound cheesy, but it’ll also make you stand out.

Website/Landing pages: It is still best practice to have a tailored site for mobile visitors even as mobile Internet advances.  But by splitting out the campaign so you can be sure the visitor is coming form a mobile device, why not send them to a page targeted at their needs?  Or even offer them something special? If you have local stores why not have a splash page offering a discount for all users who show the page in-store and make a purchase?  this would work great for hotels, coffee shops etc.  20% off if you show this page in store.

Tracking: Make sure you track it separately so that you can judge performance.  This probably wont be performance by way of conversions but it will certainly help to see bounce rates and site traffic stats.

Bid strategy: Use the fact you have split the campaign out to your advantage, use the tracking you have installed to judge keywords based on mobile search performance rather than web search performance.

Keep testing!: your unlikely to get this right first time but by trying different things you are bound to find some successes so don’t be afraid to try.  iPhone’s and other mobile devices with full browsers are set to revolutionise mobile Internet, it is better to make your mistakes now and learn from them, rather than in a couple of years when you are already behind the game!

Mobile strategy shouldn’t be something which gets lumped together in the general web pot, in the same way search shouldn’t.  Making sure you have a clear strategy and objective for mobile activity will ensure that as mobile Internet grows, you are best placed to take advantage.