23 Musings

Google's power and influence in the online world has been demonstrated again today with the news that IncrediMail has had it's Adsense deal with Google stopped abruptly.

IncrediMail received a large amount of its revenue from displaying Adsense adverts to its users. Now this has suddenly stopped and IncrediMail is feeling the ramifications reflected in its share price which dropped 40%.

No real news as to why the deal has ended but the Adsense account that was used has been suspended so it's looking like it could be less than amicable.

This really shows the power Google holds over many websites that are considered to have good revenue streams. Switch off the major source of that revenue and what is left for them to survive on. Perhaps some of these websites find they are making so much off Adsense that they neglect other revenue sources and leave their eggs in the one basket.

Techrunch carried a post the other day highlighting the way publishers have little control over what adverts Google Adsense puts on their websites, using an example of the U.S. baseball/steroid drama. It's always been a bit of an issue for publishers that they could end up carrying advertising that isn't really suitable for their content, and as usual Google have an answer.

Google's just announced the Ad Review Center. This allows publishers to review the ads targeted for your site and lets them ensure they get suitable content related adverts. This should help publishers increase their revenue from Adsense as any adverts that are totally unrelated to their content are more likely to get clicks. Feedback from the publishers will make its way back to the advertisers as well, thus allowing advertisers to target ads better and get hopefully more qualified referrals.

The NY Times technology blog surmises that this could reduce Googles revenue but I highly doubt that as this could encourage wider take up of Adsense by those who've found it poorly targeted in the past.

It's another added value tool from Google that makes Adsense still the most viable ad serving solution for small publishers everywhere.

Part of Facebooks game plan seems to have been to create an illusion of openness while at the same time ensuring that their platform is actually closed to anyone who could tread on their toes in the areas that drive their revenue. Now admittedly they don't have much revenue right now but that is going to change very soon with all the new advertising options available to brands who want to be promoted on the social network. So with this increasing revenue should come an increasingly closed approach as they try to prevent others from stepping on their toes. Right?

Well, it seems Google may have a way in to the Facebook platform, and it may be something that Facebook can't do anything about.

Bring forth OpenSocket; a Facebook application that allows you to run any OpenSocial application on your Facebook profile. Now, as OpenSocial gains traction I can very well see developers looking for ways to monetise their efforts on this new platform. Of course, with Google at the helm one of the obvious options would be to carry Adsense adverts on your OpenSocial app. So that is how Google can potentially make advertising revenue out of Facebook without striking any sort of deal.

Will this happen? Well, I'd imagine Facebook will try to block Google ads from appearing, but if a lot of developers start using OpenSocial the demand to allow this may be overwhelming and actually more in Facebooks interest to allow this than to try to block it.

A few tidbits of insight from some of the webs best blogging reporters here today. As I'm busy I'm just going to link to them and let you read at your leisure:

The Facebook Ad Backlash Begins - an insightful look into the beginning of a possible backlash against the latest Facebook advertising announcements. My opinion; it will take time for users to understand the enormity of having their personal data in the hands of an advertising network of this scale. Expect to see the noise around this backlash grow.
Erick Schonfeld - Techcrunch

Why Is Google Afraid of Facebook? - a decent look into the reasons Google should be worried about Facebook. Traffic is only half the story, the main points are around the lack of access the Google spiders have to this data. Do Google feel shut out? Sure they do, otherwise why OpenSocial?
Om Malik - GigOM

Is Facebook Beacon a Privacy Nightmare? - a closer look at the reasons the new 'beacon' advertising tool from Facebook could be a privacy concern for users.
Om Malik - GigOM

I expect many more articles about the issues surrounding privacy and personal data with Facebook in the coming days, I'll continue to post and comment on the best. I also expect the focus to switch back to Google as more news emerges about OpenSocial and it's integration with Adsense and once the DoubleClick deal goes through it'll probably be Google taking all the flack!

Click fraud, the bane of every marketer who deals with paid search, is currently sitting at around 16% of the clicks you may be receiving. The average rate is 16.2% and can be significantly higher on content networks.

The average rate was 13.8% a year ago and 15.8% last quarter so it is rising quite fast:

The average rate of click fraud on content networks such as Google Adsense or Yahoo Publisher Network has risen more sharply:

The graphic below shows a threat map for where click fraud can be generated:

So why this continuing rise? Well as it's coming from content networks I can only guess that it may be being generated by rogue publishers and bloggers who are auto-generating extra clicks on their sites in order to raise their income. This kind of practice could really be affecting your bottom line and giving you a falsely inflated CPA (cost per acquisition) on your paid search campaigns.

Well worth keeping an eye on! And if, like me, you have a large campaign under your remit then contact your agency asap to check that you are receiving any rebates the search engines such as Google provide.

Thanks to Marketing Vox.

Google has announced the launch of their Adsense units for embedded videos.

By embedding certain YouTube clips into your website you can now have advertising units displayed via Adsense. You can choose categories of video to target to your site, select content from individual YouTube partners, or have video automatically targeted to your site content.

When you place a video unit on your website, you'll earn revenue from two types of ad formats: companion ads, which sit above your video content within the player and can be either text or image-based, and text overlay ads, which appear in the bottom 20% of the video content area. Ads on video units can be paid on either a cost-per-click or cost-per-thousand impression basis.

Sounds good for anyone with a high traffic website or portal, earning potential could be quite high if you place the right videos on your site.

Reports are out that Google announced the coming Adsense implementation for the gaming world at the Casual Connect conference.

This is really good news for game publishers as it means a new revenue stream they can tap into. It's especially good for those who create online games as well as the integration between games, ads and link destination will be much more seamless.

Imagine a game like WoW or Second Life implementing this, the placement opportunities would be endless and therefore the revenue that could be derived would be huge!

Quite how it would work on a standard console game (such as a driving sim) is yet to be revealed. Will it turn out to be purely display or will they tie in the online capabilities of the new consoles to allow gamers to click ads and visit the advertisers chosen destination. Not sure you'd have time to click an ad in a driving sim, or the inclination to break the gaming flow, but I'm sure this will be a huge success for Google on slower moving, more exploratory games where you explore worlds at your leisure.

In a post on the Google Blog, Google have spelled out why they are buying advertising network DoubleClick.

In summary they say (and I quote):

1. DoubleClick's products and technology are complementary to our search and and content-based text advertising business, and give us new opportunities to improve online advertising for consumers, advertisers and publishers.
   
   
2. Historically, we've not allowed third parties to serve into Google's AdSense network, which has made it hard for advertisers to get performance metrics. Together, Google and DoubleClick can deliver a more open platform for advertisers, and provide the metrics they need to manage marketing campaigns.
   
   
3. By combining Google's infrastructure with DoubleClick's knowledge of agencies and publishers, we can create the next generation of more innovative ad serving technology, one that significantly improves the efficiency and effectiveness of online advertising.
   
   
4. To manage ad inventory, some of the largest publishers use DoubleClick DART for Publishers – but a good portion of it goes unsold. It's our view that the combination of DoubleClick and Google will help these publishers succeed by monetizing their unsold inventory.

We believe DoubleClick can help Google deliver better, more relevant display ads, which improves the online experience of consumers. From a technical perspective, Google will also be able to get web pages to load faster by reducing latency from ad servers. Publishers will benefit by making more money from remnant inventory and – as has been the case with other technologies we've acquired – we hope to make ad serving more accessible. Smaller publishers would get access to DoubleClick's ad serving technology, enabling them to better compete in the global marketplace.

Advertisers and agencies will benefit, too. AdSense will support certain ad tags so advertisers will be able to use a broader selection of formats in our ad network, improving ad relevance. And the experience for advertisers will be more efficient, because there will be an ad server that provides consolidated reporting and management of display ads on all properties and networks. More generally, we'll be able to use our technology and record of innovation to improve the quality of existing products in the marketplace. We intend to invest heavily in R&D and product development to respond to the demand from publishers, advertisers and agencies for better tools.

In short, Google’s acquisition of DoubleClick will benefit all parties in the online advertising business, including advertisers, publishers, agencies and, most importantly, consumers.

Now that all sounds very promising to me! As an advertiser and publisher this kind of progression in the online advertising market can only be a good thing!

Ever wondered what contextual means??? Here's an article explaining why you should find out before adding Google Adsense to your website.

Google is trialing cost-per-action adverts on publishers sites in the U.S. I've been expecting this for some time as a natural progression for Adwords/Adsense to move to a similar model to affiliates. This will help advertisers avoid click fraud and see more of a return on investment.

More details on the trial are on the Googleblog.

Google Earth is now becoming yet another bastion of advertising in the online world. You can now view Adsense adverts attached to pushpins. Google AdWords customers can now place sponsored local ads inside Google Earth. The new feature lets advertisers place contact details and a logo on a map marker in the 3D environment.

Google emailed it's customers saying:
'Advertise on Google Earth
If you've created Local Business Ads in your AdWords accounts, they'll now appear on Google Earth in addition to Google Maps. Advertising a hotel in Lake Louise? A neighborhood cafe in Paris? Google Earth users across the globe can zoom in on your business. Don't forget to add a customized icon to make your ad stand out.'

A sensible edition you might think, but as Earth is much more about leisure than actually being a tool for finding locations it may alienate some users (although I'm sure it won't deter the majority).

Google's showing signs of being in the midst of developing Adsense for audio. This would be a natural progression considering their radio interests. To monetize audio such as radio, podcasts, streams would be a very cool next step for Google and if it could be as accurate and optimisable as Adsense it'll do very well. More on this at the wonderful Thoughtshapers.com.

Google has a voice search patent so I reckon this is quite likely going to happen with the next few months. This could get really interesting if it ends up with a contextual advertising service that can be used in radio and online audio streams.


Now, take this one step further and bring video into the equation... Google now owns the biggest piece of online video real estate in the combined audiences of Google Video and YouTube. They also own a company called Neven Vision who have all sorts of funky patents for video search including facial/object recognition. Put all this into the context of Adsense style contextual advertising for video and you may well have the monetization of YouTube sussed out!

Being able to contextually display advertising on the same page as the embedded video based on the video content is one thing, but being able to display in-context advertising within the video itself is an entirely more exciting proposition!

What do you reckon?

More YouTube news today. They've got themselves in trouble with an organisation representing Japanese copyright holders who have demanded the removal of around 30,000 video clips from the site.

The clips are mostly TV and music clips, they were discovered during a 5 day audit of the site by the copyright holders organisation.

This could set a precedent for all those media companies who as yet haven't struck any kind of revenue sharing deal with YouTube. I'd expect YouTube to come out with some kind of offering for media owners very soon to stop requests like this coming in from all angles. With Google now in command a revenue sharing approach to Adsense seems a logical approach to take.