By Grant Crowell , December 16, 2003
Too often, web entrepreneurs today think of search as a one-way business, focusing solely on how to make money off of the search engines without understanding how search engines also need to make money in order to survive and thrive.
A special report from the Search Engine Strategies 2003 Conference, August 18-21, San Jose, CA.
A longer version
of this article that goes into more extensive detail about search engine monitization issues, including how the services balance the need to make money with providing the best possible search experience to users, is available to Search Engine Watch members.
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Those attending the session, "Search Economics, Search Monetization Strategies," at the Search Engine Strategies conference in San Jose this past August, heard representatives from Google, Yahoo, AskJeeves, and LookSmart give their side of the story. Each one spoke on how their company makes money from search, the economics and business of search in general, along with the factors for their own growth and monetization.
"From the point of view on Wall Street, search has been a great source of revenues and profit," said moderator Safa Rashtchy, Senior Research Analyst for U.S Bancorp Piper Jaffray. All four companies on the panel concurred, each reporting huge gains from the previous year.
"We are increasingly seeing companies -- that before were only doing brand types of advertising -- embrace search marketing as a good venue for them to get users and get business as well," observed Sheryl Sandberg, Vice President, Global Online Sales and Operations for Google.
Some of the core components of a search engine's monetization approach include the following:
One of AskJeeves' challenges was how to differentiate itself from the most well-know search engine - Google - by doing something unique with its own search product that people find appealing. "What differentiates us is that our audience is used to giving broader type queries," said Jim Diaz, SVP of Sales and Business Development for AskJeeves. "A substantial majority of people that come to our site will ask more than three words in a typical keyword query. That's substantially higher - even off the charts - compared to most search engines, where you typically get one or two queries."
"We're not trying to out-Google Google," added Diaz. "Unless your product is different and offers something unique to the user, it's going to be very difficult to make a name for yourself and stick around in the long-term."
While many individual performance models were described, paid inclusion was a particular issue of contention between among audience members and the panelists. The search engines touted paid inclusion being one of the most effective monetization strategies that successfully delivers more relevant results. Yet some in the audience expressed concerns on how it might be affecting the relevancy of search results. "How can search results be relevant as Google's results if paid inclusion is such as important part of each of your programs?" one audience member asked.
"We believe paid inclusion actually helps us with commercial relevance," responded LookSmart's Mamone. "The best set of results sometimes is actually a set of results is from advertisers. Advertisers can equate to relevance for commercial query for the user."
"For Yahoo, we find paid inclusion helps drive quality of search results up," stated Cadogan. "Sites that have deep content, not normally accessed by crawlers, can have their information presented to the users."
Google was the sole company on the panel that has no paid inclusion program, and reiterated that the company has no plans or intentions of incorporating one. "We believe the most relevant results come from naturally crawling the Web," said Google's Sandberg. "We do want to crawl the deep content and the dynamic pages, and we believe that by continually improving on Google's span and reach of our crawl, as well as how often we crawl, we can continue to provide relevant results for our users."
Cadogan offered some parting words for the audience on how major search engines view their monetization strategy as to the benefit of their advertisers, partners and users. "A search engine company's focus on the best user search experience first; the monetization strategy is not something that goes along side of the user experience. It is part of the user experience."
Grant Crowell is the CEO and Creative Director at Grantastic Designs, Inc., founded in 1993 in Honolulu. He has 15 combined years of experience in the fields of print and online design, newspaper journalism, public relations, and publications.
A longer version
of this article that goes into more extensive detail about search engine monitization issues, including how the services balance the need to make money with providing the best possible search experience to users, is available to Search Engine Watch members.
|
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