What? Didn’t you know? You didn’t get the memo? You aren’t one of those complaining about poor rankings or lost traffic are you? Because we have undisputed proof that Penguin has been massively successful. That’s right. It’s responsible for a 42% increase in revenue. Didn’t you see that on your site as well?
Oh wait, I guess I should clarify things a bit. It has been a huge success indeed (if you work for Google). Yeah, we now have hard core evidence backing up everything we’ve been telling you for months – that Google doesn’t care about search results, they only care about AdWords revenue. Don’t believe me?
Well, that’s ok, you can read it yourself because it’s not a matter of speculation but hard fact. It actually slipped by us and I just recently found this article from a couple of weeks ago when Google announced their earnings report.
July 20th, 2012 – Last night, Google announced some pretty good earnings, beating expectations, making more money than ever with really nice profits.
In short, revenues up about 35% from previous second quarter in 2011. Why, maybe due to a 42% increase in paid clicks over the second quarter of 2011.
Webmasters and SEOs at WebmasterWorld say paid clicks are up because organic search results are poorer and Google is showing more ads in place of organic results. They point fingers at the Penguin update.
So how does that make you feel? For me personally, well, it just solidifies everything I already knew. Google is relying on the fact that most people are conditioned to use it and think that online search equals Google. In fact, I would actually take that one step further and say that there is a significant portion of the population that equates the Internet with Google. They are absolutely relying on the fact that people will not even go to other search engines because they’ve got you trained that they are the best. Hogwash.
If you are still under the false impression that Google cares about YOU or that they care about YOUR SITE or even that they care about search quality, well, I’m sorry to be so blunt but it’s time to “wake up”. In the past when revenue was down, Google would adjust the Adwords “broad match” algorithm so that unsuspecting advertisers wouldn’t realize that all of the sudden their campaigns weren’t doing so well.
By changing the algorithm and making it more broad, they essentially reduced conversions, increased the clicks they would get and generally decreased the overall effectiveness of the ads. But one thing they didn’t do was hurt their revenue. No, not that. In fact, they boosted their revenue – at their advertiser’s expense.
Google played this game for quite awhile and eventually those in the know stopped using the broad match keyword matching in Adwords altogether focusing on very tightly coupled exact match campaigns instead. Tools were created that generated thousands of single keyword AdWords campaigns in order to learn which keywords were converting and avoid the ambiguity of broad match campaigns.
Why am I talking about AdWords?
Simple. If you’re talking about Google then you are talking about AdWords – one way or the other. That is what drives their revenue. That is what drives their business decisions. That is what drives their algorithm changes. That is what had driven Penguin and Panda too – don’t be naïve.
Follow me through this logic for a minute. Google allows you to “buy” top rankings – all you have to do is pay top dollar and you can rank #1 in Google every day of the week. In fact, they’ll even highlight your results in yellow to make them stand out. All you have to do is pony up more money than your competitors.
Now, who can do that? The big companies and, trust me, they do. And guess what? They have the money to spend. In fact, they are Google’s ideal client. Now, let’s put this into perspective a bit. Way back in 2010 – sounds like ages ago when I say it that way doesn’t it? But honestly, when it comes to Internet years, that’s like 17 years ago. Internet years are kind of like “dog years” – about 7 years to the human year.
Well, here’s some AdWords stats from way back in 2010 (and for just one month I might add):
adAge obtained an “internal Google document” that disclosed the first half of 2010 AdWords advertising spend of Google’s customers. As you can imagine, the numbers are pretty revealing.
It showed that $574 million was spent, where 1,356 advertisers spent between $10,000 and $100,000. It also showed that AT&T was Google’s largest AdWords customer in June 2010.
Their top 10 clients spent over 44 million on AdWords. You’ve heard of the 80/20 rule, right? Well in this case it’s far more exaggerated than 80/20. Out of 1,356 advertisers and $574 mill total ad spend, the top 10 accounted for 7.7% of their income. Just to put that in perspective those 10 only represent 0.7% of their customer base. So less than 1% of their advertiser base was generating nearly 10% of their revenue.
What that means is that it is in their best interest to continue to skew the results (hint: the algorithm) to favor big sites and big spenders. It’s only pure speculation, but my guess is that the top 10 in 2012 would probably account for more like 9% or 10% of their revenue. In other words, I expect that those percentages are even more lopsided. But again, that is just my speculation based on other trends that I see.
Remember, this was “way back” in 2010. Also please note that that was only for the first single month of June. So I really want you to stop and think about that for a minute. In just 30 days they pulled in $574 million and $44 million of that came from just 10 advertisers and those numbers are over 2 years old now. By the way, those numbers come from leaked internal Google documents, so they are by Google’s own internal accounting.
Google generated $28 billion in ad revenue from AdWords in 2010. In 2011 that number when to nearly $38 billion. Do you see a trend here?
So it’s time to step back and really reassess your efforts and your priorities. There is a very concerted effort on Google’s part to force more and more traffic to their paid advertisers and recycling it amongst their own network of sites. For example, have you noticed how many YouTube videos are on page one lately? I did some searches and found as many as seven YouTube videos at positions #1 thru #7 for some keyword phrases.
Google slaps you silly if you engage in any form of traffic arbitrage and yet they are the single worst offenders on the Net in recycling their own traffic and forcing you to jump through their hoops. Now they’re even scraping content from other sites and using it inline in their product displays within the SERPS to hijack even more clicks.
And, if you are not truly convinced yet, then you have to check out this article on SeoBook.com.
Mobile Ad CTR
Wordstream recently put out an infographic where they suggested that 64.6% of search result clicks on highly commercial keywords are clicks on AdWords ads. Shortly before Google’s quarterly announcement RKG put out their digital marketing report. In it they highlight how search ad CTR differs by device.
Please take a minute and check out the images / screenshots on that article showing what is actually displayed on the displays of phones, ipads and other tablet devices searching in Google. In many cases the entire screen is filled with AdWords ads. And in the cases that it’s not, there is maybe one other search result displayed. So the competition for mobile SEO has been reduced from a competition to get into the top 10 to simply – be number one or go home.
Where is the future of Google SEO headed?
Well, I don’t think you have to be a rocket scientist to realize that Google is going to continue to be the 800 pound gorilla and will continue to throw its weight around to keep as much of the search traffic within their own network of sites as well as push as much traffic to their own advertising network as possible. Can anything really change this trend?
Yes, absolutely. You can change it. But to do so you have to simply stop using Google altogether as well as all of its tools, other web properties (gmail, youtube, google docs and the 100’s of other wildly successful sites). Yeah, I know, that’s a pretty tough sell – even for me and I’m hardly a Google fan club member. The problem is – like a virus –they have completely infiltrated the Net at such a high level that I’m afraid this trend will get much worse before anything ever changes.
I do believe it will change. Maybe that’s just optimism on my part, maybe it’s wishful thinking – but I do believe it will change. The question is how long will it take for everyone to wake up to all of the crap they’re pulling and make the sacrifice of moving to other alternatives in all of the respected channels. But here’s the thing, it’s really not a sacrifice, we’ve just become lazy. Many of the alternatives to Google and Google related offerings are actually far better. But they have brainwashed the average consumer into the mentality that bigger is better. Yeah, whatever.
Anyone else feel like we’re back to pre-tivo days?
So, while I’m on a rant here, let’s talk about youtube for a minute. Have you tried to watch a video lately? It’s as bad as trying to watch TV before there was Tivo. Google is craming ads down our youtube video consuming throats like the champ at the hot dog eating contest is devouring Oscar-Meyer’s one after the other.
It’s getting so ridiculous that it is totally ruining the entire Internet experience. TV advertising fell off due to Tivo and other DVR technologies and pushed all of those 100’s of millions of ads into the Internet and now they’re taking over like a virus.
My prediction for the next coming years is this. Right now membership sites thrive by providing quality content. In the near future I predict that more and more sites will begin to transition to a membership model that is advertisement free. I believe that people will get so fed up with all of the advertising being force fed to them that they would rather pay small membership fees just to avoid being bombarded by the ads. Pay attention, because I really don’t think I’m that far off track on this one.
So, what do you do about it? Google dominates everything…
Well, see this is where I think so many people miss the boat. While Google does truly dominate search traffic, when it comes to traffic as a whole, they are just a fraction of the Internet traffic out there. Until you’ve invested in paid traffic via media buys, banner ads, PPV, PPC (on other sites, not Google) you probably won’t believe me. But I can assure you, you can get more clicks in a matter of minutes with paid traffic then you can get all week long via Google organic traffic.
Not only that, but it is just as targeted and easier for you control. After all, with Google, you have no control at all – the Penguin should have drilled that point home by now. Paid traffic, on the other hand, is entirely controllable and the sources for it are only increasing.
Getting a paid traffic funnel in place for your site that grows your list and at least breaks even on the front end should be your single biggest goal in terms of traffic strategies right now. If you already have a working paid traffic funnel, then look to improve it and supplement it with other parallel niche or sub-niche funnels as well to broaden your reach. The time is now.
Stay tuned for a follow up post with more about what you should be doing now to redefine your SEO campaigns.
What are your thoughts? Let me know with comments below.