The Seed Capital for Startups Blog

Memo to Yahoo

If you guys are serious about recovering all that lost market share in searches try this simple idea.

Unclutter your homepage.

When I'm about to begin a search, I don't want to see flashing ads for minivans,  irrelevant news story headlines, sports scores,  and pictures of the latest teen idol. I just want to focus on my search.

Over the past year or so, I've begun to realize that Yahoo search results are superior to Google's, in most cases.  If you pay close attention to search result comparisons between the two big SEs, you will notice that the first few pages of Google results are jammed with mostly old dinosaur sites. Why? Well, Google places a great deal of weight on the number of incoming links that a site has.  This means that old sites launched back in the mid-1990s, when everyone was into exchanging links, dominate Google's search results today.

The problem with this approach is that Google moves at the proverbial glacial speed in indexing new sites. Often the new sites have far superior content to the old. But since they haven't had time to accumulate thousands of "incoming" they may as well not exist--at least as far as Google is concerned. A further issue that works to the detriment of Google's search quality is that we now have what I call "link exchange fatigue". New sites have a far tougher time collecting incoming links than did sites ten years ago when everything on the Net was fresh and new. Think about it. Those sites that already have the links have no incentive to link to new sites.  This makes sense. Why help new competitors?

Thankfully, SEs like Yahoo place far less weight on the number of incoming links and focus instead on content relevancy which is what searchers value.

How do I know this? One of my companies launches and operates online businesses. We have noticed that when a new site goes up, Yahoo and most of the other SEs will have it indexed within a month. Not Google though. No, sir. It will take over a year for the new site to appear on the Big G. Rumors on the various sites for webmasters claim that Google deliberately stalls properly indexing new sites in order to force them to spend money on its Adwords pay-per-click advertising program for exposure.

I suspect that this is true.

One wag summed it up nicely:

   "Isn't Google a verb now? Enshrined in the lexicon of technology to forever mean 'Search' " ?  Well, maybe to people who still think AOL is the internet.  To all of my techie friends out here in Silicon Valley it means, "First three pages of any search are filled with SEO spam and linkfarm bullshit."

So Yahoo, unclutter your homepage.  That uncluttered homepage was a huge factor in Google's early success.  It's what attracted me to switch. So get rid of all the garbage and offer a nice clean page for search starts and watch a reverse exodus from Google back to your site.

It's that simple.

The First Crack in the Monopoly

Yahoo's version of Adsense begins. Yahoo will run its ads on 2000 sites and blogs. Participation is by invitation only--for now.  Here's an excerpt from the NY Times article:

   Yahoo appears to be focusing on a weakness in Google's offering for small publishers, said John Battelle, a blogger and author of "The Search," a book on Google and its rivals to be published in September by Portfolio Hardcover.

  "Google is the 800-pound gorilla and until now there aren't even any chimps around," he said. "You hear two complaints over and over again: They are a black box and you can't get anyone on the phone to help you."

http://www.nytimes.com/2005/08/03/technology/03yahoo.html?ex=1280721600&en=b3463ef2cae95496&ei=5090&partner=rssuserland&emc=rss

Check Your Adwords Settings!

Google is in my dog-house these days.

When you use Adwords today you can configure the distribution of your ads to appear on 1) just Google SERPs (i.e., search engine results pages) as "search content", 2) as "network content" on other peoples' sites, or 3) both.

When I first started using Adwords back in early 2003 the only place where Adwords ads appeared was on the SERPs. This was fine as it meant that only people in the process of conducting a search, on say widgets, would see widget ads.

Then one day in mid or late 2004--without warning-- Google started showing these ads on other sites. (i.e., as "content network" distribution). I quickly realized that the clicks generated by surfers at other sites were not generating any sales.  They just drove up my Adword's expense.  So I turned off the content network distribution switch.

Shortly after Google tried to entice me back into allowing my ads to be run on its content network with promises of reimbursements. The more I spent on these ads the more I'd get back up to a ceiling of $2000.  From this I can only assume that there was a mass exodus by advertisers from content distribution.

I said "no thanks", and double-checked that the settings disabled distribution of my ads through the content network, and forgot about it. This took place late last year.

Well, last week I discover to my amazement that for the past 6 months or so my ads have been running on other sites. I didn't turn the switch back on and no one else has access to my Adwords account.

When I complained to Google they told me that I must have made the change and then forgotten about it. They had no response when I asked why they had then tried to entice me back into using content network advertising.

So, I'm going to have to eat the added costs of those content ads.

How did the content network switch get turned back on? I can't really be sure.  Adwords is constantly upgrading its system and adding new features. Maybe one of these events "accidently on purpose" bumped the switch back on?

Once again, I look forward to increased competition in contextual advertising from the soon to be launched Microsoft and Yahoo programs. This de facto Google monopoly is bad for the little guy.

Sacred Cows of "the Internets"

People are starting to get ticked off at Google. Someone tipped me off to www.fuckedgoogle.com recently.

What has happened to Adsense? 18 months ago many publishers used to earn fifty cents to a dollar per click on average. Some clicks earned as much as $2. These days it's well under a dime a click. In fact, many clicks for the same ads now generate as little as 3 cents a click according to the webmaster grapevine.

Yes, it's basically the same collection of advertisers as before. Same sites too. But the earnings for publishers have sunk like stones in a pond.

Meanwhile, Adword rates are climbing while their performance is sinking as well. One of our sites used to have a sales conversion rate of 1%, which is not bad. Now that very same site (nothing else has changed) has about 1 sale for every 450 Adwords clicks.

In a nutshell, Adsense revenues used to cover Adwords expenses for many sites. Not no more, folks. Now Adwords costs real money and webmasters are starting to explore their options.

I am hearing this lament from scores of website owners.

Fortunately, serious competition for both Adwords and Adsense is finally starting to arrive which promises to end the de facto Google monopoly in online advertising.