Google still thinking about search, apparently!

English: The relationship and evolution in Int...
English: The relationship and evolution in Internet Search Business (Photo credit: Wikipedia)

I was struck by how seldom I hear of Google’s search endeavours when I read about the recent release of their updated Search Algorithm, codenamed Caffeine. Given Paid Search accounts for 96% of G’s revenues you’d think it would be the focus of most of their efforts? It doesn’t look that way. Can Google’s solitary cash cow really be getting too little focus from the Mountain View Mafia?

The Caffeine Algo promises significantly fresher results as well as an adapted architecture etc etc – but it’s primary focus has to be on maintaining revenue momentum when the vast majority of effort seems to be focused elsewhere. More than ever, Google has to defend its position in search, not only is Microsoft is about to land its much vaunted Yahoo! partnership providing the first real chance of competing with Google, but there is the problem of a wholesale shift away from Web Search as the primary navigation tool in favour of Social tools such as Facebook and Twitter.

The cracks are already showing, Google’s Q1 Revenues were $6.77bn, up 23% from last year of which 96% relates to search. Clearly Google’s revenues will be hard to improve on through share gain, given their already dominant position, leaving only the increase in Internet Population, Searches per User and Revenue per Search as the growth levers. Google’s numbers show only a 7% YoY uplift in Cost per Click and a 15% YoY uplift in Paid Clicks, so that leaves only the Growth in Internet Population and the number of searches conducted by each to fuel growth – each under threat for the reasons listed above.

Taking a very long  term perspective, Apple and Microsoft were incorporated 25 and 35 years ago respectively, it looks like Google’s Cash Cow will dry up long before they find an alternative source of revenues and never at the yields offered by Search. The fan boys won’t be pleased.

Loyalty before clicks and other delusions from a time before Social Sharing

Rupert Murdoch has asserted that page impressions generated via search engines provide little value to advertisers versus impressions generated by loyal followers of his web properties. Crikey, I wonder how he feels about the Frictionless Sharing?.

Of course Rupert Murdoch would love to drive loyalty by forcing every customer to set his homepage as their homepage, but he can’t, users are empowered to choose where to go next so it seems oddly quixotic of the world’s most seasoned newsman to assert such an ideological view, or, is so much at stake for News that he was willing to assert a patently ridiculous position in the hope of turning the tide back toward walled gardens? Maybe he’d seen the iPad by that point and he wished the entire web would look that way!

Obvious history: Jerry and David’s Guide to the World Wide Web helped drive the democratisation of the web by providing links to sites they thought were interesting, over time the service became Yahoo! Web Search as the web became to large to provide a suitable list and they switched to an anonymous algorithm for scale, today’s Google is just an evolution of that algorithm. Publishers soon realised the algorithm could be manipulated and invested significant sums in Search Engine Optimisation to surface pages from deep within their content portals. Although doing so effectively drove users away from Home Pages in favour or Web Search Navigation – so look how empowering web search worked out for publishers in the long run! In the online equivalent of scissors paper stone, Search beats Publisher every time. <<UPDATE>> Just spotted a good article from the very smart Mark Cuban , albeit it was written long before I wrote this!

But now even Search may be losing it’s place as the primary navigation tool of the technoratti in favour of social sharing, (which is really a scale version of Jerry and David’s list but with your contacts providing the recommendations in place of two nerdy kids from the Valley). And Search can’t compete as a recommendations engine when compared with recommendations from your like-minded friends.

Social Sharing is here, savvy publishers and those with most to gain have already adopted Sharing and are actively driving a new recommend / consume habit cycle amongst users. Publishers who resist adding a Share box like the one below to each article page may well grow advertiser yields in the short term by offering a deeper understanding of their loyal audience, but they may also be missing the point. Social sharing should be embraced, as should Search for that matter, as well as any odds and sods miscellaneous user that comes to their site for any random reason. Content providers should be focused on making relevant experiences visible through intuitive navigation to drive social referrals and page impressions per user, reducing their dependency on both Search SEO and the existing Home Page and instead creating a customised home page for each user as they land in an article page they clearly care about. For yield they should invest in advertiser platforms that provide audience insights and behavioural targeting, easily making up the revenue gap left by flirting with a less committed audience.  

With the democratisation of the web came the growth of the Long Tail. Search brought accessibility to the Tail where the smartest SEO was driven by those with the most to gain, Social Share on the other hand is a meritocracy at work brining opportunity to publishers large and small. Although only to those who embrace it of course!

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Should the power of Social require any reinforcement, check out the following vid summary from Socialnomics’ Erik Qualman

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