This article takes a quick scoot over the major similarities and differences in interfaces. I expect to dig into specifics in more detailed individual articles. I intend that the next detailed posting will be about how the two systems handle integration with web analytics for tracking and conversion handling, and how easy or difficult the systems make it to track search behaviour.

Identifying the audience differences is somewhat difficult to do, as this may expose too much about our clients. I’ve been wondering about how to discuss the differences in audience behavior, and if I come up with a solution that preserves confidentiality, I’ll find a way to discuss it.

Similarities

AdWords and Y!SM share a lot of features, where previously there was a radical difference of approach. Rather than spend a long time dwelling on what Overture used to do, let’s look at how the new Y!SM compares:

• Grouping Keywords in AdGroups
• Multiple adverts per keyword - supporting parallel A/B testing
• Basic match and extended match (AdWords’ Phrase Match is closest to Y!SM’s Standard Match - both get wild with Broad Match/Advanced Match)
• Dynamic Keyword Insertion
• Conversion Tracking
• Generalised Second Price Auction - Your bid and your advert effectiveness combine for placement.
• An editorial review process - assurance to publishers of quality adverts (revenue and “decency”)
• Separate Display and Destination URLs
• Default subscription to the contextual match service (AdSense or Yahoo!Publisher network)
• Text Adverts for paid search results - graphical adverts are featured on contextual match
• Bulk Upload mechanism (AdWords Editor vs Y!SMs direct import of spreadsheets)
• API - both offer a way to write software that helps or manages the account, but Google makes it easier to access
• Built in click-fraud detection - both deliver billed clicks but neither account for unbilled clicks

Display URL Improvements

Y!SM used to only allow a Destination URL and used an uncertain method to identify the proper Display URL. This was most often a problem when using a third party redirector for advert management - stuff like the Atlas DMT package, or Nedstat’s Web Analytics would sometimes show that the advert was for “Atdmt.com” or “www.sitestat.de”. The new platform removes that problem.

Policies on the use of the Display URL appear to be broadly similar. For example, neither like Duplicate Serving, having two adverts for the same advertised site.

Advert Formats

Y!SM has leaped ahead of Google in certain fronts. The Advert Generator and the wider range of shown formats (short and long form description) allow easier creation and testing of copy, and give opportunities for more publishers to present something that makes sense in their display context. Although Google doesn’t make it clear when composing adverts, they do represent adverts in a variety of formats - Y!SM’s more explicit handling of adverts better supports understanding what the advert will look like.

For example, Google’s Gmail shows AdWords adverts. When using webclips, it will show them in the format “Headline, Display URL, Desc Line 1, Desc Line 2″, as shown above. Advertisers who rely on the headline being followed by the first description line, will get a less readable advert. Additionally some AdSense publishers cut adverts back to just the Headline, or strip the Display URL. Possibly they fear that viewers might key the URL in directly? Possibly it is for space saving - more ads per inch? I don’t really know the reasons to do this. Y!SM’s advert composition and generator is arguably better for making more effective adverts in all the formats that will be published.

Google’s Faster Rate Of Evolution

Google still scores heavily on certain fronts, though:

• Google Campaigns offer country and smaller geotargeting - Y!SM still appears to need multiple accounts for multiple countries
• Google Campaigns offer language targeting - I can’t see that in Y!SM, but I haven’t really used Yahoo outside English speaking countries
• Google very recently added more control over the publishing networks, via the UI (e.g. drop Domain Parks, Error Pages, photo sharing sites, etc)
• Google spend is set at the level of budgets per campaign - Y!SM’s still seems modelled on a budget per account - I use this Google feature for all sorts of purposes.

Summary

Yahoo!Search Marketing, the original pioneer in paid search marketing, is now clearly trailing Google in both global market share and the sophistication of control that can be exercised by the expert marketeer. The newer interface has done a lot to catch up, and in some respects, offers better presentation - though I can’t currently identify better control.

Basic functions are pretty much a mirror of each other. Keywords are assigned to AdGroups, AdGroups trigger a pool of Adverts. Advert selection may be optimised by the search engine. Bidding seems to be based on the Generalised Second Price Auction. This will get some in-depth attention in a later article, as I think there’s a fundamental difference in approach by Google and Yahoo!Search Marketing for the mechanism of the auction, which affects the value the auction returns. I think this may be one place where Google might want to copy Yahoo!Search Marketing’s lead, but would probably involve a significant re-work of the entire auction mechanism.

“Part Dieux”? This is part deux (”Two”, in French) of the series, and is a deliberate pun on “Dieu” (”God” in French). Why this pun is amusing is left as an exercise for the reader.

• Project Virgle - The most surprising thing was the test result that described me as normal. My wife is convinced that I’m from another planet, and it is much further away than Mars…
• Frank, The Hand Turkey - Maybe I’ve been out of the US for too long.
• The Aussies.

The most confusing incident was that I suddenly started noticing adverts in my Gmail account for “Run Your Car On Water“, on the morning of April 1st. I decided that this must have been a spoofed advert. Only I *still* see it. I think it must have been an unfortunate accident of timing. Looking at it, it just feels like a spoof - appeals to authority, little talking people on the page bottom, and, of course, you’d save money and the environment - except that the physics seems completely bogus. Someone tell me that this is really a joke, please?

So, let’s suppose that Google takes a cold hard look at the competitive landscape, much as they did with the recent 700MHz spectrum auction. From what I’ve been reading, Google bid $3.7B and would have been disappointed if they’d won - but it drove up the price and forced a competitor to do something that Google wanted. Might Google be equally subtle with MS and Yahoo!?

How about this? If Google annoys a substantial fraction, especially of small and niche advertisers (lots of them, relatively small revenues in Google’s terms, no profound feelings of mutuality on either side), what is their rational response? Defection? To where? Yahoo! and MSN AdCenter, and possibly to some of the third tier players.

If Google loses, say, 10% of the revenue expected for this Quarter, it makes a massive increase in the revenue potential for Yahoo!, and possibly for MSN. Google’s loss of 10%, makes, if I calculate this correctly, about a 20%+ change for Yahoo! (assuming that online advertising budgets are not reduced, just redirected). I’m not a stock market expert - but wouldn’t this expectation of return for Yahoo! start to drive up Yahoo!’s price? If Google has, according to analysts, stalled or even lost share, then Yahoo!’s performance looks even more remarkable, and the share price cranks up?

And, for Google, this is easily repairable. After the market play, Google turns to advertisers and says “Oops, mea culpa, we goofed - we’ve made AdWords work properly again.” In a quarter or two, the revenue stream is back at Google, or even enhanced (everyone loves a Big Friendly Giant).

Did I make my coffee too strong this morning, or wake up light headed and incapable of rational thought? What did I miss? Is this *subtle enough* to explain why Google would trash so many small advertisers and risk their reputation?

Should the rational response be to drop spending or just redirect it to Yahoo! and MSN, or is there a smarter strategy for advertisers?

I’m still thinking through the implications. Your thoughts are welcome :)

Oddly, in the UK, two adverts consistently show up on a search for “No Country For Old Men DVD”. So these must be super-relevant? Something about the advertiser or the landing page or the AdCopy must have sneaked these past Google’s filters and reviews. I decided I needed to see what was special about these adverts. I clicked on each advert in the results below:

Absolutely fascinating… Here’s a clip from the Ice Gadgets Landing Page:

It has the keywords on the LP. It has a photo, and a YouTube clip, information about the movie and a low price. All good stuff that should excite a searcher to buy. What about the DVDCrave web site?

Eh? Follow a link from a search for one film, an advert for that film and you get shown a completely different film?

But other relevant advertisers are being suppressed?

What’s the point of denying relevant adverts, and allowing irrelevant responses to adverts, to be shown? I think it is a symptom of a deeper illness at Google.

Other Evidence

I have clients with highly relevant, high CTR adverts, and conversions (proof that search users found the adverts to be relevant and useful) who have had their businesses crushed in the latest round of changes. They aren’t getting more than a tiny fraction of the impressions that they used to have. The adverts that do run are getting CTR’s in the range of 11-60%. But the *volume* of searchers is now so low that the businesses are no longer economically viable.

What Is Google Doing?

Is this is economically criminal? The US mismanagement of poor quality loans is already endangering the world economy. Now, the world’s leading resource for directing online spending, appears to have started destroying businesses.

When your advertising system controls the flow of a substantial fraction of the online economy, you can’t just play with it the way that you want. It has a direct global economic consequence. Perverting the system the way that Google appears to have done, helps to reduce confidence - that intangible on which economic value is founded.

Google is directly contributing to a loss of confidence in small and larger advertisers, but not because the economy is tanking - it is because has deployed, unannounced, a new set of advertising rules that have destroyed the old AdWords model of relevance.

Idiots.

What possible reason would Google have for wanting to make paid search into a pointless activity?

Search History Permutation is a strange move, at least for niche advertisers.

Suppressing irrelevant adverts is a plausibly smart move. But the selection of what is irrelevant is clearly flawed, as conversions are being reduced.

If Google is going to trim down the number of advertisers, then it *MUST* make sure that those remaining are actually the best adverts. Otherwise the confidence of searchers will be destroyed, as well as the confidence of sellers.

Summary

I’m pointing all my clients to Yahoo, and MSN. I’m recommending that Google budgets are being *zeroed* until this monstrosity of madness has been repaired.

When Google can deliver an advertising system that is fair and rational, I’ll start using it again.

Look forward to more posting about Yahoo and MSN advertising behaviour - until now, they’ve been a minor part of our activity, so I rarely write up what I see there - they’ve been too small a part of the UK online advertising scene to be important, and while some of our US clients have Yahoo! accounts, it used to be the case that the core business was driven on AdWords results, with anything else being a bonus.

Now that AdWords is a statistically irrelevant advertising medium, Yahoo & MSN are *the* most important players in online advertising.

Updates

2008-04-07 Impression rates in clients are now trending up - but still sustaining higher AvCPCs. While I’d like to claim that impression volume increase is our smart management of accounts, I’m pretty sure that it is really more to do with changes made at Google’s end. There are still effects in damaged conversion - accounts with multi-year histories of increasing conversion volume and decreasing average conversion cost, saw damage in early March, which is now beginning to show signs of recovery - not caused by the 30 day accumulation of conversion. Looks like Google are correcting some of the excesses of the new algorithmic regime.

Moderated some of the language in the “Idiots” section as a consequence. I still think that the unannounced spanner that Google apparently dropped into AdWords is irresponsible.

One client has had Google Analytics running for a few years - so I can do some basic time series analysis. If I do a cross correlation on impressions, click, visitors and conversion rates, they are consistent from Feb 2006 until approximately March 1st this year. Now, that’s *after* the first point at which I became aware of Search History Permutation. So there may be something else going on, too.

Search History Permutation Signals

If you have been hit by this, then Search Queries will start turning up in web analytics, that have one or two words that you’d normally expect, and some other odd words that you might not expect, or combinations of words that you would expect to see in different keywords. For example, if you are advertising using “free dentistry” and “dentist poughkeepsie”, you might see search queries for “free dentist”, “free poughkeepsie”, “dentist dentistry” and “dentistry poughkeepsie”, as well. Some of these are similar to the sorts of expansion that Google does already with Broad Match. If you used “free dentistry” and saw “free dentist”, that is exactly the sort of expansion that Broad Match is already capable of delivering. However, “free poughkeepsie” is *not* normal - well, not for a dentists keywords, anyway.

How frequently you get hit by Search History Permutation will depend on the precise mix of keywords that you have in the account. If you happen to have keywords where searchers will typically make consecutive searches that each include a word from your keywords, then you might get dragged into unexpected auctions to advertise for searches that you don’t expect to appear in.

The frequency appears to be highly variable - but only for certain types of account. What distinguishes those accounts? They are high bidders, with niche keywords. When searchers have a set of searches combined, then the rare niche keywords are triggered at an abnormally high frequency. Because the bids are high, these adverts are conscripted to take part in auctions where the real search is very different from the targeted keywords.

In accounts with low bids - perhaps because, like travel, the industry has a lot of browsers and relatively few bookers on any one day - the effects are less easy to see, because most of the combinations that will be generated, end up either with no advertiser (”cheap family” - taken from consecutive searches for “cheap holiday” and “family holiday”), or with plausible Broad Match relevance (”holiday holiday” would be a plausible synthesised search, which would trigger Phrase Matched and Broad Match holiday adverts).

So the signal will be, in many accounts, subtle and all but invisible. This means that regular activities, such as adjusting bids to keep inside ROI or profit targets, may conceal the effects. There will be a small proportion of advertisers for whom the new Search History Permuted Searches form a substantial fraction of their impressions. These are the advertisers who suffer - but they need those peculiar combination of search queries to trigger them.

Looking in detail at some mass market and lower bidding clients, suggests that the frequency of unusual search queries is about 1 in 30 to 1 in 60 (about 3% to 1.5%). This is hard to distinguish though, because I normally run some Broad Match keywords in these accounts anyway, and Google’s natural extension of Broad Match could have snared some of these searches. The frequency could plausibly be as low as 1 in 50, and Google may have turned up the dial on Broad Match to capture a wider range of queries (which, if you’ve read the previous articles, means that the auction will tend to generate more money, because each auction will usually include more bidders and that drives up the paid price).

New Signal?

Cross correlation is a statistical technique that asks “how similar are the variations in these two data sets”. If I have a daily record of impressions, for example, I can break it into two periods, and compare, as in thi case, Feb 2006 to Feb 2007, with the range Feb 2007 to Feb 2008. I get a strong correlation co-efficient, meaning that every year, the pattern is pretty similar. It is even better when I leave out the fixed holiday dates - Christmas and New Year fall on different days of the week.

Looking at my mass market clients, I can see that there may be a signal of broadening Broad Match, aside from the Search History Permutation. I have accounts where I have managed the daily spend to approximately the same budget spend for ages - given that there is a weekly profile of search, when daily variation is expected, so long as the weekly profile is maintained. These have suddenly escalated since March 1st. The bids were the same, the keywords and adverts the same - and thousands of active keywords are involved. Why would the paid price escalate, suddenly?

This may actually be other side of the Search History Permutation, though. Consecutive searches mostly include implausible searches that wouldn’t trigger anything, or plausible searches that weren’t part of the current keywords. So in a small number of occasions, additional advertisers are recruited. This pushes up the bids. Even an appearance as low as 1 in 40 (2.5%) causes a measurable price change in the auction, when you have a hundred thousand auctions a day.

Date Inconsistency

Now, I believe that I first saw “odd adverts”, which I didn’t immediately connect with Search History Permutation, some time in late January. A lot of AdWords advertisers make insufficient use of negative keywords, so I’m used to seeing inappropriate adverts showing up from time to time. However, I’m pretty sure that the effects were visible, at least sometimes, in January 2008.

So why do most of my accounts that show a change, show it from March 1st, rather than January the somethingth?

I have no idea. None whatsoever. I’m worrying at this discrepancy. What if the changes in prices and impressions that I’m seeing are not caused by Search History Permutation, but some other algorithmic tweak?

Well, I do see *some* visible effects - there are some odd searches in the logs - odder than I’d expect to come from Broad Match.

You know the biggest signal that I’ve found something? Visits from the part of the world that mostly houses Google, to the blog article about Search History Permutation. When the first article was published - either the Googleplex decided my recreational pharmaceutical mix was unusually strong and they couldn’t stop laughing, or I struck a nerve, because it is the highest daily readership from Palo Alto that I’ve seen - IP addresses in the Google ranges. (No, I don’t really do drugs stronger than coffee or capsaicin - sheesh, a joke).

There’s probably still a piece of this puzzle that I’m missing. Ah well, back to trying signal analysis techniques and staring at lists of keywords and search queries, bids and average paid prices. There’s some way to make this make more sense - I just to have find it.

Summary

Search History Permutation probably has an effect across AdWords on the order of about 1-2% of searches, though the effect may be more pronounced especially in niche markets.

The effect appears to be an increase in Average CPC of somewhere around 3-5%, but may be higher in niche markets. I haven’t sorted out the maths to justify this, just observations, so far.

For accounts with the right niche keywords and higher bids, the effect may be pronounced - sometimes drastically reducing conversion rates, possibly on the order of -90%, because so many of the wrong searches are brought in. For example, if you specialise in one named category of something, and bid high for it, then I think that you’ll be shown much more frequently for the mass market searches than the niche searches - and that will destroy CTR, conversion rates and profit margins.

Signs And Portents

I treat AdWords a bit like cryptography, or black box control engineering. Messages go in (adverts, keywords, bids, geotargets, etc) and translated messages come out (impressions, clicks, conversions, paid prices, etc). Google does something in the middle. It’s part of my job to infer what Google does, and manipulate inputs to optimise the output. There’s a bunch of fancy techniques that could be used (Stochastic Perturbation with Simultaneous Annealing, for example - what a wonderful name, eh?), but much of it comes down to, in my opinion, marketing messages, the buying process and micro-economics. The complex maths get their day only with large data sets and high volumes.

For small advertisers, the volume of data needed to make techniques like SPSA and Taguchi work, are hard to achieve and pay for, and subject to a lot of statistical noise caused by uncontrolled and/or unmeasured factors such as seasonality, market price fluctuations, confidence, organic search results, press releases, Google’s changing policies and procedures, the Editorial Review process, trademarking protection, and so on. Mostly I rely on techniques that appear to work in general cases, with tuning when enough historical records are established.

I determinedly read messages, signs, sigils and portents from Google - blogs, Wall Street Analysts reports, Nielsen, the occasional goat sacrificed at midnight, etc. But the most important pieces of evidence come from the AdWords account, from web analytics or web server log files, web site contents and visitor trajectory, and from looking at competitive advertising.

The consequence of a lot of thinking, experiments, and the experience derived from spending a few million of my clients’ funds in advertising budgets, is that I’ve developed some techniques that give me the most data for interpretation. I’m quite happy to share these techniques - my primary value to my clients is “insight”. Paid search work is just one tool in that shed.

I’ve found that it is most useful to focus on Exact and Phrase matched AdGroups. There’s a specific way to set these up to get the greatest signal - I’ll detail it some other time. But the effect is that even if the bid for exact matched keywords drops, that the phrase match and broad match adverts don’t run - think “negative exact keywords” and “negative phrase keywords”. Also think “This’ll Stop Google From Abusing Expanded Broad Match And Destroying My ROI”.

This technique reveals some intriguing things about users and search. Most importantly, it used to show how and when users repeated searches.

Characteristics Of Search

If you have a rare search query, as an exact matched keyword, it might only attract a few hundred impressions per year. As Google have become more experienced, they’ve started aggregating small volume queries, so this signal is harder to see now, than it was in 2003-2007. However, old records show something interesting. If you have one of these “long tail” queries, then you see that they tend to get used in bursts. You get no activity in months, and then you get a run of 2-15 (usually around three to six) searches with the same query. Then it goes quiet again, perhaps for months.

Why? Because one searcher has decided to find something and is repeating their search. I know that I do this. I’ve seen other people do it. You are trying to research around a problem and you keep coming back with the same query, perhaps to look at more results on the page, or to get a second or third page.

Patterns of search query repetition appear to vary in some ways that are amenable to analysis. AFAICS, it changes with how the search is regarded by the user (what I call the “intent”), and the phase of the buying process. If the searcher is in the early phases, then they do a lot more repeat searches. If they are late phase, for example after making up their minds to buy from a vendor - then the number of repeated searches tends to be small - they know what they want and they just have to find it. A characteristic migration of phrases might be to start with “Cheap Holiday” multiple times, then some specific searches for types or locations of holiday which may have some repetitive components, and ending up with a single search query for “Expedia.com”, “travelocity” or some other site that was identified as having the product to buy.

This evolution of search queries interacts with the new search history permutation mechanism in a regrettable way.

When a user repeats the searches, the results stabilise, and are just like the results you’d normally get from AdWords. If there’s been a break in activity, then a new search after the break duration is treated as if there is no search history. For example, type “Brazilian Tax Credit” tonight as the last search you do, then come back after a nights’ sleep and search for “US Vacation” and you *won’t* see the Brazilian Holiday and US Tax adverts (from the example in the previous article). Well, I don’t, anyway.

Prospective buyers, early in the buying process, appear to repeat searches. If these users walk up to a cold machine, boot and start searching, they see nothing different caused by the search history. However, early phase searchers are not, usually, close to buying - by definition. You can, of course, help accelerate them to purchase with the right advert copy and the right content on your site. But the general behaviour *appears* to be that multiple repeat searches are mostly coming from people who are unlikely to buy now, today.

Early phase searchers may not even be looking at paid search adverts seriously - I believe that I tend to see lower CTR’s for keywords where I regard the intent as being weak; early phase searchers often seem to use organic results rather than paid search, because organic results will often lead to pages with discussion of alternatives, while paid search typically leads to a specific solution. In other words: consistently targeted adverts are shown to the group who probably could benefit from some message variation (use those alternate creatives, marketeers!). These early phase searchers are also, typically, the lowest converting group - because they may get distracted by a different type of solution or decide to not continue with the purchase process, or the latency exceeds the 30 day AdWords Conversion Tracking or the default Google Analytics 6 month tracking or ritual cookie deletion.

In the later phases, I believe that people vary the search more. This is where they are comparing features, benefits, finding discussions and threads to justify their decision. These later phase prospects are the ones that see randomised adverts, because the search history is invoking bizarre extraneous keywords to the party.

The consequence of the evolution of search queries is that the most bizarre conjunctions of irrelevant adverts are shown to the users with the highest interest in buying right now.

This is not desirable for advertisers. This is not helpful for search users. Why do it?

Permutation

The nature of the Search History interaction appears to be a simple combinatorial permutation. That is, given “cheap holiday” and “us vacation”, it probably generates “cheap vacation”, “cheap us”, “us holiday” and “holiday vacation”. While this example generates some plausibly interesting candidate keywords for searchers, it is demonstrably weakening the answers to the most recent request. See the two examples in the previous article for details.

The core question is whether permutations of the current and previous search query generate plausible searches that the user might have made. If this was a valid technique, might we not expect it to have been used for organic search, first?

That is to say, if Google, who are probably about the largest, most rational and experimentationist entrepreneurial organisation on the planet have *NOT* used permutation to improve organic search results, why would anyone imagine that it benefits paid search to do so? I’m not aware of any previous activity in paid search that has resulted in organic search following the behaviour. I can see that Google copies lessons learned from organic search into paid search. You want some examples?

• 404 checking - 404’s are lethal for organic search, so Google verifies that paid search pages are present.
• Landing Page Quality Scores - appear to be based on what makes a good result for organic search (though I have a nasty suspicion that the nature of search evolution and the buying process implies that there *should* be a difference between organic and paid search optimal landing pages).

This paid search usage of the search history appears to be novel, and appears to offer a reduction in the overall effectiveness of searches. Combinatorial explosion also means that with lengthier queries, the number of combinations is increased markedly. Some of these may well overlap with keywords that have a higher bid and/or a better CTR - so these will be favoured over other adverts that are more directly relevant to the searchers intent.

Markets and Market Prices

OK, now we’re in the dismal world of Economics.

If I’m an advert trader, I can set up multiple markets for bidding for placement. I might set up one market for “ford prefect” and another market for “edsel”. This is like Google - there used to be a market for each keyword. Google’s Broad Match extended the search queries that were involved in the market, but usually in identifiably sane ways. So a market for the keyword “cheap holiday” could include search queries for related concepts such as “cheap vacation”, “free holiday”, places known for or associated with inexpensive vacations such as “cancun vacation” or “holiday cyprus”, and even specific company names closely associated with cheap holidays.

The more of these other search queries that I can recruit to my market, the more price competition I can engender. This is why, I think, Google likes paid search users to use Broad Match by default - you participate in a larger market and that makes obtaining a higher value price in the auction. More bidders implies a higher price from the market - I can’t currently think of a counterexample in which more participants recruited to an auction will reduce the price struck. The generalised second auction apparently used by Google, doesn’t seem to offer a way to allow larger volumes of bidders to reduce the price that is struck, compared to an auction with fewer participants.

Indeed, this observation is the entire basis of an industry - keyword finders for SEO and paid search. Find the rare keywords in which the auction includes fewest bidders, and, the argument for this industry goes, you have found the auction in which you can pay the least to obtain traffic (or use SEO to get that “free traffic”). Of course, Broad Match negates this industry for paid search to a great extent. I have (seriously) considered setting up AdWords for well established brands, in which I simply used the brand name, with carefully selected negative keywords, to do all the work. Google will gleefully match well established brands with the primary and even secondary characteristics for their main search queries. Why do work you don’t need to, eh?

So, given Google’s ability to extend an inference for, for example, the keyword “thomas” to imply “cheap holiday”, or the search query “thompson cooke” to bring visitors to a major travel site (check your web server log files and observe the mismatch between keyword and search queries - that’s where the evidence is), why would Google need to use permutation to increase the auction?

As another example, look at what happens in organic search. You miskey “erlers danlos syndrome” and it offers to correct the spelling - because the history of interactions and the nature of searches have taught Google what the normalised spelling should be. Users have become used to the idea that Google will correctly guess the question that was intended. Why would paid search uniquely require a type of search query expansion that is *not* used for organic search conceptual extensions?

I believe that Google uses search history permutation to create an artificial market. As well as related search queries, the search history drags in unrelated queries. So a chain of “Brazilian Tax Credit” and “US Vacation” searches yields combinations including “us credit”, “brazilian vacation” and so on - and you can see adverts in the primary article with these exact adverts shown. *BUT* it is a false market. These advertisers had no strong intention to appear on those searches. If they did, they’d have used those keywords - just as an organic search would have extended the searches to include those results. If Google had seen a relationship, then Broad Match should bring in those queries to the advertiser.

Is this fraud? I’m no legal expert - I have no real idea if this is technically a fraud. But doing things to paid search that you wouldn’t do for organic search at least raises the question of whether this is deceptive advertising for Google - if advertisers were operating in the reasonable expectation that search for keywords worked like search for search queries, then might Google have implicitly broken the contractual expectation for advertisers? If you create a market that recruits bidders who don’t really want to participate, so you can increase the paid price in the auction, is that fraudulent?

Local Optimisation vs Global Optimisation

I suspect that the essence of the problem is an attempt to locally optimise. For example, if you are a programmer, you can expend effort to refactor an algorithm for a local optimum, and later discover that the global performance has been damaged.

I suspect that this is what Google have done. They’ve apparently decided to stop showing adverts on searches where few people clicked on adverts. They’ve compensated for this by using a piece of information that they hold - your last search - and created a higher value market for the adverts. This increases revenue in that transaction. But I think that this creates a problem for global optimisation, and Google’s brand value - it also does very little for advertisers. Users seeing irrelevant adverts will also often blame the advertiser for stupidity, as much as they blame Google for poor quality matching.

Optimising my clients’ accounts won’t help much, though. The problem is that I can’t optimise my clients. Google has created a strange new market, apparently to boost the Average CPC at the point at which people are most likely to have abruptly shifted search focus, and are generating the most random results at the point when someone is about to buy. I can’t control Google’s recruitment of irrelevant advertisers. Even if my adverts are exactly on focus for the intent, when pushed down the list of results, I get fewer impressions and a lower CTR - because people don’t want to go wading through random garbage results. I might even get pushed off the first page. It’s simply frustrating, because it is beyond my control.

The adverts that I most need to place, are the ones that Google has apparently decided are a reasonable place to extract additional revenue from advertisers.

Monetisation

Historically, Google has succeeded by consistently producing good search results. They resisted introducing paid search until they had a model that worked - no inline search results, and an apparently rigid wall between paid and organic search results. I am in awe at the subtlety that AdWords used to have. It was a fantastic tool that I used for market research, as well as lead generation or sales.

The virtuous cycle for Google has been that good search results meant more user recommendation and so a growth of the user base. Advertisers like being able to reach a large audience.

Note how this depends on the quality of the search results page.

Evans and Wurster’s 1999 book, “Blown To Bits” (Harvard Business Press - no commission on this link, folks) was the first book that clearly explained, to me, the theoretical underpinnings of the value of Yahoo, and tied it to marketing principles that made sense for me. This book is also a great guide to monetisation and market share. In other words, it explains the economics and marketing principles behind what seems to have been a core Google strategy for the last decade:

By delivering the best page of search results, Google stays ahead of the competition, and thereby dominates search.

As we’ve seen, permutation damages the likelihood, for later phases of the buying process, that Google will give the *best* page of search results. It may be a better page than competitors, but it is not the absolute best page that Google could deliver. Arguably, when looking for a commercial solution, paid search is a better answer than organic. It depends on the market, and the state of organic results. I know that I have, and have had, over the years, clients with huge CTR’s and high conversion rates, because the organic results are wrong for final phase product oriented searches.

Does this damage the Google brand in the eyes of the search user? I think it does, and I have some clues that point to this.

Paid search vendors are intermittently criticised by industry watchdogs for failing to adequately clarify that paid search results are not chosen on the same basis as organic search results. In conversation with users, they will often hold that the number one advert shown by Google has been selected with the same or similar criterion as the number one organic search results. There is certainly a higher intrinsic CTR for the number one advert position, especially if it appears above the organic search results.

It is intriguing, isn’t it, that industry commentators and so many paid search booklets of “affiliate secrets”, emphasise that appearing as the Number One paid search result may actually dampen overall ROI. I believe that this is because it recruits searchers who are in the wrong phases. Instead of being at the point to consider purchase, these searchers are still discovering what it is they need to know, before they go shopping. They also trust Google to deliver relevant results.

What will happen to users as they approach the final phases of an attempted purchase? They will see a largely static list of advertisers for each repeated query turn into a set of adverts in which perhaps half or more of the adverts have no direct relationship to the search intent. I believe from purely personal observation and extensions of marketing psychology, that users will extend less trust to paid search results, especially when the top poistion from advertising is clearly off-topic - as it is, accidentally, in both of the test cases that I previously published.

Far from demonstrating Google’s long term commitment to improving search results, permutating the recent search history appears to weaken page relevance, and this drives down the long term monetisation of search - because it means that other vendors offer a relatively better search results page. This is really good news for Yahoo! and MSN. Their adverts will actually have a higher trust placed on them, so long as the auction is kept reasonably fair and uses only the contextual extensions that organic search would use to extend the keyword to similar *weighted* searches. If I was a user, looking for things to buy, and in final phase search, I’d change my strategy to use MSN or Yahoo! - because I’d get more consistently focused adverts, that help me achieve my ends.

Advertiser Effects

Because Search History Permutation enlists more advertisers, the effect is quite interesting. Painful. But definitely interesting. It seems to differ according to your normal bidding strategy.

If you typically bid below position 5, then you are likely to be pushed further down the page, or even off the first page. Impression rates will decline, sometime markedly. CTR will be typically somewhat decreased - but no huge decrease in CTR, I think. You should see that your average position is declining, as irrelevant adverts are brought in above you.

If you typically bid above position 5, you may be recruited to show adverts on irrelevant searches - your adverts have a high CPM, making them valuable for Google to show elsewhere. The result is booming impression volumes, as your adverts are shown on searches you don’t care about - and your CTR crashes down. I think that your average position will be largely unaffected.

Any way you slice and dice it, this looks like a poor move for advertisers.

Summary

Searchers evolve their search queries during the buying process. From my research, the greatest variation in search queries appears to happen as searchers near the actual purchase. The final search appears to consist of a single query - for the business that was identified as the right one to buy from. This is statistical inference - so for some users there will be a single search, and for other users there many be multiple repeat searches that lead to a sale; the argument is not invalidated by a single counterexample - you need a chunk of data to reveal that this is wrong.

Google’s current use of search history recruits new keywords to participate in the auction, resulting in the appearance of adverts for which the searcher has demonstrated no interest.

This appears to be something that is not in the best interests of searchers.

This appears to be something that is not in the best interests of advertisers.

This appears to be something that is intended to increase revenues to Google, by manipulating the conditions in which bids are evaluated.

The exposure to additional participants in the auction appears to allow a higher price to be returned from the auction.

This appears to damage the long term brand value of Google, at least for advertisers and probably for searchers.

It appears to offer comfort to Yahoo and MSN search - their page values are now relatively higher than they were before Google made this change.

If this isn’t evil, what is it?

If this isn’t fraudulent activity, what is it?

This appears to be yet another example of covert messages from Google that indicate how they really think. Ignore the babble about how much they love you. Google apparently thinks of advertisers as gullible stooges who are there for the money they yield. Advertisers, for Google, it seems, are a resource that demands no respect. They won’t tell you this, but it is how they treat you - sending you clicks that won’t convert is great for Google and lethal for your business. Removing Advertisers ability to control click quality is great for Google and destructive for the relationship between Google and Advertiser.

Trust is earned, but it is fragile. Google keep destroying the trust that their organic search results have built, when dealing with advertisers.

Update

2008-03-18 Slightly clarified criticism of Google, bringing it back to AdWords, in the summary. I vacillate as to how much damage this does to the relationship between Google and Searcher, and between Advertiser and Searcher. Seeing irrelevant AdWords adverts is often, but not always, blamed on stupid advertisers.

At some point (I don’t have an exact date and I’m still digging through client logs) Google changed the basis on which adverts are shown. Until this change, Google would look at what the user typed in a search query, and deliver adverts where the advertiser had selected a keyword that matched the search query. Google has not announced that they are now doing Search History Permutation.

After the introduction of the Search History Permutation, Google takes all the words in the previous search, and all the words in the current search, and jumbles them to make new search queries.

The result is that adverts mix relevant results and bizarre conjoined researches - even if the series of searches conducted by a user are related, the result of permutation can deliver completely irrelevant adverts.

This is not AdWords, as I’ve used it from 2004 to 2007. This is a different AdWords. It is less effective. It is more expensive to use. It is less under my control - I can’t find any simple way for advertisers to prevent appearing on irrelevant search queries.

Look at these two search results clips. Both searches are for “US Vacation”. But the search before these was varied. Notice that Organic Search results are the same. Only paid search has changed - and it has changed so that the top position results are irrelevant. This decreases the CTR for what should have been the number one advert. It has pushed to lower positions, previously relevant adverts, off the first page - so for some advertisers, impression volumes will have crashed. The recruitment of irrelevant adverts means that *high bidding* adverts, will get increased impressions, as they will be dragged into irrelevant searches more frequently.

The general effect of this though, will be plummeting CTRs. It’s almost as if Google was spamming its own pages!

Summary

I believe that Google has fundamentally changed the nature of AdWords, without any contractual variation or notice. If so, this is not ethical behaviour by Google, and it might not be legal - I don’t know enough about US law to say - but it really, really sucks.

I believe that the change benefits Google - by having more high bidding advertisers in every auction.

I believe that the change does not benefit users.

Longer term, I believe that this damages the brand value of Google, by destroying the basic proposition that Google offered to search users - that Google would deliver the best page of search results. By delivering adverts from irrelevant searches, Google has reduced the value of the page, for advertisers and for users.

I have a *much* longer article, that covers all of this, in more detail. :(

I don’t have the statistical databases of Google, or even a small search engine. I have an acute awareness of how I treat search, three kids and a group of people who I watch using search to find things. I also have had access or have current access to huge web server log files with data from paid search and organic search (and walk ons aka “direct” and email, and so on).

I’ve also, periodically, had formal training in marketing - paid for by me. I *like* this stuff. It’s my entertainment. OK, that might sound wierd, but I get more of a kick from figuring out why some marketing trick works than I do watching a film. It is more deeply revealing of real human psychology and the stories of our lives. Back to the point…

So, what do I see when I watch people search? What do the log files say? What measurements are we missing, as an entire Search Engine Marketing industry, because our web analytics tools don’t provide them?

The Buying Process

I keep mentioning this, and each time a few more people seem to get it. The Buying Process is pretty important in offline, but often ignored online. I think that’s a subtle consequence of how the web analytics got going and the ease of making and understanding certain types of measurements…

The idea of the Buying Process is to identify the kinds of activity that a prospective buyer goes through. By targeting the right message to the right phase, you can influence the course and speed of progress through the buying process. The offline and online models differ, I believe. In particular, the nature of online purchasing injects an extra step, that isn’t articulated offline. Here’s the basic online buying process for a simple sale (one person, small enough value to allow personal decisions):

• Needs Awareness - sudden or slow dawning that they have an unfulfilled want
• Research - Find stuff out about the perceived need, and refine it
• Comparison - read reviews, and get together the data and emotions to make a decision
• Decision - put the whole thing together and make up your mind to go for the safest option
• Acquisition - this is frequently combined with the Decision, offline; how you go about getting what you want
• Post Purchase Evaluation - do you feel good about your decision? Support? Usage?

Prospective purchasers may slide backwards and forwards between these phases. So, for example, on choosing something and trying to buy it, it may not be available or costs more than you thought - so you end up being thrown back to an earlier phase.

Search queries seem to evolve. Different users have different strategies for searching, but one common search usage model seems to map to the buying process like this:

• Needs Awareness - irrelevant
• Research - typically repeated identical searches and looking at a range of organic search results
• Comparison - typically a wider range of different searches, honing in on particular features and benefits, or problems; can be Organic, or PPC
• Decision - usually irrelevant
• Acquisition - searches for a brand, web site, or specific product name and attribute - Both SEO and PPC can help (multiple messages, increased Share Of Voice, etc), often focus on adverts - PPC CTR can exceed 60%
• Post Purchase Eval - only relevant if there is a problem, a support group or online interaction - Organic is terrific for this

Organic search tends to be great for that early phase and the post purchase phases. Using paid search in these phases can result in a low conversion rate - and a signature is that you get repeat visits from the same visitor, on the same search. Ideally, for early phase searches, you’d use the organic search activity to get someone enrolled in a newsletter or other direct marketing activity - so you can send messages targeted at their activity, with their permission. You can then avoid search, thereafter, in some cases - not all, though.

When you get to the comparison steps, depending on the product type and the nature of the comparison, PPC may work better - because the precise message is more easily shaped. Organic can act as a support - so if you know that an organic result is present to take the other traffic, you can shape the advert copy to help attract buyers closer to conversion, or who need a message that the organic listing can’t properly support - a segmentation exercise, essentially. You may also be able to get an advert up when your SEO won’t let you show a reasonable ranking.

At Acquisition phases, you can do really well with PPC - or completely crash and burn. If someone has typed a brand name, they’ve probably made up their minds. Your chances of deflecting that purchase intent are going to be very low. Even if you can get a non-zero CTR, the conversion rate is low… unless you can shape a message to a competition-killing weakness and support that with the right Landing Page. Note that SEO generally finds it hard to rank at all on a competitors name… and Google’s usage of trademarks may make this difficult to do in certain countries, using PPC. It isn’t easy, or always possible. However, when the decision to acquire is actually a decision to research where to buy, then you get a serious chance.

Effectively, when someone decides that they want a holiday in Cancun or a specific model of car, they haven’t decided to buy… They’ve gone back to Research and Comparison phases, but they are now looking for *where* to buy, not *what* to buy - they are now more likely to be looking at paid search adverts, because those can carry, for example, current prices, specific messages that you can’t or shouldn’t carry in organic results (unless using Subscribed Links - but that’s another story).

Paid Search shines here - and has another trick that is hard to manage for Organic. Now, you still need the organic listing present - because you don’t want to lose the traffic doing early phase research. So the paid advert can focus on buying messages. “Book online now” - leave the organic listing to offer “Search/Browse online now”. The advert often needs to imply that you are ready and waiting to take the order and you have whatever it is that people are looking for and you’ve got.

You probably don’t want to advertise for post purchase evaluation - but you might in rare cases. If, for example, you have people proud to use your services and products, you might let them use icons or graphics to display their affinity. This supports hard-to-measure viral activities - and getting the right page, right message and rank with SEO is fairly uncertain. Placing an advert will let you support after sales activities that may be otherwise difficult to do. Similarly, if important events have just happened, then Paid Search can usually give you a head start on getting the new messages out.

And that, of course, is the final significant difference in the communication strategic strengths and weaknesses. If your tactical needs are for fast changes - new campaigns, promo prices - then Organic is a generally more sluggish responder. This, for example, makes PPC a suitable tool to conduct practical marketing research into consumer interest - something that you just can’t sensibly do with organic search. Note that with busy sites, you might be able to get the Snippet updated, almost in real time - that’s actually faster the editorial review, without asking for an expedited review.

PPC Tricks

Some things that help PPC, are not easily available in SEO. For example, day parting (where you can specify which set of adverts run at specific times of day), and geotargeting - ostensibly reaching only your desired audience.

Depending on the business, these may be more or less meaningful. For example, in some sectors you may be able to identify that businesses are the primary users of certain queries in the morning, and in the afternoon the audience switches to consumers. PPC lets’ you tune the adverts. However, other products may not have such an easily deconstructed appeal.

Geotargeting is less of an issue for SEO - because exposure to foreign geotargets is less of a problem. Google has made a minor pigs-ear of geotargeting - confusing where you want to show adverts and where the service area is. For example, if you are selling Plumbing Services in Florida, you probably don’t want jobs in Washington State. The query “plumber” may net all sorts of SEO that isn’t useful for you - but correct application of geotargeting could yield a local plumber. IME, geotargeting has been so poorly understood and exploited that it isn’t much of an advantage for PPC.

Measurements

I don’t know any current web analytics tool that reveals the evolution of search for a purchase, in any useful way, out of the box. This “missing tool” means that people are focused on the “first click that leads to a sale”, and this betrays the complexity of marketing messages. As purchases become more complex, the number and type of different messages increases, and the communication method to get the right message to the right user becomes increasingly important. But even quite simple sales often involve several searches that lead to the same site, often in the same session - or I wouldn’t see this search evolution in single vendors web server logs.

Latency is also often ignored. Well, actually, I can’t cite any Web Analytics package that offers latency of conversion as a standard measurement, but I’ve only properly used four packages in the last year. Anyway, by adjusting advert copy, I know that I can control latency - how long it takes between a click and a purchase. That’s because the Advert Copy is selecting people closer to buying, or in an earlier phase. Latency is significant - for cash flow - but also because of what your site offers. Some sites support long latency sales better than others, so the right site may actually achieve overall higher profits by obtaining long latency clicks. Other sites will be focused only on supporting final phase processes and can’t properly support a long latency sale activity.

Summary

Paid Search and Organic have a somewhat false competition. The nature of the two is different, and complementary. Failing to consider either would be a strategic marketing error. The reason is that the tools attack different messages and opportunities in the Buying Process. Failing to use one or the other would be like not-using email - it addresses a different message in a different way.

The way that we, as an industry, think about problems is partially a consequence of what we think we can observe. There’s a lot of underexploited information out there, and a lot of stats that would be useful to marketeers, that we aren’t getting and probably aren’t asking for, from our web analytics vendors.

As well as “guiding” GAPs to provide Google recommended solutions, the exam questions also show a lot of subtle defects in understanding. Some of these would actually damage AdWords accounts if you believed and used them.

Passing the GAP therefore means that you have to answer not as you should do, but as you think Google would like you to answer. I’m deeply unhappy about this sort of test, and I have some reasons, and some career qualifications, to comment. For several years I worked as an academic, part of whose duties included setting questions, marking the answers and sitting on Exam boards for University degree examinations at the premier distance teaching organisation, the Open University. I still remember quite a bit about the difficulties of writing a good Computer Marked Assignment (a CMA, back in the 80’s). For example, what problems would cause a question to be zero weighted - and the acute embarrassment of offering questions that were weak and needed to be zero-weighted, if they managed to sneak through the review process.

As an ex-educator, I’m deeply unhappy about company sponsored tests. In general, it is a bit uncomfortable to take company specific tests - because there is no third party normalisation, known in UK academic circles as “moderation”, to make sure that the test is fair, rather than an inculcation to the inner brotherhood or sisterhood. I’d be happier if the test questions were adjudicated by a panel of *non-Google staff* search marketers. Google can propose at least some of the questions and answers, but the panel would control whether the question was permitted, and the weight of the answer. In particular, if I was an advertiser, I’d like to know that someone working on my behalf was not a covert extension of Google - delivering only Google approved answers, that might not be in my best interests.

Anyway, after I completed the most recent exam, I wrote a twenty-something page report to Google, with screen shots of dubious questions and a commentary on each of the them. I’ve given Google almost six months to reply to the detailed objections that I raised. They have not given any specific responses to my carefully documented examples - one email that said “thanks, I’ve passed it on”. In line with the spirit of Information Security analysts, it is time to publish the errors. Google has had time to fix the problems. If they are sufficiently discourteous to fail to respond properly, that’s their problem :)

If Google consequently want to withdraw the GAP that I have, to punish me for exposing bad questions and incorrect answers, I’m happy. At the moment, I think the GAP is not a good indication of expertise. It is an indication of brainwashing and the ability to answer the way that Google wants you to answer. It is not a qualification that endorses someone to manage a client account to maximum advantage *for the client*, neither is it proof that you know how the current version of AdWords works.

I’ll not reveal all the problems, all at once - it’d make this article at least twenty dense pages long :)

I’m also suppressing the entire question and answer, where I can, in order to avoid hand holding people through the current exam. The graphic typically illustrates the question, but may instead illustrate a set of bad answers - like the first example, below.

Since it is about six months since I took the exam, Google may have improved it. But I do recall some of the questions from the first time that I took the exam, and some of those re-appear here. Google seems to revise the exam much too slowly to be a useful indicator of competence - even for your own confidence of your skills.

The count of questions with dubious answers is important. The sheer volume of awkward questions means that in order to pass the Google-set threshold, you probably have answer at least some of these the way that Google wants - or you have to score perfectly on all the other questions. I’m pretty sure then, that most GAPs have either compromised what they know, or don’t know enough to be let loose :)

A Technical Error

The following image illustrates a radio box, which had four items. The candidate is supposed to select one answer out of the four offered. None of the selections had a label, as you can see from the two answers snipped below.

The fourth option asks you to infer which is answer b and which is answer c. There is no option b or c labelled in the answers. This is just a petty trivial administrative issue, but if I was sitting on the Exam Board back at the University, we’d be considering zero-weighting the question… Why? It was an early question in the exam, increasing stress on the candidate, forcing them to make an inference that is not tangibly tied to performance as a search marketer. It is sloppy work by the examining body. Someone failing to work out which was “b” and “c’ might be a perfectly fine candidate, who was flustered by the pressure. I’d encountered a few problems before this question, but the sheer sloppiness of this answer made me realise that I wanted to record the experience.

Question With Multiple Answers

The following question is a problem, because the expected answer would have been correct a few years ago. However, the system has evolved, and now several answers are correct. Worse, there are new additional answers, provoked by these changes, that aren’t represented in the set of allowed responses.

The answers included two correct responses. However, when the question was originally written, only one of the answers was right. Since then, the system has become more complex, and I can think of at least three correct responses - one of which wasn’t shown at all. The answer that is true in 2007, but was not true in 2005 is:

Increasing your Maximum CPC may cause you to reach your daily budget more quickly causing your ads to stop appearing for the day.

This used not to be true - although many people falsely believed it was true. So it used to be a great distracting answer to separate out the clueless. However, Google introduced a new option in the “Edit Setting” page for campaigns, that offers accelerated spending - burn the budget as soon as possible. So, after that option was added, two answers became possibly correct. But the question was left with only permitting a single answer, when two can be correct.

Additionally, the Display URL also interacts with the Maximum CPC. For example, when affiliates are handling paid search for a business, the highest value advert will be used (subject to the account history). So the way to appear on a keyword, when a competing affiliate is present, is to bid (and pay) more. This means that there is a common case for a correct answer (lots of affiliates use AdWords), where a known “correct” answer, is not included in the list. This is damaging to the credibility of the test.

Finally, one of the distracting answers had a probable typo - “Your ad will not appear if our” should probably be “Your ad will not appear if your”. It makes more sense as a distracting answer that way.

Answer lists that don’t cover all the cases, and allow only a single answer when there may be multiple correct responses, are not a good question for determining the effectiveness of a paid search specialist. This question and the answers should be retired and replaced by one that works.

Any GAP selecting a single answer for this question, with its simple list of answers, is doing so to gain the points to pass, not demonstrating that they deeply understand AdWords. That’s just ethically and morally wrong.

Question With An Assumed Answer

The following question assumes that there is a single best strategy.

However, the maximum profit is achieved differently by different sizes of operation and the types of product being sold. Fast paced inventory, with frequent price changes, and search volumes measured in hundred thousand clicks per day, may need very different strategies from someone satisfied with a few tens of clicks per day, and a relatively stable business.

Also, none of the solutions offered the use of “categories” and “comparison” oriented advertising, which I might want to use. This would be influenced by the business’ web site content and ability to support those sorts of advert - and the conversion rate, because these visitors may be fairly early in the buying process.

It is just ignorance of the uses of AdWords that would lead to suggesting that a single answer satisfies all needs. I often use option E, or F - in other words, an option that wasn’t offered. :)

The language of the question is also a problem. Asking for “effective” throws an invisible ball into the air, for the candidate to catch. Why? Because the answer depends on spend and profit levels. If you were doing this for a large organisation, you might be able to justify the savings to pay for the effort, and you might find it effective to hire a new staff member to do complex things. But if a very small business, complex arrangements should be avoided to get the most efficient spending, despite some suboptimal compromises, to save management costs. It is not “efficient” to spend more than the campaign monthly budget to set up a complex offering - something simpler, easier to set up and manage may be more “effective”, for the right business.

This question could be re-used, with some re-wording. For example “Which of the following strategies would be best for…” and then explain the scenario. “What is the best strategy…” may result in the candidate identifying a solution that beats the ones offered, and so failing to choose any of the offered options, or choosing one that best matches their solution but is not preferred by Google.

In general, questions should be written so that the judgement exercised is on the task you are trying to measure, not the ability to infer what the question might mean. Unless you are trying to test comprehension skills, in which case there are better questions than this.

Summary… So far

Google needs to carefully review their questions and answers. Some of the questions are left over from previous versions of AdWords, and what were once correct and unambiguous answers are no longer correct, or no longer uniquely correct.

Some answers show a limited understanding of how to use AdWords, particularly how tactical usage of AdWords varies between different types of advertiser and the size of the business. Selecting the “right” answer may mean inferring or guessing the assumptions that Google used when they wrote the question.

For advertisers looking to hire a GAP: A GAP qualification is better than nothing - but not enough to assure a client that they are getting best practice from someone who is working in the clients’ best interests.

For AdWords users attempting to demonstrate their competence: I’d rather see you with a CIM (Chartered Institute of Marketing) or IDM (Institute of Direct Marketing) qualification. Knowledge of marketing communications (poorly tested in this exam) and the phases of the buying process (completely untested in the exam) are, IMO, very important. So is a good numerical and statistical background - only tangentially tested. I can teach the essential tools and techniques for a marketing-qualified individual in a day, though getting the subtlety out might require some mentoring or an advanced lesson of a few hours, later.

Only another couple of dozen defects in the exam, to come…

Google has completely lost track of their mission, and is busy destroying the value of AdWords. Last summer, Google said it would be rolling out search history targeting. This was supposed to improve performance. I was sceptical. I’m now more than sceptical. I’ve seen the consequences. Google has killed the golden goose.

Google’s personalised search results, and their belief that the immediate history of search is important, can be easily demonstrated. However, whether this contributes to improved search result performance, is another matter.

I suggest that you sign out of Google Accounts before you add the following searches to your personal search history. It’ll help avoid polluting your personal search results with random stuff. It’ll also mean that your personal history doesn’t interfere with the results of the test. These queries are similar to a series of searches that I conducted, when looking into various client problems.

• Brazilian Tax Credit
• US Vacation
• river rafting
• cheap holiday
• US vacation

Here’s the two screen shots for results for the two searches for “US Vacation” - same search, but different precursor searches:

I believe that 4 out of the top 6 adverts are less relevant to the searchers intent, as a result of using search query history.

Notice the top position placement for holidays in Brazil - something that I’m not asking about. If I were to click this advert, what would my interest level be? Is it as high as my interest in a vacation in the US, or as high as my interest in Brazilian tax credits? Nope. So what will be the impact on CTR? Downwards.

Note the advert about US tax related issues. Again, if I wanted these, wouldn’t I have searched for them? So what is the likelihood of a conversion resulting from the clicks for these adverts? Remember that I’m in the UK. The total population in the UK is 60M and the US citizens resident here and needing to file US tax returns accounts for about 100,000, last time I investigated (1996). Even if the US resident population in the UK had doubled, that advert shouldn’t get a tiny fraction of the clicks as an advert relevant to “US Vacations”.

The last three searches have all been about travel - river rafting, cheap holidays and US vacations. Three of the top four adverts have nothing to do with the current search, though two of them do have something to do with the travel related queries of the previous track of search queries. But only one advert addresses what I asked for.

Note the absence of tax credits and Brazilian related adverts - but the new presence of shopping sites. What is it about “cheap holiday” and “us vacation” that implies an interest in shopping sites rather than travel sites?

I can see where Google is headed with this, but I suspect that the mechanisms need to be more carefully adjusted. This observation certainly explains why I’ve been seeing different behaviour in some client accounts over the last few months.

Deeply Disturbing

What I think I’m seeing, as a result of these changes, is a reduced conversion rate, and a higher average cost per click.

I think that the examples above make it clear why keyword search performance has dipped recently, reducing average CTR, reducing conversion rates and making the behaviour closer to that for content match. This is not the precision marketing tool that I was using last year. This is a weaker, more expensive and less precise tool that brings in a wider range of less interested users.

Reduced Intent…

The appearance of cheap shopping sites, high in the results, after an immediate search history for travel, shows that even when a user is following a series of related searches, that paid search results are being diluted by irrelevant adverts. Searchers clicking on these adverts are in a different phase in their buying process - they’ve been thrown back to “Needs Awareness” or “Research” phases - much as in content match advertising.

… Higher Priced

Why would using the search history result in a higher average cost per click?

I believe that Google is using the auction system to find the highest paying adverts. This means that the bids matching direct intent are now competing with a larger pool of advertisers. It means that each of the non-intent adverts has a higher revenue potential for Google. It means that the intent-focused adverts are paying Google at a price that is a consequence of competition with irrelevant focus. This potentially raises Google revenues, at least in the short term.

A back of the envelope calculation suggests that this *MIGHT* result in a small increase in revenue for Google, until advertisers reduce their bids. I suggest that this is a short term benefit.

Look at the first query results, above. Note that there are two relevant adverts - separated by several other adverts. The price of the higher adverts *used* to be exposed to the bid of the second relevant advert. It is *now* exposed to the bid of the third, but irrelevant, advert - so the price has jumped up, because these additional adverts are allowed to compete.

Response

I’m disgusted.

Google’s success was built on delivering search results that matched user expectation. Once again, we see Google acting to enhance revenue, without any concern for advertisers. This time, however, they have screwed the pooch. Users see less relevant results, too. This is not a good idea, as it will decrease the value of the search results page *for users*, and that will inevitably weaken interest in using Google.

I think that Google’s current product managers must have lost their copies of “Blown To Bits”.

Basic lesson:

The value of the search results page is a consequence of relevance. The lower the relevance of the entire page, the lower the value to users and the greater the rise of search atheism.

By destroying the relevance of paid search, Google has reduced the value of almost every page of search results. This has to be the pivotal moment for Google’s search dominance.

The impact has been reported, already - though I’ve not seen anyone draw a connection between recent lower CTR’s reported by Wall Street Analysts, and the weakened matching system now in use. However, the signal is clearly there, for me at least.

Personally, I’m dropping bid values, adding more negative keywords (though I have no evidence, yet, that this will reduce my clients adverts from appearing on irrelevant searches), focusing on exact match and phrase match. If Google is going to show my clients adverts to searchers who have no direct interest in my clients’ services, then my response has to be to reduce the bids - because the number of clicks per conversion will increase. It is inevitable, when the search history is used so insensitively.

Summary

Google’s AdWords product managers have lost the plot.

AdWords is no longer a precision marketing tool, used to put relevant adverts in front of an interested audience. It is now a blunderbuss, blasting anyone near the aiming point with a random scattering of irrelevant adverts. I might as easily direct budgets to general display advertising and get somewhat similar results.

I’m telling my clients to reduce budgets on Google and increase budgets for Yahoo! and MSN. These other platforms have their own focusing problems, but Google has completely lost any rational idea of what a search results page should look like.

I’m disappointed. I thought that Google employed smart people. Obviously not. Googlers: find your aged and dog-eared copies of “Blown To Bits” and re-read the bits about Navigation and Search and the value of page content. Then try to explain how reducing relevance will have a long term beneficial effect on your own brand. You’ll fail.

Forget the hand waving arguments about the value of the search history. Look at the results pages. Look at the dropping CTR. I bet that you’ve even seen an overall reduced volume of clicks per page. You’ve turned a terrific marketing tool into an unfunny joke.

Congratulations - you have completed my conversion. I’ve gone from AdWords advocate to someone that would sooner see the project be killed, than continue like this.

Updates

I was so cross when I wrote this, that I forgot to mention the Nash Equilibrium. I suspect that this perversion of search is a consequence of Google’s Chief Economist, trying to get more revenue, when Google have done The Right Thing by reducing their greed on search results pages that shouldn’t have adverts on them (that comScore article, referenced above, is pretty good about this). The Nash Equilibrium says that intermediaries like Google can squeeze out a certain amount of money from advertisers and from publishers, before advertisers start squeaking and reducing their spend.

Anyway, I added a couple of paragraphs spelling out why adverts cost more now, and who I think is probably responsible for destroying Google’s value.

Doubtless Google have numbers that I don’t have. (Duh). I can only make rational observations on what I can see and infer. Give me some more evidence and I might change my mind.

2008-03-17 Two new articles, refining the ideas in here. A short article summarising Search History Permutation, and a longer article, working through the psychology, marketing and economics of Search History Permutation in AdWords.