Will Google unlock the full potential of a smarter AdWords?

Google AdWords, the Pay-Per-Click (PPC) program, has proven to be phenomenally successful in search engine marketing (SEM) domain.  The program delivers most of the Google’s revenue. The search leader has claimed, that this keyword based bidding mechanism has been generally delivering 7x returns to advertisers over the media cost. In well designed (and executed) campaigns, it is not uncommon to achieve 4x-6x returns.

 B2B: A different beast!

However, computing returns on Business-to-Business (B2B) marketing programs over PPC is not that straightforward. The reasons are not very far to seek. Obviously the decision cycles are longer, requiring more research and consultation. The magic pull of instant gratification is absent. Most marketers use SEM programs (for B2B segment) to provide an initial trigger, to kick off user awareness/education. The task of continuing the conversation goes downstream into the Sales process. 

This introduces newer variables that are not effectively under control of the PPC program. The resulting limitation drives marketers to search for alternate channels that promise better and continued engagement.

But a PPC program has a deeper potential for creating multi-touch engagement.  It is possible to seek out the prospects at the right time, and deliver better metrics than what is commonly realized. However, this will be possible only when the Pay-per-Click campaign’s segmenting and targeting capabilities are enhanced and tailored to B2B marketing needs.

Rising complexity with the six stage cycle...

First some background.  A B2B decision-making cycle is much longer from start to finish. Marketing gurus love to break this cycle down into six distinct phases: 

                                          (Click on the image to see a bigger version) 

(the points in the orange highlighted zone illustrate the areas to be covered. The items in the list are indicative, not exhaustive)

 This segmentation actually poses a significant targeting challenge in the PPC campaign design.  Note that as one advances through these stages, the search progresses from being quite generic at the beginning, to very specific at the final end. With usually very sketchy information available on user behavior, the marketer often employs, the “one-shoe-fits-all” approach for reaching out to the prospects, regardless of the stage they may be in.

Some PPC campaigns, either take a “minimalist” approach by bidding on a very tightly knit set of keywords, or spread themselves thin by attempting a large cornucopia of search phrases.  The first approach has the obvious shortcoming of missing out on potential opportunities. On the other hand, the comprehensive keywords strategy requires a fairly large inventory of search queries (spread across core, generic, branded, intermediate and long tail).   

Of the two approaches, latter is generally preferred, since it enables campaigns to service a wide range of user’s intent. However, this carpet-bombing burns a deep hole in the marketing budget, pushes the cost per lead (CPL) metrics through the roof, and takes some shine off of the PPC program.

Decision Cycle Mapping using big data

No one, barring the NSA and probably Facebook (and possibly some enterprise grade PPC platforms like DoubleClick, Adobe or Marine…), has as much data on users as Google. With a vast array of search queries used every second, and a large spectrum of user’s response caught in its net, it will not be a big challenge for Google to decode the intent of the users. 

The Search Giant should then be able to map the intent to the stage in the decision making cycle. In other words Google can make the AdWords smarter, such that given a search query, the system will be able to determine the likely stage of the decision cycle the searcher is likely to be in, and display the appropriate ad-creative inserted by the marketers for that specific stage! 

Google can go even a step further, and suggest the type of search terms should be employed (by enhancing the Keyword Suggestion tool with insights from the big data) for each of the individual stages in the decision cycle.  Once the advertiser has selected the right search queries, and inserted the most suitable creative, AdWords would do the rest. This will take most of the guesswork out of targeting for marketers.

One may argue, that this assumes that all B2B users follow very similar steps in the decision-making, and use highly analogous search terms, to locate the information. While variations abound naturally, given the massive data set, statistical methods would be able to discern the real patterns, and abstract out the real intent to a fairly high level of accuracy. This is the reason why Google can do this mapping efficiently, and, at a much higher level of confidence, than an individual marketers struggling with (relatively) limited set of keywords and spreadsheets for just one domain.

Why should Google take this on? 

 I can think of the following reasons

• Who knows search more? An enterprise knows more about their business than any outsider. However, Google knows more about the searching behavior and relationships between search queries and user’s intent, than anyone else, even the enterprise running the PPC program

• AdWords Targeting capabilities: Google is BIG on adding newer and sharper bundles of arrows in AdWords quiver. It recently rolled out several enhanced targeting features. These range from Geo-targeting (+SearchEngineWatch) to Geo Bid Multiplier for B2B (+SearchEngineLand) and post-conversion (even offline win) analytics using Google AdWords Conversion Import as an aid to packing more punch.  Decision Cycle Mapping will be a powerful and natural extension tailored for B2B.

• Making marketers successful. A Decision Cycle Mapping capability will help in improving performance metrics by reducing most of the guesswork. Rising performance metrics will draw more B2B advertisers (and attract higher budgets) to the PPC programs. Higher performance will stimulate more competition as well. Google will stand to gain as the beneficiary of increased bidding rivalry.

From Generic to Specific 

All purpose general search engine marketing platforms have done wonders, specially for retail and direct to customer businesses, with ease of management in bidding, tracking and rules based actions. The shorter purchase cycle allows better control over the entire process, and, enables marketers to tweak performance metrics with confidence. 

A system, that attempts to target individuals in a complex decision-making process, needs to be much more specific in order to reach the right person at the precise moment, with the message that resonates better.

 

Well I guess this too goes into my Marketing Bucket List! 

 

Emperor's New Clothes are turning translucent...somewhat!

Facebook released, their first ever, Global Transparency Report last week, bringing back the debate on privacy and government’s request for user data, front and center. Facebook’s effort, at shading (some) light on the issue of government demand for data, was received eagerly all around. 

The social networking giant followed in the footsteps of Google, Microsoft and Twitter in this regard. Some pundits are lamenting that the report did not go far enough in revealing the full extent of such requests.  Some felt outraged at the insatiable thirst of US Government for data…!

However, a quick look at statistics published by Facebook shows that the requests made by the authorities in US is, more or less, at the same level as those made by the other top 5 governments in the report.   

The data on population, internet user and Facebook users have been taken from Internet World Stats.   The number of requests and user account information is from Facebook's Global Government Request Report.

The percentages of the number of requests, when viewed in the backdrop of Facebook user base in these countries, show a remarkably close range (converging to an average of 0.0067%, or 67 request per 1,000,000 Facebook users)! It may be interesting to explore why this would be so.

The % data on the Y-axis represent the number of requests/number of Facebook users and number of user accounts/number of Facebook users

In Law we trust!

The tech giants have stressed repeatedly that they scrutinize such demands closely, and follow the law strictly. In some cases, they point out, that they take the issue to the appropriate court too. Google and Microsoft have banded together to fight for more transparency than that allowed under FISA.

Perhaps adverse user perception is one of the real issues here. The popular opinion received a sever setback due to recent revelations and secrecy surrounding the legal, executive and legislative oversight on the massive data dragnet. 

Due process is guaranteed by Rule of Law. Lifting the cloak of secrecy on the “due process”  itself is probably the key!

 

Taking search deep within the pyramid will open a new frontier

Search behavior in South East Asia and some underdeveloped regions of the world has a strong potential to expand. More and more people are getting mobile phones and hopping onto the carrier networks.  However, search in these regions, may not follow the same trajectory as in the situation where access to internet and smartphones is widespread.

Internet penetration generally grows at a much slower pace than the voice circuits, given infrastructure and resource constraints. 

 

Mobile phones have the deepest penetration, and in countries like India, are the most pervasive of all devices.  While smartphones are spreading like wildfire, their presence is more confined to urban centers or rural elites.  Some statistics place over 920 million total mobile connections, 44 million (5%) of which are smartphones with some sort of data connectivity. This leaves a large number of mobile phones with no access to search engines.

The language bottleneck is also a barrier to search when a large mass of population is not very proficient in the major internet languages. 

Search Engines have not been able to crack the language issue very well. Google has done some work where the search terms being keyed-in are translated into the selected language, and the results are displayed partially in the language selected.  The problem the search engines face is also due to lack of web assets in the  language of the query in their index.  This limits the quality of the results.

A moment reflection would show that this is really a chicken-and-egg situation. With almost no one to query, there is little incentive for anyone to put up a web property in the language of its users.

SMS based search

Traditional web search requires a browser running on desktops (or laptops or smart mobile phones).  The search index is queried via keywords entered into the search engine's browser interface.  The results are returned by the search engines, and are displayed in the standard fashion in the browser.

Search on mobile devices and smartphones follow a similar paradigm. One variation of this is voice-activated search on mobile devices (the famed SIRI) where both the query and the results are “spoken.”  However, voice agents are more geared towards “finding” rather than covering a broad canvas of “searching.”

The SMS functionality that all basic phones have can help solve this problem.  A user sends in his query via a text message to the search engine. The search engine responds by sending, say top 2-3 results customized for display on the small mobile screen.  The call-to-action (CTA) could be the ones appropriate for the device like - send a text message or place a call.  

Wait! This is not a new concept!

Google did launch a text based search interface. The service sms.google.com went live in 2004, and was shut down in May 2013! This service involved live agents who received the query, fished the results out, and sent those back to the phone. 

Few years ago another search engine ChaCha.com attempted something similar.  They had “guides” who received and responded to the user’s query via text messages. Last I know is that they are still active in US but have closed their shop in UK.

Then again three years ago a brave soul in India started Askbysms.com – a similar service. This also shut down soon after.

Why attempt something that Google, ChaCha and others could not succed? I believe the answer lies in targeting.  The search providers thought that SMS based searching would be a cool alternative to their audience who have internet connectivity via desktop or smartphones.  They did not have in mind the large swath of population for whom this could very well be the only way of searching. 

Airtel, the largest mobile service prvoder in India has SMS Gyan, a text based search service that is still running. However, a user has to pay Rs 1 for every query. 

The most promising start in this field appears to be from a young enterpernure who lauched Innoz. It will be interesting to see how this evolves.

Note that the search use case here does not involve complex queries. The person is probably interested in finding quick information about some local service to consume in his area – repair/price/availability of food/some commodity and like. Unlike browser based local search which is accompanied by maps and reviews, the SMS based results can have limited address and say distance from a known landmark in the vicinity as a navigational aid.

Cost & Revenue?

There are two very apparent snags in this approach.  A user has to pay every time a text is sent. In contrast a desktop and mobile user pays nothing for searching (discounting the payment to ISP or mobile carrier for the data plan that is spread over a host of activities other than search....streaming videos, email...).  So paying for search via texting would appear to be an extra fee on the user.   

However this is not an insurmountable issue. The search engines could set the system up with carriers, that the they, the SEs, rather than the searcher, pay for the query by the user.  Alternatively using their (considerable) clout they can negotiate a very very small price to the user.

Is that absurd? Studies have shown that it costs carriers next to nothing  to transmit a text message. These 160 character messages do not taken any space in the valuable wireless spectrum.  Search Engines, given the weight they can throw, would be able to work out a far more favorable price for themselves, much lower than say $0.10/ Rs. 10 per text.

Still absurd? Hardly so! 

Ad Revenue?

Now let us examine the questions of monetizing search via sponsored ads. Search is free because the search engines make money  in advertising.  In SMS based query the search results can be formatted inventively, so that first 120 chars are reserved for displaying the top 2 search results, leaving some room (40 chars) for showing the one ad that wins in the real time auction. If the user chooses to scroll for more results (say the next 2), the second ad could show up. 

Will 40 chars be enough? Google AdWords desktop search ads take 25+35+35 = 95 characters plus display URL.  In our case display URL is not needed because there is no web browser (or internet) to navigate to. A user should be able to connect to the sponsoring party via text or a call.

How about language?

 

Mobile phone manufacturers in India have introduced local language keyboards that are quite intuitive. Users do easily send or receive texts in their own language. 

When user start searching in their language, the local businesses/organizations will start hosting web assets in their language. The higher search volume will bring in advertisers as well.  When people who are the lower rungs of income pyramid start searching, the business segment that serves them will follow suit.

Today there is little evidence that the small businesses are motivated enough to get into search engines index. There is a strong perception that advertising on Google is expensive and unaffordable for street corner shop.  Makes sense as small businesses go where their customers congregate. A SMS based search will draw in users in large numbers, so even with relatively lower per capita advertising revenue, the total yield will not be insignificant. 

Why go to this length?

  The alternative is to wait till Internet infrastructure expands and people shift over to smartphones to avail of the existing search process.  The latest report shows that between April to June 2013, smartphones took 51.8% share of the total phones sold. The flip side of this report is that 209 Million basic phones were still sold throughout the world. There is (and will be) a large mass of population that will continue to use feature phones for a long time to come.

People obtain information either by searching or by asking. The basic phone users usually resort to the latter, since they do not have access to the former.

Several studies have shown that search creates economic benefits for users. Taking search down to the most common denominator will be equitable and will create a win-win situation for everyone, besides narrowing the digital divide.

 

Snag that Seat: My Digital Marketing Bucket List-2

Last week Google released its Q2 earning report. The search giant made a handsome $14.11B, pushing its earning by 19%. Yet the results also revealed a continuing softening in the cost-per-click metrics that is at the core of its revenue (more about the report here).

AdWords is a wonderful uber tool that is of enormous help to businesses in acquiring, targeting and converting prospects. Its success comes from the fact that the ads appear when the searcher's intent is very high. The platform gives controls, dials and knobs if you will, that a marketers needs to tweak and develop a predictive marketing model. 

It is also very generic!

The tool itself is agnostic to the industry/vertical/domain. It does not care whether the person wielding the knife is targeting businesses, or wish to reach directly to consumers.  That  flexibility in targeting are left to the advertisers.

While this model has worked well, it also throws up challenges for small businesses including mom-and-pop shops. The flat auction based model does require significant budgets and a healthy dose of perseverance to attain attractive ROI.

A custom AdWords model for SMB?

How about an auction platform specifically tailored for small businesses/around-the-block diners/massasuse/spa services, who would love to get more business when they need it, and in the manner they want it?

Let me explain this a bit more. An owner of a small restaurant should be able to participate in the bidding process, to get patrons at the time when the business is likely to be slow, and should be able to control the volume!  

You would argue that Groupon was banking exactly on this need when they launched their “daily coupon deals” using social networking effect. However, as noted, they went astray and focused on getting users that demanded almost bank-breaking discounts from the business owners. The incremental traffic was  usually a short lived spike, which never converted into stream of loyal returning visitors.

A business should be able to select time-windows when they know that business will be slack, the additional numbers they are looking they are looking, the deal they are offering and the value they put on the table. 

Such an offer will essentially be time sensitive and would capture the essence of “now”. 

It is not very hard to see that this can tie in very nicely with voice based search agents (aka Siri). Imagine you are driving through a new locality and ask your voice assistance to search for the top 3 restaurants in the area offering Chateaubriand at a great price.  Siri can respond back with the names of the joints, number of seats still available and their deals, and can book a seat at the place that also throws in your favorite dessert!

 

Firmly in control!

 

Such a platform will put the small business owner firmly in control of the marketing budget,  the deals they can afford (with the ability to tie the deal with time-of-the-day, day-of-the-week…..you get the picture!) and restrict the numbers they want. Additionally, they will not be competing against other out of town bidders who are not part of the locality. 

And since search volumes are rising on smartphones, promise of a robust ROI will bring in healthy competition and move the needle on the CPC metric.

Fantasy? Not really! All the bits and pieces, that that need to go into, already exist. Everything that was described above is well within the realm of possibility.

Just last week,  Quartz reported an article, euphemistically titled, High Frequency Dining. Now hungry hackers  in San Fran are writing bots to grab the favorite seats in restaurants!  I am not suggesting that eating joints should follow the much deride practice by some airlines to price the middle seat differently. But the news points out that it is very well possible to count and bid for seats algorithmically.

My Digital Marketing Bucket List-1

Americans are ok with it. Europeans have strong trepidation about it.  No it is not about stimulus package or the massive global, invasive surveillance program.

It is literally about the “cookies fight” or online profiling to enable finely targeted ads… 

You agree to barter your personal information and browsing behavior for free access to content and well-timed ads. While we, on this side of the pond, accept the implicit blurring of lines between being a “consumer” and a “product”, our brethren, on the other side, balk at the idea. And they have tightened the cover of “cookies jar” (pardon the pun!).

This message prompts you when you visit any website in UK or European Union!

 

Massive amount of data and profile patterns have become life-sustaining nourishment for the digital marketers.  And it is Google, Facebook  and Yahoo that have, undoubtedly, the biggest heaps of  “big data”.

Of the three, Google has the most advanced advertising platform. Its AdWords program let marketers determine the search queries and build the ads that deliver the best performance.  However, the ads, once created, are shown to every individual performing search on those queries, regardless of the demographic profile or the search intent.  You can, of course, set up separate campaigns for each geography, or resort to day parting. But if you are running a large campaign, such slicing very soon becomes major and expensive headache.

Targeting can go deep(er)

Since Google has amassed petabytes (soon to become exabyte or even zettabyte) of data on individuals, it would be relatively easy for them to develop fairly accurate profiles (demographic including information like occupation, station in life and so on) of its users.  Now, if an avid AdWords marketer has the ability to develop multiple ad-creatives and target to the desired user profiles, it should not be too difficult for the search giant to match and present the most relevant ads.   

It is easy to see that such ads will attract relatively more clicks (pushing up the click-thru-rates or the CTR). And if the marketer is savvy enough to direct users to well designed landing pages, the Quality Score of the campaign can go up, reducing the cost of acquiring traffic and increasing the satisfaction all around.

To be fair Facebook has demographic targeting but you will need to set up multiple campaigns if you want the message to be differentiated.  Google's display network does offer some flexibility in targeting, but everyone knows that their search campaign delivers better results. Bing sports age and gender targeting, but as Search Engine Land reported,  decided to remove the exclusivity citing “inaccuracy” in data and lack of volume!

 

It is apparent that digital marketing technology is moving from generic to specific…very specific!

Maybe it is just a question of time.

Search Engines still a Frontier?

 

Flurry of “activities” related to search engines and website optimization drew me  to the digital marketing world.  The current hot flavor (actually has always been) is digging out the factors that Google (supposedly) takes into account in order to rank websites higher in the SERP.  

Mining activities range from the task of compiling 200 factors based on what SEO pundits have been talking about  (more importantly what is coming from Google’s Spam Master +Matt Cutts) to running yearlong correlation experiments on a large scale (I wrote about deconstructing the ranking factors last week in my other blog post) . 

Then there is an elegant “Periodic Table” compiled by +Danny Sullivan (from Search Engine Land) that groups and lays out these factors. 

                                                   (See the bigger version at SearchEngine Land)

The idea of second guessing Google is not very attractive (and may not be very productive as well).  It is obvious from the constant series of algo updates from the search giant, that it  is  maintains the integrity of the Page Rank  jealously, and is thwarting all attempts to outfox its search results.

There is one aspect that deserves some thought though. Google has always been consistent in its advice that the website owners should stick to creating quality content that is useful to users, unique and engaging. The attempts cited above should be better aimed at finding factors (and parameters) that help the website content and usability measure up against that goal. 

It may be more useful to gauge the visitor's view of your website than to focus on outsmarting searchbot's clinical perspective.

Playing with just mechanics results in a constantly moving goalpost.