A blog on using the power of Disruptive Business Models to build successful businesses...and other stuff. by Joe Agliozzo

Wednesday, November 30, 2005

Google "Beginning of the Backlash?"

John Battelle and Fred Wilson both post today on the beginnings of a percieved backlash against Google.

The timing of these types of opinions coming forth and the new AdWords Terms of Service are interesting, and my previous post regarding the new "no 3rd party apps" terms of service generated a lot of comments both here and at the BetterPPC Blog. Many, many small companies have been working on applications for AdWords that use the API since it was released in January and now are worried that the effort will be for naught.

Is Google going to be the next Microsoft, a giant predatory that wants anything and everything for itself and exacts a toll on all connected with it?

Or do they intend the more modern (and moderate) approach of encouraging many 3rd party apps to flourish around the search engine and ad platform (and gmail and maps and base and ...). Seems like this would be a more "enlightened" and also more profitable long term approach.

As a follow up to this story, the "AdWords Evangelist", Google Employee Patrick Chanezon has posted a response (warning: not very enlightening). Meanwhile the "Commercial API" appears slated for release on January 1, 2006.

Seems ironic now, but we are actually now eagerly awaiting the release of MSN AdCenter and revamping of Yahoo SEM! - let the market forces begin!

Sunday, November 20, 2005

Google's New API Terms of Service - A "Google Economy" or Not?

I spent quite a few hours this weekend reviewing the new Google AdWords API terms of service. All I can say is "wow". As pointed out on the Google AdWords API Developers forum, Google either Google wants to prohibit virtually EVERYONE from using the API (and if so, then why bother developing and releasing it in the first place?) or they have the world's worst lawyers.

When you read the agreement, the gist of it is basically this:

AdWords advertisers can't use any applications that use the API that have been developed for them by third parties. Advertisers can only use those that are developed for them in house or "custom" built for them. If your app can be sold to more than one customer or is hosted and made available for more than one customer, apparently that is against the TOS.

(See Section II, paragraph 2 - "2) Non-Compliant AdWords API Clients. You shall not use an AdWords API Client that violates this AdWords API Agreement. For example, you may not use your Developer Token with an AdWords API Client developed or hosted by a Third Party (excluding an Internal-Use Only AdWords API Client developed for you)."

That's it. End of story.

Another important part of the backstory on this is that Google has a "My Client Center" Account structure. The MCC is like a master account and the API calls are made through the MCC account, via the MCC Developer token for each account. The cited language above now prohibits this. The problem with putting all customers in the software provider's MCC account is that it then limits the client to using only that provider's software. Currently many advertisers use different software for different functions and this will be impossible under the new terms and conditions.

I found this hard to believe so I called Google and asked if, for instance, AtlasOnePoint would no longer be available to advertisers, and was told no, absolutely not, and that there was no special deal for them or anyone else. The intent of Google is not to prohibit these types of services. The rep I spoke with said someone from the API team would get back to me (but no one has as of yet).

Other issues for a later post include the fact that Google is going to require extensive Google branding on any app that uses the API, security measures for the data extracted, prohibitions against sharing the data and a paragraph previewing service charges for access to the API. This is especially hard to believe since presumably, any service that uses the API, in order to be commercially viable, would have to help advertisers be better/more efficient at what they do, which would presumably result in more revenue to Google, so why would Google charge for that and by doing so, discourage use of the API. Surely, Google, with all the billions of dollars in the bank, can't be worried about the expense of supporting an API, can they?

We'll see.

Blog Spam

Wow, I guess Google really needs to do some work on blog spam. Nice examples of it in all the comments to my entries.

Monday, August 29, 2005

Pay 4X Per Click or Optimize Your Ad Copy

That's right, over the last few weeks, Google has implemented a minimum (that's right minimum) bid per click policy for AdWords (and AdSense as well).

Now if Google's algorithms determine that the ad you are running on a particular keyword is not generating enough revenue for Google, you have two choices:

1. Agree to a proposed minimum bid (which I have personally seen to be 4X or more the amount of the recent average CPC for keyword/ad combo).


2. Change (optimize) your ad copy.

Yes, that's right, you have the opportunity to avoid a potential 4X increase in your CPC cost if you create the right optimal ad.

It will be interesting to see if even Google (the 800lb Gorilla of all Gorillas) can make this stick, especially with MSN Search launching in a few months.

Thursday, August 04, 2005

More Detail on Longer AdWords Test

Google is apparently going to start allowing testing of text ads of up to 200 words in length in the next few weeks. The headline and display URL formats will remain the same. Google will alternate the new format ads automatically with the original ads and compare them to see which ad performs better. CPC charges will be the same, and during the test period, the longer format ads will not be used for calculating Quality Scores during the test period. More info at Search Engine Journal (including link to original report).

Big Changes coming to Search Engine Marketing

Some big changes that were long rumored being reported this week:

1. Google is testing longer format text ads

2. AskJeeves will sell ads directly to advertisers, rather than being solely a syndicator for Google.

3. MSN is in late stage testing on their own version of AdWords.

These changes are great for advertisers. There will be more opportunities to find the best messaging with longer text ads on Google; more chances to precisely target your ads by buying direct on AskJeeves if that works for you, and obviously more opportunities to do the same on MSN by buying directly from MSN. The fact that MSN is going to mimic Google's auction system also probably means a more competitive market for keywords as well.

Great summary at Search Engine Journal

Tuesday, July 19, 2005

Small Etailers can make it on their own!

Great article by David Kesmodel in the WSJ (subscription).

For those of you without subscription access, the article talks about the increasing number of online retailers who are looking for alternatives to eBay. Many are going out and building (or having others build) their own website. As we all know, websites and shopping carts have dropped dramatically in price and complexity over the last few years and are now accessible to virtually anyone who wants to open an online storefront.

The big problem with severing ties to eBay is getting traffic. One customer mentioned in the article, OldDogNoNewTrick.com (love the name), puts business cards in with every product sold through eBay referring the customer to the stand-alone site! Great idea.

You can probably make more money outside eBay IF you get your visitors cheaply enough (it is all about customer acquistion cost, after all!).

Search engines are probably the most cost effective way to get new customers, and that's where BetterPPC comes in.

In addition to making sure your site is easy for the search engines to "crawl" - meaning use a lot of plain text, not images, and always have a "site map" - meaning a directory of your site on one page where each section is noted by a hyperlink that the spider can crawl, you also want to take advantage of pay per click advertising on the search engine (and partners') pages as well.

You need to do three things to get up and running after you setup an account:

1. Choose keywords that relate to your products.
2. Decide how much you want to pay per click.
3. Write your ad copy

After a week or so, you should have a good idea of whether your advertising is profitable. The easiest way is to just compare ad costs to profits and make sure it is a positive number! Another easy way to track profitability is to use either Google or Yahoo!'s built in free tracking.

The next step is to start to refine your ad copy by creating and testing more ads, and the results will be amazing. Use BetterPPC to test a variety of different ideas in your copy, and our patent pending process will have you on your way to higher profits in one week. You can start here - www.betterppc.com

So if you are trying to "break away" from eBay (or at least open a new sales channel), read David's article, get your own website, start advertising, and use BetterPPC!

Joe Agliozzo

Sunday, July 17, 2005

New Google AdWords Policy Emphasizes Creative

Like most of you, we received the Google email on Friday that discussed the changes in the Keyword Evaluation policy. In addition to going back to the simple, active/disabled nomenclature (rather than in trial, etc.), the email discusses Google's continuing policy of really stressing the relevance (and quality) of the AD COPY. That's right, the same problem/issue that we created BetterPPC to solve!

The importance of testing to find the most relevant copy:

1. You have a new chance to show ads on previously disabled keywords. In the past, we've found that if a customer account contained keywords that had previously been disabled, often Google would not permit ANY new ads to run on these keywords. In conversations with customer service at Google, we would often complain about this and ask how customers could ever find relevant ads if Google would not even allow any new ads to run! Apparently Google heard our complaints (and similar compaints from many others) and now they are allowing customers "another chance". Of course, we urge you to make the most of this chance by using BetterPPC, which will give you the BEST chance of finding that relevant "magic" ad that will keep your campaign alive and profitable.

2. NO MINIMUM BID. This is huge. It has always been an advantage to find the most relevant ad (the one with the highest CTR) because Google will show a more relevant ad with a lower Max CPC over a less relevant ad with a higher Max CPC. The reason is the famous G profit= CTR x CPC. If you remember basic algebra, a higher CTR or CPC means a higher "G profit". Now Google has taken this one step further and ELIMINATED the minimum bid. Now if your ad is high performing on CTR (meaning relevant) you can avoid even a $.1o minimum bid. Talk about crushing your competition! If you test for the most relevant ad copy (with BetterPPC hopefully), and find an optimal ad, you can lower your max CPC even more!

We will also be discussing this change at Search Engine Strategies, San Jose, on our panel "Creating Compelling Ads". See us at the panel or at our Booth in the exhibit hall. We will be doing live optimizations on site at no charge, so come by our booth and bring your Google AdWords username and password!

Obviously we are excited about these developments, because they highlight the importance of testing and finding the best ad creatives - so get cracking and give BetterPPC a try today.

Joe Agliozzo

Here's a link to another great article discussing the change - Search Engine Watch

Friday, June 24, 2005

Trade Show Exhibiting

The first trade show for BetterPPC was a great success. We met a LOT of great people and received great feedback on the BetterPPC service. Many advertisers we talked with knew that they could get better results by testing their ad copy, but the difficulty and tediousness of doing that kind of testing was holding them back. Seeing a test platform like BetterPPC, including the analytical test design/analysis program we provide, they instantly saw the value of testing. We were also located next to the Google booth, staffed by Google AdWords support folks, and they immediately saw the value in what we were doing and wished a tool like that was available to them when they are assisting AdWords customers. Of course, we told them we would love to make that happen - are you listening Google?

We are exhibiting at AdTech: Chicago next and will be unveiling a completely new User interface (using some cutting edge AJAX to help the customer navigate the system), along with an enterprise version of our product geared to agencies with multiple clients.

A couple of other things I learned about tradeshow exhibiting:

1. You can never have too many extension cords.
2. “Collateral” is important. As an attendee, I always feel like it is a waste and doesn’t get read, and as an exhibitor I wanted to skip it and do live optimizations for customers. But this wasn’t practical, you just have trouble getting (or often giving) that much time to people. Visitors come in waves and your booth (and everyone else’s) is either “slammed” or empty - very little in between. People expect to get something to take with them and you have to provide it.
3. If you can possibly squeeze it into your 10x10 booth, it is great to have a place to sit with visitors because you can really focus on them, and you also get a BREAK from being on your feet 9 hours a day, which is tough. This way you are still working and giving off the right impression, but you also get to take a rest!

Tuesday, May 31, 2005

Cross Posting

Most of my new posting related to AdCopy optimization will now be over at the Betterppc website.


I will continue to post here on other issues.

Thursday, April 07, 2005

Authority Improves Performance

We always stress in our presentations at events like Search Engine Strategies the importance of conveying reliability, trust and quality in advertising. Our analysis has shown that these concepts can have a huge effect on ad performance, lifting CTR's as much as 20-30% if used properly.

An excellent article by Todd Mintz in Search Engine Guide makes the same point - Give Your PPC Ad “Authority” and your CTR will skyrocket.

Thursday, March 03, 2005

Vertical Search

New Report from Jupiter Research on the opportunities in Vertical Search. "Vertical Search" means search devoted to specific categories or industries, such as Travel or Retail. The opportunities for advertisers are interesting here because currently, CPC prices are low. HOWEVER, make sure that you are using your tracking software religiously because nobody knows yet whether or not these clicks will convert.

Fred Wilson (A VC) also has a brief hit on this, and quotes Danny Sullivan.

Tuesday, February 22, 2005

Re-Launch of BetterPPC Product

We have now completely re-architected the BetterPPC application to take advantage of the release of the new Google AdWords API. The change in the performance of our application is incredible and the user experience will be MUCH better.

We are also readying the launch of two Free services. An automated "Ad Generator" that uses AI to create test ads, and a program that looks at existing ad campaign data (no testing required) and selects the optimum match of ads and keywords. The performance of this program will obviously not be as good as testing, but it will be a quick and easy way to get the "instant gratification" of improving your campaign, and will introduce our customers to some of the amazing power of our test and analysis product.

Behavioral Targeting Company Nabs Amazon Chief Scientist

Many believe as we do that the future of advertising lies in testing and data analysis. Poindexter Systems just hired away Amazon's chief scientist, Dr. Andreas Weigend. His expertise in testing and data analysis is probably one of the main reasons why Amazon is almost universally cited as being the best designed e-commerce site in the world. Amazon arrived at the design of their application through thousands of tests and analysis of user behavior.

I love this quote by Dr. Weigend: "Having an agile way of doing testing will affect where the market is going."

As a company dedicated to improving ad performance through testing ad copy, we agree.