sesny2008

Words die out and new words emerge. It’s the concept of neologism. Then there’s that text language that no one understands. More acronyms like kpc, fyeo, gal, etc. (A cookie for you if you know what those three mean.)

The Basics: Listen to and participate in the social media ecosystems to learn about them.

Principles of Effective Social Media Engagement:

• Listen first
• Participate after
• Make friends with community elders
• Understand and respect community mores
• Lead with altruism; come bearing gifts
• Discover a community need
• Learn the linguistics
• Value and cultivate the relationships
• Leverage appropriately, and over time.

Rob talks about Sony and how they created a fake blog and it blew up in their face. Don’t create fake blogs. Hire me! Huzzah!

Best in class companies are 4.2 times more likely than laggards to improve their year over year customer retention rates.

There are two kinds of content: Content above the waterline and content below the waterline. What is the conversation below the waterline? Buzz monitoring is conversation mining. You can scour the discussion areas to capture, understand, and report the products, issues, and opinions that consumers share between and among themselves. They can come up with ideas and concepts and companies can now listen in and engage. This includes newsgroups, blogs, podcasts, and social media sites.

[Cries. Slow down!]

Voices and Venues
Influence: Who are the most frequent and visible voices in the brand? What are they talking about and what is their sentiment?

Trending over time provides the greatest insights.

What topics are emerging and which are becoming less popular? How are perceptions of new voices? What is your reputation within SERPs for your most popular terms? What is your visibility within the search engine results for the most important issues?

Create topic associations. Identify new language.

A communication strategy that enables companies to proactively and ethically engage in the proliferating consumer generated media universe to inform, educate, influence and engage.

Posted by Lisa Barone on 03/19/08 at 2:15 PM | Comments (0)

Afternoon Keynote: Jason Calacanis

Take a deep breathe. You know this is going to be good. Jason Calacanis is giving the afternoon keynote at SES NY, which is an SEO conference. Do I even need to say anything? I’m just hoping no one gets shot. Or if they do, they don’t bleed on me.

[Jason just walked by and said I have to be nice to him in my recap. Why do people always ask me to be nice? Am I really that mean? I have such an innocent face.]

Kevin introduces Jason and asks everyone to keep it PG. Heh.

Jason starts by clearing the air. A few years ago he was here for SES San Jose talking about Weblogs Inc and someone asked him if he did SEO. He said they didn’t; they build sites and make good content and it ranks well. He says he called search engine optimization bullshit and then everyone in the audience gasped. That’s when he realized there was an SEO industry (hee). He thinks what’s changed is the definition of what is SEO, it’s becoming clearer.

Search engine optimization used to mean gaming your way to the top of the engines, because that’s what you heard from the cold callers. Since his fatal comment, Jason has gotten a big education about what search engine optimization really is from people like Bruce Clay (holla!), Michael Gray and Neil Patel. He knows SEO is about making sites that help people and having a good structure. That’s when Jason learned the difference between search engine optimization and blackhat SEO. He thinks blackhat SEO is BS and a waste of time. He likes building long term value. He thinks the whitehat SEO is really important. In some ways, he is an SEO. He’s a whitehat SEO. If SEO is defined as building a site that helps people, that’s what he is.

Hear that? Jason Calacanis is an SEO.

Mahalo was launched on May 30, 2007. The first question he got was, “isn’t this just DMOZ?” It does look a lot like Yahoo and DMOZ; it has that directory-like feel. Yahoo and DMOZ failed. You have to ask yourself: why did it fail? Why doesn’t it exist anymore? Yahoo Directory failed because they sold it out. DMOZ failed because it was neglected by its owner. But they were both amazing in their own time.

How is Mahalo going to Scale?

It will scale with a distributed work force. In June, they launched the Mahalo Greenhouse to let people work from home to create search results. They have 400 people doing it from home currently. It’s the largest distributed work force on the planet behind Wikipedia and (probably) About.com. They’re at 40,000 pages right now. It can scale. In theory, it shouldn’t. In theory, Wikipedia shouldn’t work, but it does.

How are you going to keep it up to date?

Having seen Delicious and StumbleUpon use site owners and people with a vested interest, he knows people will tell them when they make a mistake. That’s why they launched Mahalo Social, which is basically like Delicious. It dramatically lowers his cost of keeping the pages updated. They’re building a trust world.

The engines created the SEO industry so they didn’t have to talk to site owners. If you have a problem, talk to them. The SEOs are the intermediary. The Mahalo discussion boards are kind of the same thing. It allows people to have a discussion in a public forum about something they don’t like.

Jason talks about the Mahalo Toolbar/Mahalo Share and how it helps SMOs. He stumbles trying to figure out what SMO stands for and it’s actually kind of cute. See, Jason’s really not a jerk. He’s just like us, getting confused by oddball industry acronyms!

Where is all this going?

How we (re)search today:

We use machines, experts, our friends and the wisdom of crowds. He’s shows the audience how he’s using the social graph to connect users and information. That’s the future of search. It’s not just machines or the wisdom of the crowds. It’s all of those things plus the social graph. It’s creating semantic relationships between people and objects. The objects are the SERPs. They define states between people and objects. What is the state between you and a book? You could have read it, are wanting to read it, are reading it now. The new PageRrank is knowing if you can trust people through their behaviors. If you can, then you can let them contribute more to your site.

The new MyMahalo will make social graph features more prominent on the Mahalo search results. Page will show pictures of friends that have shown an interest in a specific topic. Reviews will be imported directly onto the page (with user permission). It’s giving users the chance to leverage all of their data into one spot.

One More Thing:

Not everyone wants to give up Google or Yahoo. If you’re doing a search on Google and you have the Mahalo toolbar, they’ll syndicate out some of their content so you can see it in your Google result. They don’t want you to give up your experience on Google.

Question & Answer

Can you define what you think an SEO does?

Jason: My perception has changed radically. The SEOs I’ve met are outsiders in the technology industry. You have this elite group (Digg, Yahoo, Microsoft) and then you have your SEOs and site owners. He’s found that the SEO folks are some of the smartest hustlers, get it done kind of people. (He means hustler in a good sense of the word.) Like Jay-Z (hee!). His mom was a nurse and his dad was a bartender (Jason’s, not Jay-Z’s). He worked his way up. He thinks SEOs are just like that. A lot of them are stuck in short term think. They want to make some money today, but they may be spinning their wheels a little bit. By the time you get a page ranked and you make 10K off affiliate links in a weekend, you basically expended all this energy and you maybe could have built the next Engadget. He thinks maybe they’re more into the gaming then they are of creating something of quality. SEOs are really intelligent people. The blackhats are polluting the Web and that makes it bad for all of us. Then consumers don’t trust the Internet.

Kevin: My experience with the blackhats is different. I tend to try not to piss them off. There’s an element there of let's think a little bit more altruistically. You gotta take it in order to get it, but maybe we could contribute a little bit more.

Jason: Just because you can take the number one spot doesn’t mean you should do it or that it’s right.

You tend to ask for forgiveness rather than permission and I was caught by an example where the Mahalo listings were supplanting paid listings (via the Mahalo Toolbar).

Jason: When the Web page reaches the person’s desktop, it's theirs to do what they please with. If people want to put up ad blockers, that’s their right to do it. If people want to put Mahalo on their page, I’m okay with that. If Google says they have a problem with that, we’ll change it. He doesn’t have a problem with people remixing in the privacy of their own home. He doesn’t think Google will complain.

Is this your model now: The more people get upset at you, the more links you get to your site?

Jason: Are we talking about linkbaiting? What is that?

Kevin: You say something obnoxious and 500 people link to you and it’s basically just a small group of people who are big fans of themselves. (Kevin, 1; Linkbaiters, 0)

Jason: You can only take linkbaiting so far. I like to have a good time but even I know when to call it a day. I don’t want to be at war with the search engine optimization industry. He’s more than willing to evolve the discussions. You can link bait a couple of times until people figure out you’re just schmuck. You get the reputation you deserve over time. You just need to be authentic and real. Don’t make linkbaiting your strategy. He’s turned it on his head. He’s made it affection-baiting. You have to say nice things about him in order to get him to link to them. People should be nice to people.

If you were an online marketer, how would you promote your content?

Jason: The best way to market is to have a great product. Make products that speak for themselves. Then you have to authentically insert yourself into conversations. If you want to engage someone, you write a comment on their blog about something that has nothing to do with you. If people add Jason on Twitter, he tries to go to their site, checks it out and then sends that person a message. Products without human beings behind them will never do as well as companies without them. People don’t want products with no personality behind them. Make yourself available.

Is there a risk for being overexposed?

Jason says he’s the first to admit that he’s overexposed. He has his cell phone number on his presentation slides. A stalker showed up last week at the office.

Kevin says yeah, keep leaving your cell number on your slides. Hee!

What about the long tail? Most searches have never been seen before. What about that?

Jason doesn’t believe that one solution is going to solve the search problem. He thinks it’s going to be a blend of techniques. If you’re looking for the pizza place around the corner or the girl you staked in college, Google is the way to go. But if you’re looking for info on Paris, that’s where human editing comes in handy. Sometimes you need a hybrid and there are those too. The person who will win big and create the next Google is the person who finds out how to blend these different disciples to create a single product. Users do not care how pages are built. They just care if the result is good.

[Jason breaks into a strong NY accent that is…well, it’s horrible considering he’s actually from NY. It’s like movie gangster.]

How do you categorize the traffic relationship you have with the other search sites?

Jason thinks that there are going to be a series of services that are dependant on search engines and some portion of them will be able to convert that traffic into direct traffic. Right now they get a majority of their traffic for search engines. Mahalo is a content company. They’re like Wikipedia or About.com. If they do good original content and they rank us, great. If not, we’re in it for the long term.

Can you explain why you chose not to implement canonical redirect?

He wanted to have URLs that you could type mahalo.com/keyboard. It’s easier for people to remember. It’s a personal preference.

Posted by Lisa Barone on 03/19/08 at 1:09 PM | Comments (1)

Top Search Trends

Hey, hey, happy people. Lunch is over and it’s time to learn about the Top Search Trends. Speaking we have Heather Dougherty (Hitwise), Jeremy Crane (Compete) and Roger Barnette (SearchIgnite). I had a brownie for lunch. It tasted like rainbows and sunshine.

Kevin is making jokes about the SES box lunches and no one is laughing. It’s awkward. He’s dying up there. I giggle at his expense. Affectionately, of course. Who doesn’t love Kevin Ryan?

[20 minutes later: Speaking of lunch – Did anyone have the tuna salad and is now suddenly feeling sick? I’m not trying to cause an epidemic, just asking. I’m not feeling so hot.]

Heather Dougherty is up first.

She works for HitWise and all of their data has been collected by studying 10 million Internet users. That’s a lot.

Google and Yahoo continue to capture the majority of the share of searches – 88 percent combined. Together the four top engines account for 98 percent of the search market share. There hasn’t been much shift compared to last year. Interesting is that time spent on Google has also increased. I noticed from the chart that Ask.com users spend the second most time on site, beating out Yahoo and Microsoft.

How many people are returning to the sites over a 30 day period? Almost 94 percent of Google users return. It’s about 89 percent for Yahoo, 77-79 percent in MSN and mid 70s for Ask.

Besides reach, there needs to be a way to differentiate the search engines by specific objective. They use Mosaic to get segmentation. From there, they compare how the segments translate into the audience of the search engine.

Heather whips out a chart that shows that the majority of Ask.com users are, in fact, female. Which means that if Barry Diller really is turning Ask into a “search engine for married woman” that they would be going after their core market. Whatever. I hate him.

The ubiquity of search behavior drives frequent return visits, creating creatures of habit.

Shopping and Entertainment categories currently benefit most from search traffic, but there is little reliance on specific categories to drive referrals. Using segmentations based upon behavior can help differentiate between the search engines beyond reach.

Jeremy Crane is up to talk about the state of search.

Seven out of ten Web search queries performed in the US are on Google. Ask is the only other engine with year-over-year market share gains.

What about that second click through?

Yahoo searches result in a search referral to another Web site more often than the other major engines. Ask searches are the least likely to result in a referral.

Average search fulfillment: 65 percent for Google, 75 percent Yahoo, 61 percent MSN and 12 percent Ask. Ouch, Ask.

Percentages of Web search queries that result in a referral to another page in the search property domain:

Google – 11 percent
Yahoo – 17 percent
MSN – 5 percent
Ask – 29 percent

The slow death of the 10 blue links: We’re seeing this evolution of the search results page, what it looks like and how people interact with it.

Ask 3D made the biggest impact with blended search. The rollout of blended search has yet to have a major impact on the top 3 engines but the story is different for Ask. The amount of people clicking off an Ask results page plummeted. Shows Ask keeping people in their own domain.

Ask is all about the ladies, or is it?

Among major search engine properties, Ask has the highest concentration of women and Family Oriented users – 55 percent (I love that Google has 51 percent, yet Ask’s bar is about twice the size. Way to not scale things to make them more dramatic.).

Kevin asks the panelists if it’s smart for Ask to target women. Kevin says he’s found that it’s not wise to tell women to do anything. Heh. Heather chimes in that not all women are alike.

Last but not least is Roger Barnette.

Marketer Trends

Marketers are spending more money in paid search in Q1. Same advertiser media spend is up 43 percent. Paid clicks are up 47.2 percent.

Search engine market share is basically flat and has been over the past year with slight gains for Yahoo.

User Trends

On the user side, impressions are up dramatically. Advertisers’ ads are being seen substantially more than they were a year ago. Google is up 60 percent year over year.

Cause for concern: Click through rates declined 18 percent in Q1 and conversion rates have also dropped.

User Engagement: Users are getting smarter and searching. The average number of clicks it takes to lead to a client transaction has gone down 1.43 percent. The average keyword length has declined 6.8 percent to 15.46 percent.

Industry Trends

• Flight to quality in uncertain economic times.
• Beginning of momentum towards blending of search and display campaigns
• Auction media platforms beginning to move beyond paid search in earnest.
• Marketing demand for better cross-channel marketing attribution measurement.

Okay, that was a whole lot of stats.

Posted by Lisa Barone on 03/19/08 at 11:20 AM | Comments (0)

Ad Testing: Research & Findings

[I’m feeling a bit out of sync in this session at the moment. I’m seated way on the right instead of front and center like I’m used to. It was a strategic decision on my part. With six sessions happening today and only 15 minutes between some, I need to conserve battery power. The power outlets are on the right. I’m smarter than I look, people.]

Jumping right in, we have Andrew Goodman (Page Zero Media), Bill Barnes (Enquiro Search Solutions) and Anton Konikoff (Acronym Media) speaking.

Up first is Anton Konikoff. He’s mesmerizing in a Dracula kind of way. I can’t take my eyes off of him. Anton mentions that Mike Grehan is now part of their crew. I got that memo.

Why Engage In Ad Testing?

• Get quantifiable insight in a controlled environment. The right ad testing methods allow you to get true insights that allow you to make well-informed judgments.
• Helps you understand messaging effectiveness.
• Identify the most attractive product offerings
• Create the optimal search campaign that maximize ROI/ROAS
• Identify learnings that can be applied across other media channels.

Fundamentals:
The Scientific Approach: You isolate your variable. Only test one thing at a time. Keep bids/ad serving equal and run a control group. Doing this helps you get meaningful results, assuming you limit the number of ads being served and collect a large enough sample size.

Reality Check: There is the theory of ad testing and then there’s how it works in the real world. If something doesn’t work, you hurt your Google Quality Score, your competition ends up running ahead and you have a limited budget. Not all messages work with all keywords. In theory, you should be testing everything. In reality, we don’t have time for that.

You have to test smarter. With a smart approach under real world conditions, we can make educated inferences. Start by testing either Titles or Descriptions. Depending on your ad budget, test 2-5 ad versions. Use significantly different messages/offers, using themes. If you’re testing in Google, turn ad serving to “rotate” (not Optimize) for more-even distribution.

Running The Test:

While testing, manage bids normally. Don’t run it as a “test”. You’re interested in real-world performance. Once you have enough data, start looking for trends among groups of similar keywords. Make sure you’re focusing on the most important metric – the highest CTR and highest conversion rate may come from different ads.

Anton gives us a quick case study from the Four Seasons. They have 72 properties around the world. They decided to test three different types of ads. The first ad they ran focused on the brand, the second focused on the price point and the third was informational. They purpose was to get a better understanding of user response across different geographical regions. The same ads and keywords were tested by continental regions.

Findings: Each continent they tested had a unique conversion results for ad copy. In Europe, the brand theme worked best. In Asia, it was the price points and in North America, it was the informational.

Round Two: They selected the top performing ad and started testing the next element of the ad. If you texted descriptions first, test titles next. Pause all of your old ads and start fresh to reset the Quality Score.

Common Pitfalls

• High CTR may not be good! Ask if you’re qualifying your traffic enough. Is your ad misleading?
• Are you getting enough clicks to make accurate judgments?
• Do all versions work as well with your landing pages? How do different ads affect Bounce Rates?

Next Steps…

By now you’ve got a fairly good picture of what works. That’s no reason to get complacent. Start looking at other components like punctuation, display URLs, proper case vs sentence case, accent usage, dynamic keyword insertion, dayparting, banner & email creative, and engines beyond Google.

His motto is test, test, test, then invest. Heh.

Next up is Bill Barnes.

Search is the connection between Intent and Content. What is the person thinking when they sit down at a computer and launch a search? If you can match their intent with your content, you win.

With Search, intent is key. You want to get inside your customer’s mind. This includes doing research and creating personas. Make your research human, not academic.

Bill shows us how a user interacts with search results pages. There’s a little yellow blob floating around the screen. I’m having Ghostwriter flashbacks. [sings: GhostwritER!] He talks about the Golden Triangle and I zone out for a minute.

How Intent Impacts Searching:

Scenario 1: Bill has a brother-in-law. He doesn’t like him but he has to buy him a birthday present to keep family bliss. He knows he likes John Irving. His brother in law lives out of town and Bill plans to spend $20-25 on him. He’s going to have the gift shipped so he doesn’t have to see him. Bill doesn’t like his brother in law. He says that about 8 more times.

He looks for a John Irving title. He scans the page until he finds a scent that matches his intent.

Scenario 2: Same purchase but he’s searching for himself, not his brother in law who he doesn’t like. He’s looking for reviews. Again, he scans to match his intent scent.

Scenario 3: Your friends came back from Vegas, now you’re planning a trip and you’re looking for the cheapest rate at the Bellagio. You find the scent that matches your intent – lowest price guaranteed.

Scenario 4: Your friends just got back from the Bellagio and now you’re going to Vegas. Your friends raved about it but you don’t trust them. You do your own search looking for information on Vegas hotels.

Intent should impact scanning behavior.

For Research type queries (the second version of each example), we would tend to “think slice” sponsored content out of the way.

For Purchase type queries, we would tend to focus more on sponsored content. This should mean an increased tendency to skip over top sponsored content.

They did a test to see how people responded to the Bellagio examples. Both Researchers and Purchases focused on the same listings. The scannings were almost identical. 80 percent of the people scanned the first few words of the title on 3-4 of the first listings. They both paid a lot of attention to the first result.

Interestingly, the results proved that purchasers spent 3x longer on the results page -- 23 seconds on average. Researchers spent a greater percentage of time in the sponsored listings than the purchasers did. However, 100 percent of the clicks were in the organic listings.

This means researchers are looking at Sponsored Listings but are not finding what they want. If you know researchers are looking for your site, start tweaking that ad copy to target them. Don’t try and sell, inform.

An experiment with personalized results:

They asked search marketers what search was going to do and where it was going in 2010. They talked a lot about Universal Search and personalization. To prove that personalized search would work in 2010, they put together a study. They took a group of subjects and followed them around watching the kind of search activity they would perform – what sites did they go to, did they go to social sites, did they watch video, etc. After they got their results, they mocked up a page with personalized elements. They took positions 3-5 and planted personalized results in there. The personalized results drew the eye a lot more than they were expecting. He thinks this is proof that personalized search will work. The percentage of fixation time doubled on personalized results and they got 3x the amount of clicks.

You don’t have to wait for the results to be personalized. When you have your personas built, you can write copy that will specifically appeal to them. Really drill into your personas.

Semantic Mapping In Search

He told people to search for “digital camera”. They asked people what they were thinking the moment before they searched. Got lots of brand names, some people were looking for reviews, features etc. Even though they’re thinking about different stuff, they still all typed in the same query. They noticed how they moved down the page and which words they fixated on. They found that most people focused on the semantically mapped terms—the stuff that was dancing around in their head. Know what your customers are thinking about and put those words in your ad copy.

Brand Testing:

Brand fixations occurred in the URL and title of the listing; not in the description. Place your brand in the title, URL and as close to the start of the description as possible in your sponsored and organic listing. Subjects with established affinity for the brand spent 25 percent less time on the Top Sponsored listings, jumping down to the organic listings 73 percent faster than the non-affinity group. Sponsored listings appear to have a greater opportunity to lift brand affinity among new customers. Write content to them, not existing customers.

Summary

• Understand intent
• Get inside your customer's mind
• Understand the importance of the area of greatest promise and the consideration set
• Determine whether you’re targeting a researcher or a purchaser
• Test personalized ad copy
• Don’t base understanding on just queries
• Test brand messaging
• Personas

Last up is Andrew Goodman. He says he’s going to ask us a lot of questions. [pleasedon'tlookatmepleasedon'tlookatme]

Quiz!

Q: Should you test ads towards ROI or CTR?
A: ROI

Q: Headline: Dynamic Keyword Insertion or not?
A: It works very different with short and long keyword lists. Obviously you should test. Isn’t often great for CTR, not so great for ROI. It can be the best option to begin – until you refine and find something superior for long term ROI.

Q: Headline: Clever or Plain?
A: Plain.

Q: Call to Action in Ad: Yes or No?
A: You should always test multiple offers and calls to action – especially at the refinement stage. On its own, who knows? But with a lot of testing, the “ultimate” ad will often include one. Check it out: Our brand can be a call-to-action and allow you to leave that in the display URL. Or reinforce it by putting it in the headline and in the display URL without having to use up body characters.

Q: Use Punctuation: Yes or No?
A: Totally typical of something that is context-sensitive and requires testing. B2B buyers might like it. Conversely, B2B buyers might be equally amendable to retail psychology or eye tricks. User's eyes pick up on subtle things. All of a sudden, a “buy now!” call to action seems too salesy to some. You need to reintroduce new tests periodically.

Q: Display URL: Keyword in Subdirectory or Not?
A: Tends to win. They’re eye-grabbing. Additional relevancy cue for users. Seems “navigational”.

Q: The display URL looks like a destination URL or no?
A: He’s seen it work. Why? User confidence? User persona: Slightly gullible, likes “real” search, hates “ads” but in reality they're not really that picky.

Conclusion: Don’t listen to his opinion. Data can be complex. He doesn’t know your business model and not all parts of the account behave like other parts.

Stage 1: Rapid Discovery

Look for Hot buttons: Be motivated by “skinny persona research”. Ask who. Consider what drives them. Try certain incentives, offers and calls to action. Price, shipping, style, a persona, or business crisis.

On very granular campaigns, be considering what you can or can’t extrapolate to other ad groups: Headlines, styles, calls to actions, benefits, shipping offers, testimonials, etc.

Stage 1A: Beware of Statistical Noise and Context Sensitive Tests

Stage 1B: Statistical relevant of tests by ad position

Stage 2: Multivariate Testing

After you’ve done your initial quick improvements, you have to go into formal MT testing.

Tight Targeting Bias in a Quality Score World

Best practices account-wide will “half write the ads for you”.
Keywords, Ads, Landing Pages connection: Poor relevancy, loose targeting will make testing beside the point.

High CTR Bias in Paid Search

Going granular is part of the battle. But what about broader parts of the account? You don’t always know the intent. Valuable prospects with different intent can be typing the same terms.

Posted by Lisa Barone on 03/19/08 at 9:39 AM | Comments (0)

Morning Keynote: Gordon McLeod

I have coffee. There’s a keynote. Let’s go.

Kevin Ryan is up and says we’re in the homestretch here. There are only two days left of drinking. Um, he means sessions. Two more days of sessions. Who drinks at conferences? Stop looking at me.

Stop it!

Okay, Gordon is up. Thank goodness.

Gordon says last year they rechristened themselves as The Wall Street Journal Digital Network. There’s a lot going on there. You have Financial News, FiLife, MarketWatch, Barron’s Online, and the Wall Street Journal verticals.

WSJ Timeline

1996: He shows what the WSJ site looked like in 1996. It was, um, pretty sad. It was articles from the paper cut and pasted onto the site. There were 50,000 subscribers. Search was not part of the nomenclature. There were four firewalls around the site (hardcore!). You had to pay or else. Their biggest problem right now is that they’ve been around since 1996, meaning that their site platform is really old. The pay walls are not very successful. They’re catching up.

1997-2002: Vertical sites are spun out, but search still isn’t part of the conversation. They started offering up some free content. They have 600k paid subscribers. Put some content outside the wall and drive more inventory for ad sales.

2003-2006: They start getting pretty serious about search. People are starting to talk about search. They’re talking to the search engines. Search engine optimization becomes important. They acquire MarketWatch and Barron’s Online is launched as standalone site. WSJ also launches free content like blogs, podcasts and their mobile edition. They have 800k paid subscribers. They start to understand that they needed more content outside the firewall.

2007: That was their big year. SEO basics like dynamic site maps, modified URL structure, proper redirects, and consulting expertise are brought into the mix. They were rewriting headlines to do better in search.

AllThingsD.com is a free tech site build on WordPress. They launched the Barrons.com “free at 3” program where content that was for-pay on Saturday was let free after 3pm on Monday. MarketWatch Community: Increases the surface area and generates high quality click backs.

Still in 2007, Personal finance and “Business of Life” offered as free content, they offered up a snippet page with two paragraphs free, and one click access from Google and Digg. They’re up to 900k paid subscribers. Trying to grow both the content and ad network at the same time.

And it’s working. Search engine traffic is up. They’re being served up more in the search engines. Last year they weren’t found at all, says Gordon. Referral traffic from search engines has more than doubled since October 2006. Share of search engine traffic has grown 33 percent.

2008 and Beyond

There are no excuses if you’re not being really aggressive about search. The WSJ never had never really focused on it until last year.

They’re going to expand their free content offerings. There's talk about making the WSJ completely free. He says it’s not quite playing out that way. Their traffic is growing faster than their capacity to sell ads. They’re going to stick with the hybrid model of having both free and paid content.

They’ve almost doubled their political coverage. Increasing international coverage, food and wine, sports, etc. They grew 68 percent uniques last year. They’re pacing ahead of that for 2008. It’s because they’re smarter about servicing content.

Another big change for them is they’ve adopted a site search. They used to offer Web search but it was a lousy user experience. They’re spending a lot of time thinking about site search now.

They’ve added blended search features into their own site to build the user experience. They’re started it on MarketWatch.

The Hybrid Results Page

This is where the WSJ is going. Gordon says CNN is doing a decent job combining Web search with site search and serving it in a way that’s pretty user friendly. Gordon says he likes what CNN is doing and wants the WSJ to model that. They know they don’t have the best story on every subject and they want to point you to the places that do.

CNN puts Google in the search box. They’re debating whether or not they want to do that. They’re talking to the obvious partners. They want users to use their search box. They don’t want users to leave their site, whether they want to search the site or the Web.

Search as a content platform

Gordon says users only use site search when they fail. When you run into a brick wall, that’s when you go there. They want to use search as the key platform to learn about user, extending it as their primary platform for all content access. Behavioral search will be used to create a unique user experience around content.

Lessons Learned

Web site is a 1.0 Concept: Three years ago the paper would hold stories from the site so it would be in the paper first. There are still a lot of companies that do that. The WSJ is beyond that but they’re still learning that it’s okay for their content to appear in other places, like Yahoo Finance or Facebook. They’re using it to reach new audiences.

SEO is Not A Project: In 2002, they’d hire SEO consultants who would do an audit and then they’d go away. They do training and then they’d go away. They’re now working with a company and are in a one year contract. They have training programs set up. SEO is a way of life. It’s not a one time project. [Emphasis added.]

Free is Good: He’s happy with their free content. He wants to grow the free content out and the paid content. The Journal publishes 1,000 pieces of news a day. That gets him excited.

Build and Buy: Do you hire an SEO staff or outsource it? Do you build your community platform or have someone else do it for you? He says build and buy.

Content is back. He wants to be high up in a Google/Yahoo/Ask search and he thinks the search engines want that too. It’s been up to the WSJ to catch up. They’re hiring writers and have changed the way they process content. You’re talking about a world that would produce content and then say, "okay, if you’re interested come read it." They’re far more aggressive and open about that now. They get up every morning thinking about the index and where their content is. This catching up isn’t showing tremendous growth. We’re not going fast enough to pay for this content, but we think we’re going in the right direction.

Posted by Lisa Barone on 03/19/08 at 9:08 AM | Comments (0)

March 18, 2008

Landing Page Testing & Tuning

We’ve hit the final stretch of Day 2 with the Landing Page Testing & Tuning session. This one features an introduction by Sage Lewis (SageRock.com) with Tim Ash (Site Tuners) presenting. Now seems like an appropriate time to comment that I am freezing. The toes are doing that turning blue thing again.

Sage is suddenly doing an infomercial for Tim’s book. Oh good. I thought the sponsored sessions were over for the day?

Tim said he’s going to try to keep us awake because he’s the only thing standing between us and free drinks in the expo hall. There are free drinks in the expo hall? I…um…fine. I’ll stay here.

Tim lets us know we’re going to turn into WIIFM – What’s In It For Me?

What is Landing Page Optimization? It covers a lot of things.

Online Marketing Activities

• Acquisition: Get people to your site
• Conversion: Persuade them to take desire action
• Retention: Increase lifetime value of relationships

Why should you care about landing page optimization? Because you have neglected your landing pages and/or your conversion rate is too low. This is costing you a lot of money. The economics of conversion says fix your site to lower costs.

[mathalert] Your CPA equals your CPC over your clickthrough rate [/mathalert]

Tim asks the audience what a camel is. Apparently, it’s a horse designed by a committee. Clever.

Next questions: Who should design your Web site? Ad agency? Your boss? Webmaster? Marketing? IT (no, no, no, keep them in the cage, says Tim. Hee)? The answer is none of the above. Your visitors should design your Web site.

[Tim is giving out $20 bills to people who answer questions correctly. I’m waiting for him to ask a question about puppies. Or how to drive Susan Esparza crazy. I’m good at those.]

The Matrix

It’s a systematic way to make sure people’s needs are being meet. It’s getting the right people through the right activities in the right order.

Matrix = Roles x Tasks x AISA

Roles: The identified visitor roles of those interacting with the mission critical parts of your site (Faculty, Staff, Alumni, Parents & Families, etc)
Tasks: Specific activities that a visitor in a particular role wants to engage in.
AIDA: Awareness, Interest, Desire, Action. The stages everyone has to go through before they’re going to do what you want them to do.

Common Awareness Problems aka What Not To Do:

• Banner Ads: There are more important things you want users doing on your site, don’t distract them.
• Entry pop-ups: You can emphasize and deemphasize things on the page.
• Clutter home pages: He shows an example of a home page with 146 links on the page. He says even someone with ADD would get bored looking at that page. Don’t do that.

Keys to Creating Awareness

• Stop screaming at your visitors: (flashing banners, pop ups) Tim just screamed really loud and scared me. Sad face.
• Eliminate choices.
• Unclutter what remains.

Rules of Web Awareness

• If you can’t find something easily it doesn’t exist
• If you emphasize too many items, they all lose importance
• Any delay increases frustration

The rules of Web interest are to understand what I am and understand what it is I’m trying to do. The rules of Web desire are like dating. Users want you to make them feel appreciated, make me feel safe and understand that they are in control.

The Action Step

Why should I get it from you? Brand strength, previous resource investment, the total solution, and risk reduces & credibility.

You don’t have control over your brand strength or your resource investment but you do control the total solution, stuff like customers service, return policies, etc.

The risk reducers and credibility are things that make customers feel “less bad and more better”. (I apologize for that grammar.) You want to make sure your trust and credibility symbols are visible above the fold. Get them out of your footer.

The rules of Web action are: Get out of my way, make it easy and don’t surprise me.

Picking a Tuning Method

Key considerations: What’s the size of your tests and do you want to consider variable interactions? Interactions are very important. Maximize positive interactions (synergies) and eliminate negative interactions. It’s not the headline or the photo on the page that matters; it’s the interaction they create together.

Don’t ignore variable interactions. Interactions exist and can be very strong. Ignoring them will lead to sub-optimal results. A/B splits and MT tests assume that there are no interactions

AB Split Tests: Test one variable at a time. Send equal traffic to all versions. Very simple to implement. You get 1-10 recipes.

Multivariate Testing: Test several variables at the same time. Ignore variable interactions and try to predict best setting for each variable. You get 1-100 different versions.

Non-parametric tuning: Proprietary math for Internet marketing. Designed for large-scale tests. Takes variable interacts into account. Get millions of versions of your page.

Avoiding The Pitfalls

1. Ignore Your Baseline: Always devote some bandwidth to your current version. Measure relative to the baseline, not absolute performance. You test a change that increases your CR from 4.6 percent to 5.03 percent, should you get a promotion? No, because things have actually gotten worse relative to the baseline.
2. Not Collecting Enough Data: Do not make decisions based on too little data. Pick a confidence level and wait to see which version is better.

Posted by Lisa Barone on 03/18/08 at 3:23 PM | Comments (0)

Orion Panel: Universal Search

Did you have a good lunch? I had a granola bar. No, I’m not bitter about it.

Time for another Orion Panel. This time the subject is Universal Search. Speakers John Battelle (Federated Media), James Lamberti (comScore), Lyndsay Menzies (bigmouthmedia), and Jack Menzel (Google) will debate the issue with Kevin Ryan and Mike Grehan moderating. I should also mention that we’re all sitting at round lunch tables. It’s kind of ridiculous.

Kevin asks for feedback on the lunch and gets none. Heh. I’d say something but I haven’t yet had an SES box lunch. I’m sure they are delicious. And don’t at all taste like cardboard.

Kevin says “universal search” is the generic term, but that’s a dirty lie. Blended search is the generic term. Universal Search is a Google term. I promise to stop ranting now. Until someone says something dumb.

Lyndsay introduces herself and says she’s the token female. I giggled. Kevin wants to clarify that at no point did he say the words “token female”. SES is hilarious.

James gets us started. At comScore they’re tracking everything on the page and that’s the information they’re leveraging to report on Universal Search. He says you can divide Google Search queries into two buckets: Queries that contain a universal result and queries with no universal result. Universal results are queries that include video news, images, blogs, etc.

According to James, of 1.2 billion queries conducted on Google, 220 million contained a blended search result. Eighty-seven million people searched, and 58 percent saw some sort of blended search result. Universal search is dominated right now by video and news, and then secondary by Images. Fifteen percent of results had more than one type of Universal result presented.

Google is being very targeted with what they show. It’s not like Ask.com where it’s a fuller multimedia experience. Google is remaining fairly siloed with what they’re doing. James says a lot of people get emotional here, but we train the consumer to search in a specific way and adapt. The fact that the engines are wading in the blended search waters carefully shows that they’re protecting them.

Two takeaways from the comScore data:

• Organic search will be increasing critical
• Search result pages becoming the destination
• Technology and content super cede marketing spend.
• Internet “view thru” value will challenge measurement.
• Paid search will become more competitive
• Fewer paid click options on fewer pages
• Consumer in control, not marketers
• Conversion rates should increase

Consumers are the priority, not the marketers. Blended search prevents marketers with a new challenge and gives consumers what they want. As marketers, we need to take advantage of the content and make sure that the inventory of video, images, etc, is set up to be captured by the engines. His inclination is that if you as a content creator come up with a better result than what’s found on YouTube, Google will present it.

Mike: 212 million queries are blended search queries. Is that indicative of what we’re seeing elsewhere?

James says he doesn’t know yet. They’re still in the process of figuring that out. Jack says he doesn’t have any stats on that either.

Mike says it’s safe to say that it’s not necessarily people following the lead of Google. There are other engines where you see them working in these blended type results, as well. You’re putting your data together. At the end of the day, the end user is the Holy Grail. If you have great data, they’ll use it.

John starts some trouble asking if Universal Search isn’t killing Google’s core model. He says there was a beautiful alignment between the Google model and ten blue links. This is breaking it completely. Is that a factor?

Jack says it’s not breaking it. The idea behind blended search is to be as relevant as possible and Universal Search lets them do it. He would argue against that it’s breaking the ten blue links idea. Jack says they talk to consumers and 80 percent say they are aware of what’s paid and what’s not. They said they understand the idea of the top rail/left rail. [I don’t buy that for a second – Lisa]

John says fine, but universal search is a different interface. You’re not making any money with maps and stock quotes. How do you make money with universal?

Jack says they’re seeing a segmentation of the query stream. A lot of universal-type queries wouldn’t bring up monetized results anyway. Google is trying to innovate with different ad formats. He says he doesn’t know all the details. It’s not accurate to say that Universal Search is not compatible with their ads model.

Kevin mentions some recent comScore data that was badly misinterpreted to claim that Google was getting less clicks. He says we have a situation where it looks like the click rates are going down because we have fewer ads, so there are fewer ads to click on. How are the engines going to make money?

Jack says that there was a follow up to that report that said it wasn’t nearly as bad as initially reported. He doesn’t have any evidence that Universal Search is less monetizable. They’re trying to keep an eye on the number of clicks but they don’t want to be terribly disruptive.

James says there was no reissue of the comScore data. What we’re seeing is half the equation. The other half of the equation is that things are more relevant and each of those links (ads) that a user does click on should be more valuable. We don’t know the conversion rates.

Mike says we can now do better than ten blue links, that we should have a richer end user experience. He watches people surf now. They’re on Facebook, social media, sites, etc. This is a really rich user experience. Then you go to Google and you get ten blue links? Who wants that? As for monetizing it, he’s looked and seen that many PPC results have some Universal-type features. He talks about that Google Bourne Supremacy link.

Lyndsay says the biggest problem brands have is that there’s a lack of control for them. For a big brand, to even have video or images released, it’s problematic. They’re being more concerned with how their brand is being portrayed online. This will give users better results but there are still teething problems.

James agrees that it’s an organization challenge. Lynsday says there’s a fear around it. She had a client release a viral video and it was received really badly. They spent so much time making that and trying to get it into the universal results and it flopped. There’s a fear of that happening.

Kevin asks if it’s easier now to optimize a piece of video and get traffic against it?

Lyndsay says it is. Brands know it’s not just about ROI anymore; it’s also about building the brand.

Kevin: Lets’ talk about the “view thru” as a success metric. To me, that’s a little like a soap opera. You can miss 5 years of episodes and jump back in and the same people are still sleeping together. [OMG. What?]

James: Just because we measure search as a direct response vehicle doesn’t mean that’s the only value it provides. We’re already past that. He spends 50-70 percent of his time talking to brands about the value of “view thru” impact on search. Consumer behavior elements are just way too valuable.

Lyndsay agrees with that but says there’s still a massive shift to get to that point.

John says there’s a lot more to be done with US. There are models we haven’t come up with yet.

John’s harping on his old question and says that Google has to have some hesitation of giving too many Universal Results that sacrifice advertising.

Jack says that yes, there is a certain segment of the queries where you can just answer the question. But at its core, the Google SERP is still about getting people to the information that they want. Most queries can’t be answered with a little image or a preview. To be realistic, they’re going to be diverting traffic and driving it.

Mike says conventional wisdom in SEO terms is all about writing a great Title tag. In the research that he did for his new book, he spent a lot of time looking at Shakira. (oh, here we go…) Every time he did a search, up came images of Shakira half naked. He doesn’t care about Title tags when there’s a naked woman on his screen. [Kevin says, great, now we all know you like to click on naked women. Hee.]

John says we lived in a text driven world. It’s easily processed by machines. When you have images and video, you’re changing the game in a really big way. Both in how you monetize and how the industry monetizes and how consumers behave.

Jack says they’re not surfacing YouTube all the time. The reason YouTube shows up the most is because most of the videos on the Internet are on YouTube. In everything we’ve done, we don’t believe we’re changing this ad model. If people search for Shakira, it’s likely people are looking for naked images. [Mike Grehan agrees. And we laugh. Kevin says Mike searches with the Safe Search off. And we all laugh again.]

Mike says way back in the day, millions of pages were being uploaded and they were static HTML pages and that was it. In web 2.0, now million of videos and images are being uploaded and they’re competing with those static pages.

Kevin says most of the YouTube video is crap. It's men setting their own testicles on fire. It’s Mike searching for Shakira naked. What’s the shelf life? John says this morning he was at an Ad Age event and on the panel was Damon Waynes and he has a new partnership with YouTube. He was guaranteed by YouTube to get 6 million views from the home page for his videos. Does that mean he’s going to automatically end up on the Google home page?

Jack tries to say he has no knowledge but John basically cuts him off. He worries about how that’s going to get in the search stream.

John and Jack are getting heated. John wants to know why Google Finance comes up first when people search for stocks. He’s basically attacking Jack here. I feel bad. Someone needs to give John a puppy and level him out.

Jack says they try not to promote themselves any more than what they think is fair. They try to be true to the “we will present the top results for that query”. They’re trying to rank only the most relevant stuff. There is nothing in the algorithm that is biased to Google properties.

John lets out a big sigh. Kevin fears he’s having a heart attack.

John says Google is becoming a media company and they should just own up to that. They have these media properties – Finance, Video, Local – and yet you have this vision of the brand that is indifferent on where to go next. He doesn’t think the brand can sustain that without conflict. He thinks Universal Search is in the heart of that conflict.

Kevin is happy we’re finally back on the topic of Universal Search. Yey!

Mike mentions that Google always said they wouldn’t be a portal site and that’s what they’re turning into. Google needs to admit that they’re a destination site.

Jack agrees but says that’s just them trying to get them the information as soon as possible. It’s not their fault they just happen to own said information and can therefore place it right on the results page.

Kevin ends things by making everyone give Jack a round of applause. Poor Jack. He deserves it.

Posted by Lisa Barone on 03/18/08 at 2:12 PM | Comments (1)

Why Local Is Different

Time to talk local, people! Ian White (Urban Mapping) is moderating this morning’s session with speakers Gib Olander (Localeze), Benu Aggarwal (Milestone Internet Marketing), Chat Schott (Marchex, Inc.) and Vik Advani (UpNext.com).

First up is Chat Schott. He’s from Marchex. He works with Matt McGee. I’m secretly jealous of Chat. Ian tells us that Chat is also an avid lacrosse player. I’m more impressed that he works with Matt McGee.

Chat says they look at local as the great consumer mega trend. There was search, then commerce, social networking and now local. It will shape the way consumers interact with content online and create a tremendous opportunity.

Local is the online equivalent of local newspapers, print yellow pages, community forums, and radio.

Why is Local Important?

Every day millions of people use the Internet to research, discover and contact local businesses from dentists to auto repair shops. They determine which stores to buy from and how to get there. They plan their weekend activities.

There are about 15 million small businesses driving a huge amount of online spend. Roughly a million of them are advertising online. Local is growing rapidly.

[Oh, how I wish I could stop coughing. It’s severely limiting my ability to type. Or, I just need to grow a third hand. Either one would be great.]

The local consumer experience is fragmented and still evolving. There is not one leading source of local business information on the Internet. The lack of volume has resulted in national advertisers not allocating a significant amount of their budget to local. Offline transactions at retail outlets are difficult to track.

Small- to medium-sized businesses lack the time to manage search marketing and their business. Only 1M of the more than 15 SMBs do any form of search marketing (insane!). We need a trusted resource for online marketing. Seventy-one percent of SMBs prefer calls over clicks to their Web sites.

Why is Local Different?

Because it drives offline transactions.

• 86 percent of search engine users search for local products and services.
• 92 percent of Internet shoppers make their purchases offline.

Local search is different because it drives innovation. The consumer experience is evolving to better help users discover local businesses. There are greater refinement options, summaries for reviews and ratings, and more local content is coming online. There are new streams of innovative ad units and technologies. There’s pay per phone calls, video ads, better mobile applications and growth of Free DA. There are simple, more intuitive self-service tools to update and enhance organic listings.

Local is happening now. Local is about connecting high value consumers with relevant advertiser’s content in the most seamless and efficient way.

Benu Aggarwal is up.

It’s time to integrate local search into your overall online strategy. Get your ingredients together. It starts with your content. Make sure you’re using locally-based keyword phrases. They should be part of your research and integrated into your content. Always attack location-based phrases -- that’s for organic search engine optimization and PPC. Work local interests into your site design and programming. Target pure local search engines and maps. Pay attention to the yellow page sites. Provide information to business data providers. Target local and vertical listings, social media sites and get into online video.

Impact of Local Search: In the Golden Triangle, Local search results are at the top. [But aren’t we abandoning the Golden Triangle philosophy now that blended search kicks so much ass? – Lisa]

Quick Checklist for Local search

1. Research
2. Content: content for the search engines
4. Packages: specials, packages
5. Design: Optimize pages for local addresses and image names.
6. Promotion: This includes SEO.

Web 2.0 Strategies: Creating blogs and videos and posting them on your site. You want your blog to talk about local issues and what consumers are looking for. What local information are users searching for? Use Flickr and image tags to optimize images.

Top 10 Tips and Tricks

1. Make sure to integrate local as part of your overall online marketing strategy
2. Check if accurate information/data is coming up from IYPs
3. Check if you are listed on 2nd tier local directories and vertical directories
4. Fully optimize business Web site with alt tags, image names, business information listed as text, page and image names, etc.
5. Update your business profile on the main search engines by adding pictures, information and about business, coupons, maps, etc
6. Reference from other local sites
7. Local geographical based PPC
8. Optimize Web 2.0 Tools
9. Optimize your video for local search
10. Monitor UGC

Vik Advani is up.

Location Matters. If you own a pizza shop you are interested in people around that location or people that are going to be in that area. And if you want pizza, you want it close. [True that. When I want pizza, I want it in my belly – Lisa]

You narrow down a location of a user through geotargeting. Lots of innovation is happening down to being able to identify the user’s block. The better you can get a user’s location, the more effective your ad is going to be.

The great thing about mapping is that you don’t have to predict where the user is. The user tells you what they’re looking at. You’re focused on a very specific location. You can get all the way down to the block level.

Geotargeting on basic maps

You can advertise on maps using Google, but you can also geotarget your listings. You can narrow what city or states you want to target. You can put a point on a map and set a radius so that everyone with an IP location within that radius can see you on the map. You can even great custom shapes to block out certain areas.

If you have a local business ad, you can get a sponsored pushpin on the Google Map itself. This is really effective.

Gib Olander is next.

Local Search is about this:

• 67 percent of respondents said they prefer to make purchase in physical stores
• 69 percent research products or features online.
• 58 percent use the Internet to locate items before going to a store to purchase.

Local search is only partially about Web sites. It’s also about organizing your content outside and away from your Web site. There are more than 16 million US businesses. Less than 50 percent of business locations have an independent Web site.

Gib took a look at a typical local search result page. Of the 20 total links on that SERP (10 local + 10 Web results), zero are going to a local Web site. They go to map listings, but not a local Web site. You have to give Google some place to link to.

On Yahoo, of the 7 links above the fold, not one appears due to the content on a Local Business Web site.

Change this by creating a cloud of content for each individual business location. Keep in mind that the content must answer both discovery and recovery local search queries.

Recovery Content:

• A business name
• A business address
• All business phone numbers
• Business Web address
• Primary line of business
• Neighborhood services

• Products offered
• Business specialist
• Services provided
• Payment methods accepted
• Hours of operation
• Alternative lines of business
• Unique offers

Each business location should create and maintain a local search content cloud organizing content for recovery and discovery search.

Ian asks Benu to walk the audience through what a local PPC campaign looks like and the research need. PPC says to make sure that your landing pages are optimized. If you’re doing an exact match, your landing page has to be optimized to support that. She recommends spending 50 percent of your time thinking about local activities.

Ian launches into trivia time!

Q: Out of all queries, what percent of search queries use city or a state terms?

A: 5 percent.

What percent of search terms use a zip code?

5 hundredth of one percent. (I’d make that decimal but I’m not sure what it is. Math is delicious.) [Point oh five percent, I think? --Susan]

Chat stalks talking about the PPC campaigns Marchex does and says that their strength is in micro-campaigns. Chat says that if we work with a reseller, we develop a product that they sell, we get that and we create/optimize the campaigns. Our business is service, but it’s about scale. In our case, we probably rely on tried and true methodologies for breaking down keywords.

Ian says there’s no way that Google’s street view can be up to date and accurate. What’s the nature of the perishability of some of this rich media?

Advani: Right now it’s a lot of eye candy but they’re trying to make it more useful. There are things that can be done. There are methods involved. I think if you have the majority of the data correct, then you should be okay. Also, the images that are displayed on the store fronts really need to be brought out more. The problem with GSV is that you can’t tell what the business really is. There’s technology out there right now trying to clear it out and make the image sharper.

Going back to the PPC question, Benu says that they way they differentiate their campaigns is really difficult to do. We are always looking for data that will help us understand their market. What are people searching for? What do they want to do? If you’re doing PPC for others, it’s a good idea to get information from the business. Don’t just look at AdWords.

Question and Answer

For local search, two of our clients have multiple offices, how do we get each one of those offices showing up?

Gib: There are three different places to really rank: PPC – you want the landing page optimized best to the location. From a site perspective, you want to use a strong internal linking structure and use nice geographical modifiers. You want additional pages for each location. And then, focus on the offpage stuff. Each of those listings needs to have their own unique content. Each location is its own entity. Each of those you need to add the right descriptive information.

Benu: Google just launched a feed where you can claim your main business and then include a feed for all of your locations.

Given that Google Web search and Google Local use different algorithms, any theories why the Google 10 pack differs from the organic results?

Gib: In the Google 10 pack they have more businesses to choose from. If 50 percent of all business don’t have a Web site, it’s hard to serve that content up anywhere else.

[Li Evans is sitting to my right and whispers that the results are different because they use different algorithms. I have to agree with Li on that one.]

Posted by Lisa Barone on 03/18/08 at 10:03 AM | Comments (0)

Morning Keynote with Nick Carr

Morning! It’s time for the big Nick Carr keynote. Ready? Me too!

[Okay, we are rocking out to some trendy rock group that I am sure I would know if Susan’s crankiness wasn’t rubbing off on me. Oh, it’s Green Day, I think? Maybe. I think its Green Day. I think that’s what Li Evans just said to my left.

This keynote is schedule to start at 9am, but it’s 8:59am and the room is half empty and the stage is bare. I’m not sure what’s going on. I guess I’ll wait.]

And we’re off!

Nick jokes that it’s good to have the first slot in the morning after the most alcoholic holiday of the year. Hee.

He thinks we’re at a major turning point in the history of computing and the way we use computers. It will have a huge set of ramifications for the way we think about things – from media to society and for culture as well. Computer systems increasingly are at the center of the way we do business, the way we find media, the way we find entertainment, the way we communicate. A fundamental change in the technology will have enormous ripple effects. These changes aren’t just technology-related; they’re also the economic changes that will be set off by the new technologies. After all, it’s economics, not technology that affects how companies behave and affects what we do.

If you look at your own behavior over the last 5 years, you can already see that we’ve changed the way we think about computers. It used to be you’d have to buy a piece of software to do something new with your computer. Increasingly that’s becoming foreign to us. Now we just fire up our Web browser, go out into to the Internet, find the software we want to use and bypass the process of buying it and installing software on our computer. It’s the whole Web 2.0 movement.

So far, businesses have kept themselves at a distance with the Web 2.0 phenomenon. They’ve looked at it as something for geeks or people in their homes. But if you look at what’s going on you can see some parallels to what happened 25 years ago when we got the first personal computer. [I’m as old as the first personal computer?] At first it was kept out of the corporate world and then people realized it was hugely valuable. It forced corporations to adapt to this new technology. It didn’t only mean that companies bought lots of PC; it meant that they restructured their way of thinking about information technology.

He says the change we’re starting into today is even more fundamental. You have to go back even further in time to really understand the change. In fact, he’d argue the best place to start is back in 1851 when a man in Troy, NY built this magnificent machine. It was a water wheel and was the biggest and most powerful one at the time. This man knew that all factory owners had to also generate the power to run these machines. Power generation was something every company had to do on its own. They had to set up their own department, invest in their own equipment, etc. He knew he could get a competitive advantage if he could figure out how to dominate the power supply. What’s telling is not the picture of the water wheel, but what you would have seen if you went back to that site 50 or so years later. You would have seen that the wheel had been abandoned, left to collapse and overgrown with trees and weeds.

What happened?

Suddenly companies didn’t have to generate their own power thanks to technology innovations culminating in the creation of the alternating current generating system and the electric grid. Now companies could plug into a new network and get all the power they needed. As a result, they no longer had to run their own water wheels and they could abandon them and the time that went into them.

When you think about that and you put yourself into their shoes, it must have seemed like an incredible leap of faith. Something that you had always had to do yourself and now you are trusting it to a machine? Still, they did.

The old data centers are like the old water wheels.

In 1910, only 40 percent of the electricity generated in the US was directed by utilities. Just 20 years later, the utility supply of power had risen to 80 percent. That change would continue at that radical pace until it reached about 95 percent utility/ 5 percent private supply. A major change came about through industry as soon as you had an economically more efficient means of distributing a crucial technology resource. This was only the start of the revolution that would be the electrification of industry and society. The big news was that as soon as you moved to utility supply, you could drive down the cost of energy dramatically. What we saw was an explosion of innovation at the socket. It started with simple machines, but then business people started to realize that cheap power would allow them to completely change the way they manufactured their own products.

Computing is the next great important technology that is going to go through a very similar change – going through private supply to a central utility supply model. We’ll plug into a shared grid to get all the processing requirements we need. Information technology and electricity are the only two technologies that can be supplied over a grid.

If you look through the history of computing, you see that it follows a very similar pattern to power generation. The pattern of computing was established in the early years of the last century. Even as companies were shutting down their private power generation depts., they were building up their IT departments which would become the core of the economy. As new technologies advance, the power and application of computers rose enormously and we had the next great stage of computing in the 50s when we had the introduction of the mainframe into corporations.

The mainframe was incredibly efficient, very clean, neat, etc. The mainframe computer would operate at about 80-90 percent of its capacity. But it had a huge disadvantage – it was very impersonal. They could only be used for big institutional jobs. The average user couldn’t apply it to his own personal job.

As soon as we had the introduction of the PC, everything changed and computing looked differently.

Every company has to build a datacenter that has the same machinery and mostly the same software as all of its computers. It’s incredibly inefficient. Then they have to maintain it. But this is the only way that we’ve known how to deploy computing on a large scale. If you look at some of the stats, you see the incredible inefficiency of this fragmented model of computer. HP found that 80 percent of the average server capacity goes to waste and only 20 percent is actually applied. Seventy percent of IT labor goes to keeping the machine running. It doesn’t provide you with any business advantage; it’s just the cost of doing business. If you look more broadly, you realize that we’re all paying a big tax for this inefficient mode of computing.

If there were a more efficient way of deploying these resources, we could dramatically reduce the capital that goes into computing and IT and release it throughout the economy. Companies, instead of having to invest in peripheral activities, could invest that time and money in that main business. That’s where we are today.

Nick shows a picture of a Google datacenter in Oregon and says that animal sacrifices are going on in there. Hee. When did all these SES speakers become funny? Lisa likes.

Nick says that there’s a massive build out of the new computing grid that is going to transform computing.

Why is this happening now?

A number of things have changed at a tech level that make cloud computing unavoidable.

Moore’s Law: The power of computers for a given price is going to double about every 18 months. That’s played out throughout the last few decades. It underpins the explosion of computers. It has also meant that computing power has gotten cheap enough that we can move from having physical machines to replicating those physical machines in software, which is the trend called virtualization. This allows much of the build out of the utility computing system. You can get cheap generic servers and employ virtualization.

You also have to have an efficient means of distributing that power. You have to have the computer grid.

Grove’s Law: The capacity of network communications doubles only every century. What Grove meant was a dig at the telephone companies who he thought were dragging their feet and holding back the computer revolution. To tap into the huge, latest most efficient computing power, you’ve had to run your machines locally. With the build out of broadband Internet, suddenly the capacity of the network has begun to catch up with the power of the computer. Grove’s Law has been repealed and suddenly the network capacity catches up to computing power and you can deploy very sophisticated services centrally over this rich new grid. This is something Eric Schmidt predicted back in 1993 when he was working at Sun Microsystems. This is what we’re seeing today. The network is becoming the computer and the data center.

This isn’t only some theoretical occurrence. We can see massive investments among IT providers to businesses. The IT industry is acknowledging that a massive change is on the horizon.

What does this mean?

Just like the electrical socket brought a wave of innovation, we’re going to see similar effects come out the utility model of computing. It dramatically reduces the cost of computing and increases the availability. Pretty soon the network will be available everywhere. This is going to require a rethinking and a new wave of innovation that will affect all areas of commerce. One of the first areas is in rethinking corporate IT. It’s important to recognize the importance of this trend. As big companies move into the crowd, it will lead to new economies. Corporations are going to move their data center into the crowd. Create networks virtually out on the grid. Suddenly, all this physical machinery and the label required to maintain it becomes software. It moves out onto the utility grid. Anyone who thinks about how software applications are deployed is going to have to think about the interfaces.

The idea of cloud computing is that it’s built on the assumption that data should be shared, not isolated. It’s not about creating control anymore or hiding things behind your own firewall. Business is built on sharing. The real value comes when you can choose people to share information with and do it easily. What we have now is the ability to do this. He shows how Facebook users can customize their data streams and information flows. It’s just about moving levers up.

For many of us, this is becoming the natural way and the way computing should be delivered. It should put the users in control and work on the assumption that we can share information easily. It’s a radical departure from the systems we’re using today.

We’re going to start to see the ramifications begin to spread out and influence society and culture, the way people think and the way they live.

We’re seeing a blurring of the line between the consumer software business and the media business. They’re taking over each other’s characteristics. We can see it in new services being supplied over the net, like Mint. Free version of programs modeling Quicken or others. That means you have to have an indirect means of supporting these applications – advertising. Essentially, the media model is being applied to software. The success of human software is no longer being measured by the number of units sold; it’s affected by the audience and how much of their attention you can hold and your ability to monetize it. This is going to be a massive challenge for businesses, but will also open up big new opportunities for companies who can reengineer.

In turn, the media business is taking on many c