More On Distribution Fraud in Search
Happy New Year everyone; I've not posted in ages, but hopefully I'll have a bit more time to post going forward.
I wrote back in December about distribution fraud in the world of search, and the article quickly became the 3rd most read entry on my blog. In it I talked about the fact that a growing percentage of Google's search network traffic is, in fact, AdSense for Domains traffic where there's no searching involved - only navigational clicks and non-contextual ones at that.
Google's decision to condone this distribution fraud will cost them tens of billions in market cap - mark my words. For the time being it appears they're going to choose pleasing investors over pleasing advertisers, and the result will be either
a) chargebacks by advertisers, perhaps aided by class action lawyers who, unlike SEM's and advertisers, don't need to stay in the good graces of Google to conduct business
b) accelerated advertiser adoption of Ask.com and AOL direct ppc ad buys. After all, once an advertiser has Google.com, Ask.com and AOL search traffic, they can turn of Google's search network with no appreciable loss in conversions.
c) accelerated adoption of Yahoo and MSN ppc
d) hastening of the arrival of the point of diminishing returns for advertisers on Google and thus deceleration in Google's growth rates
There's a SEW thread on the topic of AdSense for Domains; start reading post #21 on page 2 and go from there. The thread started over a year ago and picked up again early Jan ’07. In it there are some pretty powerful, negative anecdotes on the ROI advertisers are seeing from AdSense for Domains – and strong opinions on why Google is doing evil by not letting advertisers opt out of it.
The second is an equally detailed blog post by Richard Ball at Apogee Web Consulting which covers both the history of AdSense domain traffic and what appears – to Richard and I and many others, at least – to be a very clear cut case of Google’s revenue ambitions getting the better of their ‘do no evil’ mantra.