Ask HN: What will happen to Google when somebody disrupts AdWords? • Hacker News Board

Re: Ask HN: What will happen to Google when somebody disrupts AdWords?

#31

Post by [deleted] » Mon, Aug 01, 2011, 11:27 PM UTC

sek wrote: post #24

pigbucket wrote: post #21

If a company has access to hundreds of millions of profiles, can figure out an effective way of delivering targeted ads, and can effect a fundamental shift in the way most people find content on the web (i.e., a shift from keyword search to social search/sharing), then Google's advertising revenue could fall significantly. The obvious existing threat is Facebook. Facebook ads are not good enough yet, but could be rel…

I heard these arguments before but nothing happened so far, facebook has still one of the worst return rate in the industry.

[deleted]

Re: Ask HN: What will happen to Google when somebody disrupts AdWords?

#32

Post by ig1 » Mon, Aug 01, 2011, 11:27 PM UTC

sek wrote: post #24

pigbucket wrote: post #21

If a company has access to hundreds of millions of profiles, can figure out an effective way of delivering targeted ads, and can effect a fundamental shift in the way most people find content on the web (i.e., a shift from keyword search to social search/sharing), then Google's advertising revenue could fall significantly. The obvious existing threat is Facebook. Facebook ads are not good enough yet, but could be rel…

I heard these arguments before but nothing happened so far, facebook has still one of the worst return rate in the industry.

Facebook could do a lot with advertising which they're choosing not to do at the moment. For example they could target ads based upon status messages which are much more transactional than profile data.

Re: Ask HN: What will happen to Google when somebody disrupts AdWords?

#33

Post by rachelbythebay » Tue, Aug 02, 2011, 2:18 AM UTC

ChuckMcM wrote: post #22

Short answer: As long as the portion isn't dominant in your portfolio, and you re-evaluate it at least twice a year and rebalance, its all good. Longer answer, looking at Googles rates of return on capital is like watching a very, very, fast train driving along straight track. Google's nominal operating mode burns a lot of money, that burn rate leaves them vulnerable to down turns. What the most likely scenario is no…

Some would say the "flip" has already happened.

I'd peg it to early 2009. Whenever they changed the shuttle schedules, if anyone remembers.

Re: Ask HN: What will happen to Google when somebody disrupts AdWords?

#34

Post by gcp » Tue, Aug 02, 2011, 9:01 AM UTC

jefflinwood wrote: post #26

I've wondered this myself - what happens when ad blocking technology becomes integrated into mobile devices, or the general public starts to use it because the newest, shiniest browser now bundles it by default?

The technology is available (Adblock for Firefox Mobile) but given that Google controls the default browser and ad revenue is important to Mozilla, it won't be defaulted for a while.

Apple is another matter. Maybe they like to keep their options open, too.

Re: Ask HN: What will happen to Google when somebody disrupts AdWords?

#35

Post by damoncali » Wed, Aug 03, 2011, 8:06 PM UTC

Google will be screwed. If something that works significantly better comes along, that money will evaporate very quickly. And when you take into account Wall St's grow or die mantra, the results would be catastrophic for Google.

However, I'm not sure it's possible to disrupt AdWords. Disruption in the classic sense implies "way cheaper, but not as good". You can't make advertising "way cheaper" without leaving metric tons of value on the table, and nobody is going to do that. After all, the quality of advertising is the price you pay for customers.

More likely is a scenario where everyone else catches up - but that's a slow process and will give Google plenty of time to find another trick.