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Google: End of the Online Advertising Bubble

kalkis-research.com

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Re: Google: End of the Online Advertising Bubble

#131

Post by rufb »

I'll start by pointing out that this article makes no sense whatsoever for large businesses and agency-managed campaigns, where expertise and scale mean CPC and CPM are analytical tools and not goals. When you have enough expertise to integrate data and attribute results, it makes no sense to optimize for anything other than ROI/CPA.

Now. Both Google and Facebook get a lot of revenue from small and medium businesses. SMBs often have short budgets, little expertise and limited work-hours to dedicate to online advertising, so it's not at all uncommon for them to concentrate all or most of their effort into a single platform.

For that reason, both Google and Facebook have a constant incentive to constantly innovate in formats, targeting options and channels catered to long-tail small pockets.

The problem with this article is that it mixes large and small. The over-crowded web display network caters mostly to big fish (common-enough exception: small fish by proxy, through retailer campaigns). Am I saying SMBs running web display campaigns is unheard of? Not at all, but clearly that's not Google's strongest proposition. For SMBs, that would be Search. App display and exclusive channels (such as Gmail's promotions inbox) being the next logical step.

Now I work at a fairly specialized agency so I can only guess what my online advertising portfolio would look like if I were an SMB or a boutique agency with off-the-shelf solutions for SMBs, but I honestly don't see Google being ruled out or even majorly threatened for most use cases by this inflation in the web display network.

Large companies and agencies will keep otimizing display campaigns for ROI/CPA. Small businesses (and their agencies) will flock around either Facebook or Google Search mostly, as they already do.

Re: Google: End of the Online Advertising Bubble

#132

Post by goldbrick »

Udik wrote: post #91
goldbrick wrote: post #88

Earlier quoted context omitted.

But you have to ask, why would Google go to all the trouble of being your personal experience curator? Google is not in that business. They are interested in showing you the highest value ad that they can, and obviously that's nail polish.

Because Google gets money from advertisers. Advertisers in turn pay Google because it makes them sell more. So the more Google is able to provide me with ads that make me buy something, the more the advertisers will pay Google. Taking the money of the advertisers and not boosting their sales doesn't pay on the long run.

You contradict yourself.

> Advertisers in turn pay Google because it makes them sell more.

> Taking the money of the advertisers and not boosting their sales doesn't pay on the long run.

Which is it, advertising on Google boosts sales or no?

Re: Google: End of the Online Advertising Bubble

#133

Post by blowski »

a_small_island wrote: post #107
onion2k wrote: post #41

Earlier quoted context omitted.

Google ads in search will always be valuable because you can advertise nail varnish to people who have just searched for "buy nail varnish". Google and Facebook both have the problem that their business model is predicated on having thousands of small advertisers bidding on ads. That's what they leverage to generate profit. In any market that's dominated by a single entity that smaller companies won't compete with fo…

>When the majority of people who want to buy nail varnish bypass search entirely and go straight to Amazon Do you even do this? My guess is the majority will never do what you're setting out to believe. Strictly speaking of Amazon, they don't even have the best prices these days.

I use DuckDuckGo hash bangs - !auk nail polish

Re: Google: End of the Online Advertising Bubble

#134

Post by xivzgrev »

Udik wrote: post #43
red_admiral wrote: post #15

"Facebook on the other hand, has a better control of who is actually seeing its ads, and will benefit from the turmoil by gaining market share." Did they pay you to write this? Google ads in search will always be valuable because you can advertise nail varnish to people who have just searched for "buy nail varnish". This is also about the millionth post I've read which assumes that companies simply throw money at adv…

> Google ads in search will always be valuable because you can advertise nail varnish to people who have just searched for "buy nail varnish" Yes, how dumb is that? A few weeks ago I googled for a company I was going to interview with. Since then the ad spaces in my web pages have been filled with ads of this company, which sells IT services for logistics. I'm a sort of atypical consumer - not very willing to spend m…

I run remarketing campaigns. One thing they can do is exclude people who visit job related pages. Its small but saves a few bucks (and annoyed interviewees).

Re: Google: End of the Online Advertising Bubble

#135

Post by nostrademons »

Udik wrote: post #43
red_admiral wrote: post #15

"Facebook on the other hand, has a better control of who is actually seeing its ads, and will benefit from the turmoil by gaining market share." Did they pay you to write this? Google ads in search will always be valuable because you can advertise nail varnish to people who have just searched for "buy nail varnish". This is also about the millionth post I've read which assumes that companies simply throw money at adv…

> Google ads in search will always be valuable because you can advertise nail varnish to people who have just searched for "buy nail varnish" Yes, how dumb is that? A few weeks ago I googled for a company I was going to interview with. Since then the ad spaces in my web pages have been filled with ads of this company, which sells IT services for logistics. I'm a sort of atypical consumer - not very willing to spend m…

When a random person searches for a company, it's probably > 100:1 odds that they're interested in the company's product, not in a job at the company. That's why companies put their products on the landing page and not their job openings.

You have to understand that whenever you do anything as a consumer in modern corporatism, you are part of a numbers game. The company does not care about you, they care about the aggregate "you" that represents the average of millions of consumers. If 100x as many people search for a company hoping to buy its product, then it only becomes rational to spend engineering effort if the opportunity cost of losing the one customer who is job-searching is 100x greater the lift that can be achieved by fine-tuning the product-buying case. Retargeting would have to be pretty tapped-out for that to be the case.

I face a similar problem - as an entrepreneur, when I Google a company, it's usually because it's a potential competitor that I want to learn about. As a result, my YouTube & AdSense feeds are filled up with ads for competitors. Which is kinda handy, in a way, but probably not why those competitors are buying ads.

Re: Google: End of the Online Advertising Bubble

#136

Post by dalke »

deprave wrote: post #120
jonatanheyman wrote: post #72

Earlier quoted context omitted.

Rather than using the URL bar, I think it's more likely that people will just open their Uber app, flight booking app, shopping app, etc. I don't think that is an unlikely development.

I agree. Here's what Steve Jobs had to say about this, in the context of mobile search: https://www.youtube.com/watch?v=JC8LR9cryG0 If we assume that different search queries are better served by different engines then I wonder if it's not possible for someone to develop a "thin" search engine that would do semantic analysis of the query and then redirect it to one or more sites, or show results side by side...

I believe you're referring to metasearch engines, like Dogpile.

Re: Google: End of the Online Advertising Bubble

#137

Post by at-fates-hands »

melvinmt wrote: post #102
austinsharp wrote: post #97

Earlier quoted context omitted.

There have been rumors that Google is planning a new, entirely separate messaging service, with bot integrations etc. http://venturebeat.com/2015/12/22/google-is-reportedly-devel...

Brace yourselves, Google is launching something social again... This is why I have mad respect for Zuckerberg. He's willing to place gigantic bets (Instagram/WhatsApp) when and where it matters.

There are a ton of thing I hate about Zucks but have to respect his foresight by making very timely and smart purchases to expand his brand.

Re: Google: End of the Online Advertising Bubble

#138

Post by Udik »

goldbrick wrote: post #132
Udik wrote: post #91

Earlier quoted context omitted.

Because Google gets money from advertisers. Advertisers in turn pay Google because it makes them sell more. So the more Google is able to provide me with ads that make me buy something, the more the advertisers will pay Google. Taking the money of the advertisers and not boosting their sales doesn't pay on the long run.

You contradict yourself. > Advertisers in turn pay Google because it makes them sell more. > Taking the money of the advertisers and not boosting their sales doesn't pay on the long run. Which is it, advertising on Google boosts sales or no?

> You contradict yourself.

No. Please try to understand what I wrote.

Re: Google: End of the Online Advertising Bubble

#139

Post by [deleted] »

novaleaf wrote: post #125
red_admiral wrote: post #15

"Facebook on the other hand, has a better control of who is actually seeing its ads, and will benefit from the turmoil by gaining market share." Did they pay you to write this? Google ads in search will always be valuable because you can advertise nail varnish to people who have just searched for "buy nail varnish". This is also about the millionth post I've read which assumes that companies simply throw money at adv…

This article may be hype, but the Google Adwords monopoly is very real and I wish it died. I run a SaaS startup (PhantomJsCloud) and tried adwords. No advertising competition, and targeted very specific actionable search queries. Google charges upward of $5.00/click. I can understand they want to cut spammers saturating every random search query, but how am I going to get a positive RoI on that kind of cost?

[deleted]

Re: Google: End of the Online Advertising Bubble

#140

Post by cpeterso »

Rzah wrote: post #50
onion2k wrote: post #41

Earlier quoted context omitted.

Google ads in search will always be valuable because you can advertise nail varnish to people who have just searched for "buy nail varnish". Google and Facebook both have the problem that their business model is predicated on having thousands of small advertisers bidding on ads. That's what they leverage to generate profit. In any market that's dominated by a single entity that smaller companies won't compete with fo…

Of all the things that might happen, users going directly to websites rather than through google/facebook is by far the least likely. Whats more likely to happen is that someone will come along with better search with less advertising (just like Google did), or someone might build a better social network with less advertising (just like facebook did). There's as much precidence for these things reoccurring as there i…

I disagree completely. People trust sites like Amazon and prefer them if they have already registered an account or are Amazon Prime members. When you want to buy a new CD, do you just google for the band name or do you head to amazon.com (or your preferred music site)?
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