Bubble banners and search clicks
Type "How can Google make more money?" into the world's biggest search engine, and the top result is from Google's corporate-philosophy page.
The headline on that link: "You can make money without doing evil." That not-so-relevant result illustrates, to some extent, the crux of Google's challenge today, which is to find ways to improve results -- or make them as relevant as possible -- so that people find both search results and the accompanying advertisements useful. (Note: The result may actually be very true and relevant to some, but that's another story.)
After 18 months in which Google's RevForce unit -- a team of astute, maybe even elite, scientists -- tweaked and engineered the company's advertising system to produce the most relevant results, the Google team apparently has hit a plateau in its monetization efforts. (Or these bright guys just got tired and have opted for 50% playtime rather than 20%. They are human, after all. I think.) In essence, these engineers squeezed have the optimal number of dollars from each search query, judging from the concession made by Google's chief financial officer, George Reyes, this week that the company now has to "find other ways to monetize our business." The environment Google is in today reminds me of Yahoo in 2001. Just what area Google thinks holds the most revenue potential -- ads on images, ads on offline platforms, fees for services on mobile devices, fees for hosting blogs, premium services for hosting videos, delivering video and music, or facilitating transactions -- has to be the No. 1 question at Google's analyst day Thursday. Keep this in mind: Today, Google receives 97% to 98% of its revenue from paid-search advertising. How should Google monetize?
Comments