Page and Brin themselves once pointed out the problems of accepting ads or paid placement, with some rather ironic examples:
Furthermore, advertising income often provides an incentive to provide poor quality search results. For example, we noticed a major search engine would not return a large airline's homepage when the airline's name was given as a query. It so happened that the airline had placed an expensive ad, linked to the query that was its name. A better search engine would not have required this ad, and possibly resulted in the loss of the revenue from the airline to the search engine. In general, it could be argued from the consumer point of view that the better the search engine is, the fewer advertisements will be needed for the consumer to find what they want. This of course erodes the advertising supported business model of the existing search engines. However, there will always be money from advertisers who want a customer to switch products, or have something that is genuinely new. But we believe the issue of advertising causes enough mixed incentives that it is crucial to have a competitive search engine that is transparent and in the academic realm.
The main difference seems to be that today even getting the top organic search result doesn't provide enough clicks for advertisers, so they feel obliged to purchase ads for their own brand names even when they already rank first. If people searching for Southwest Airlines on Google aren't ending up on the Southwest Airlines website without a huge great banner ad (despite it being ranked at the top of the results) then something is going badly wrong on the Google search results page.
"If people searching for Southwest Airlines on Google aren't ending up on the Southwest Airlines website without a huge great banner ad (despite it being ranked at the top of the results) then something is going badly wrong on the Google search results page."
Perhaps the metric being optimised isn't conversion to home page landings. Perhaps there is something deeper in their funnel which benefits from the visual experience starting one click earlier.
The main difference seems to be that today even getting the top organic search result doesn't provide enough clicks for advertisers, so they feel obliged to purchase ads for their own brand names even when they already rank first.
It should be noted that this instance is simply a test and should not be taken as an indication of how these ads will be purchased. While I'm sure there will be numerous advertisers who feel the need to have a large banner when their specific brand is searched for, I expect them to be in the minority. The real question is will I be seeing a banner for Southwest when I search for JetBlue.
This may be fallout from trademark owners losing their various lawsuits against Google for allowing competitors to advertise on their trademark as keyword. (See this article: http://blog.ericgoldman.org/archives/2013/05/google_crushes....) So now they may be the top organic result (or even a navigation result) but JetBlue or United or whatever can buy a banner on top that has their airline telling the searcher how much better they are than the other guys. This is great for Google, now Southwest has to pay to advertise or get side swiped by a competitor, and because its an auction system their competitor can bid up the keywords to negatively impact Southwest, forcing higher ad rates. Win win win for Google, not so great for Southwest Airlines).
If they follow through with what you suggest, I wonder if it will be the straw that breaks the camels back in regards to an antitrust lawsuit by the government.
Why should that be the case? Google had defended and won most cases around the world where brands accused it of allowing competitors to show ads against their keyword searches. Why should banner ads be treated any differently by antitrust regulators?
The issue that I see (IANAL) is that these incremental changes to embedded advertising within search encroach ever-closer to a form of paid-search. When you own 60-70% of search, and you start requiring companies to pay in order to appear above the fold, we may have a problem.
I'm pretty sure the banner can only appear when you have the top organic search result. So JetBlue couldn't buy the banner for Southwest. Furthermore, the idea is that the user is trying to find Southwest so redirecting them to JetBlue would make not sense.
It may not necessarily be a win-win for Google. It could actually make search worse. Consider if I search for Southwest Airlines and get a big Jet Blue banner that takes up 88% of vertical space, this would actually make me very agitated as a search consumer - it's almost the same as displaying a popup ad.
"The real question is will I be seeing a banner for Southwest when I search for JetBlue."
It's not so much what you are going to see, as what you're not going to see. I'm sure BP is happy to buy a shiny image ad and take traffic away from wikipedias article on the deepwater horizon oil spill.
When searching for "BP", all of the results are relevant, but none are about Deepwater Horizon.
Interestingly though, at the bottom of the page, I see Google has an "In-depth Articles" section that has three articles, all about spills, two of them critical of BP.
>If people searching for Southwest Airlines on Google aren't ending up on the Southwest Airlines website without a huge great banner ad (despite it being ranked at the top of the results) then something is going badly wrong on the Google search results page.
Or maybe they are, and this is simply an example of a branding bonus/partnership for big spenders. We have no idea what the economics are and why.
Yes, in media buying, this is known as brand protection. It ensures that customers who already are searching for your brand and are therefore more likely to convert don't disappear off to a competitor.
Hence ironically companies will often pay more per click for these results than on more unrelated keywords.
When this happens I like to play a little game. If I think the company has loads of money (Apple, Shell), I click the sponsored link and help fill the coffers at Google. Otherwise, I click the search result and save the poor struggling company some cents.
What does this achieve? You're transferring an infinitesimal amount of money from, say, an Apple, to Google.
In turn, Google becomes even more of a monopoly (because previously organic clicks now become paid).
And the money Apple paid Google to win your click will need to come from somewhere. A reduction in some other head (organic optimization?) or from increased prices. We'd like to think it will merely reduce Apple's profit margin, but I doubt it.
It can make sense to buy an ad even if you are the top result. It basically makes your top result take up twice as much room. More room = more clicks. It also pushes any competitor links creeping up below your top result from being above the scroll. And of course, with this new sell out mechanic, you get even more than double the space to shove out your competition.
And a lot of people dont realize the difference between PPC ads and organic results - this is from direct experience at business shows talking to potential customers.
If people searching for Southwest Airlines on Google aren't ending up on the Southwest Airlines website without a huge great banner ad (despite it being ranked at the top of the results) then something is going badly wrong on the Google search results page.
Of course searching for "Southwest Airlines" will result in southwest.com being the first hit. The reason that Southwest buys its own banner is to prevent rival airlines from buying that same name.
Furthermore, advertising income often provides an incentive to provide poor quality search results. For example, we noticed a major search engine would not return a large airline's homepage when the airline's name was given as a query. It so happened that the airline had placed an expensive ad, linked to the query that was its name. A better search engine would not have required this ad, and possibly resulted in the loss of the revenue from the airline to the search engine. In general, it could be argued from the consumer point of view that the better the search engine is, the fewer advertisements will be needed for the consumer to find what they want. This of course erodes the advertising supported business model of the existing search engines. However, there will always be money from advertisers who want a customer to switch products, or have something that is genuinely new. But we believe the issue of advertising causes enough mixed incentives that it is crucial to have a competitive search engine that is transparent and in the academic realm.
http://infolab.stanford.edu/~backrub/google.html
The main difference seems to be that today even getting the top organic search result doesn't provide enough clicks for advertisers, so they feel obliged to purchase ads for their own brand names even when they already rank first. If people searching for Southwest Airlines on Google aren't ending up on the Southwest Airlines website without a huge great banner ad (despite it being ranked at the top of the results) then something is going badly wrong on the Google search results page.