There is no doubt that times are (very) tough and that many companies will inevitably fail due to a lack of funding over the coming months, but "history tells us that where there is chaos, there is opportunity".

Google, along with many other companies, rose out of the ashes of the dot com crash by focusing on producing a fantastic product and by spending money wisely.

Numerous studies have proven over time that companies that continue to market aggressively in dark economic times are often the ones that become more successful when things improve.

Search engine marketing is the perfect answer to the requirement to market your business without spending too much. We are, of course, biased but are there any other forms of marketing where you can guarantee to spend money ONLY on attracting an audience that is actively looking for your products or services?

This is the beauty of search. If demand falls, so will your spend. As long as there are people looking for your services, you should be doing everything that you can to ensure that you are getting in front of them to show how you can meet their requirements.

The choice is simple - hide from the grim reality of the current economic climate and cut all marketing expenditure (but suffer the inevitable reduction in market visibility and turnover) or batten down the hatches and ride out the storm but continue to invest in marketing that you know works.

Everything goes in cycles and the current situation was arguably long overdue. There will be an upturn though and it will be the companies that have continued to develop a strong range of products / services and continued to market these products / services to the world that will come out of the other side smelling of roses.

There are a number of factors that are used in the quality score algorithm, but click through rate (CTR) has always been critical.

An ad with a high click through rate, when compared to other ads that are shows for the same keyword, will be seen as very relevant to that search query and Google will give it a high quality score.

This is the underlying reason for split testing different ad copy - by running different versions of ads, you can monitor which messaging is more effective at attracting the attention of the user. Over time, you can eliminate poorer performing ads and ensure that you are achieving the best possible CTR which will, in turn, ensure that your quality score is as high as possible.

There is an interesting announcement on the Google Adwords blog detailing two key improvements to the quality score calculation:

• ad position will be included in the quality score algorithm
• only the best performing ads will appear directly above the organic results

By including ad position in the quality score algorithm, Google is acknowledging that most people click on ads in the top positions. Ads in top positions will invariably have higher click through rates than those lower down the rankings, so they will enjoy a higher quality score and effectively appear to be ‘better’ ads than those in lower positions. As a result, it can become very difficult to oust such ads from the top positions.

The change to accommodate the ad position in the algorithm should be a welcome change - a well crafted ad in lower positions should now be able to rise through the ranks much more quickly, as the CTR rate will be recognised as very high even if it is actually lower than that of the top ranked ads.

The second announced change is an interesting one. We are often asked why Google sometimes displays ads above the organic results and sometimes doesn’t. As indicated in the Google announcement, if the ad with the highest ad rank did not meet a certain quality threshold, then no ads would be displayed above the organic results.

The latest tweaks will allow lower ranked ads to move into that space if they have a sufficiently high quality score. The obvious question is why an ad with a higher quality score wouldn’t already be ranked in the top position anyway, so it is not immediately clear whether this is going to make a significant difference other than the fact that only the best performing ads will appear above organic results, which is essentially what happens already.

Only time will tell what effect these announcements will have on PPC campaigns and there is no actual commitment to when the changes are being rolled out. We wait with baited breath…

Browser Media is managing a series of paid search campaigns to help drive traffic to the campaign sites and to increase awareness of the charity.

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The search engine has been running a few variations on these tests; and has used the feedback to learn more about the quality of their results.

According to Google’s Matt Cutts:
"It’s a really fun experiment; I can’t say for sure whether it will go live for everybody because we’re always running a ton of experiments. Only some of those — the ones that are being very successful — are launched live for everybody."

Some have criticized Google for being too closed to user participation, and there are other search engines which have opened u to user participation -  Mahalo and Wikia Search both rely on contributions from the public to rate and improve their search results pages.

However, there are plenty of people who would have a lot to gain by manipulating Google’s result pages, to promote their own sites, or move those of competitors’ further down the page, and this would make any such system very difficult to police.

Cutts also argues that Google’s results already use some user input:
"A lot of times people think about Google as being nothing but algorithms and computers operating around the clock," he said, "But if you think about [Google's proprietary ranking system] PageRank, the way we judge how reputable a particular page is boils down to human judgments and actions in the sense that it depends on who is linking to whom on the Web."
 

The figures, released by online measurement firm comScore, revealed that 4.5m Europeans and 20.8m US mobile users used mobile search in June.

The growth in the use of mobile search has been driven by a number of factors, including the growing availability and use of smartphones such as the iPhone, and the introduction of more attractive data plans by mobile phone networks.

The highest penetration rates for mobile search were in the UK, at 9.5%, with the US following closely behind at 9.2%.

Unsurprisingly, Google is the leading search engine for mobile internet users, taking 63% of the market in the US, and 74% in the UK. In Spain, Germany and Italy it is even more dominant. Yahoo ranks second in all of these markets, with 34.6% of mobile search in the US, and 16.2% in the UK.

According to comScore analyst Alistair Hill:
“It is interesting to note that as we see the number of mobile search users increase, the frequency of activity is also growing. Meanwhile, the number of U.S. users accessing mobile search has more than doubled as a result of expanded 3G penetration and smartphone adoption, as well as the proliferation of flat-rate data plans. We have also seen a substantial improvement to the mobile search offerings in the U.S. market.”

We spend quite a bit of time defending Google to our clients and explaining how embracing Google’s quest for relevant search results is the most effective form of search engine marketing in the long term.

Every now and then we do, however, come across examples of the greed that many people despise Google for and find it hard to justify.

A recent example raises serious question marks about the search network, available to Google Adwords advertisers.

As an advertiser on Google Adwords, you can choose to display your ads on the Google content network, which will mean that Google will display your ads on sites within their content network that their algorithm determines to be relevant to the keywords that you target.

This has been enhanced (and improved) by the newer site placement option but this form of contextual advertising typically produces a far lower click through rate and vastly inferior overall performance when compared to a true search journey.

If a user is specifically looking for something, they are far more likely to be interested in your ads than if they are just reading some content on another site.

Google doesn’t specify which sites are included in their search or content networks (see http://adwords.google.com/support/bin/answer.py?hl=en&answer=6119) but you would hope that the search network would be restricted to search engines or, at the very least, sites that involve some form of active search.

We recently used the (excellent) search query performance report for some PPC activity we are managing for an online dating website.

The campaigns are structured around specific towns (e.g. Liverpool dating) and phrase match is used exclusively on a very narrow range of keywords.

The report highlighted that around 75% of the advertising spend was going on what appeared to be fairly suspect / unnatural searches, such as:

• guys seeking girls dating friends dating sunderland
• guys seeking girls dating friends dating sheffield
• guys seeking girls dating friends dating oxford
• guys seeking girls dating friends dating leeds
• guys seeking girls dating friends dating inverness

These phrases were triggering the ads as the keywords included phrases such as ‘dating sunderland’, ‘dating sheffield’, etc. but we were concerned that these ’searches’ looked extremely unnatural and they look suspiciously like automated searches.

We contacted the Google quality team to investigate who very promptly confirmed that these clicks were all coming from the www.gumtree.com website.

The actual process by which these impressions (and clicks) were being generated is where we have issues - the user is not required to actually search for anything.

The Gumtree homepage has a number of navigational links, as shown below (dating section has been highlighted):

Clicking on any of the links takes you through to a page that has a number of listings, including 3 sponsored links at the top, as shown below:

There is no indication that these sponsored links are actually powered by Google, although that is down to individual negotiations / agreements between the site and Google, but our main issue is that these ads are being shown as part of the search network, not the content network.

Is the user journey shown above a true search journey?

We do not think so. We believe that this is akin to adsense publishers disguising ads as navigational links to encourage clicks and do not believe that it is in anyone’s interests. 

Can we defend Google in this instance?

No - surely the definition of a search site is that a user must actively search for something rather than just click on a link. No doubt Google and Gumtree are doing very well from this arrangement, but it is not in the best interests of the adwords advertisers.

Unsurprisingly, this campaign has now opted out of the search network. We are missing out on traffic from the likes of ask.com but have seen a massive improvement in the quality of traffic overall.

Beware - the search network is not always what you may think it should be.

Google’s new web browser (known as ‘Chrome’) has been released in Beta version and promises great things.

After a very painless download and install, we have been playing with it this morning and overall impressions are fairly good, although our lovely new site looked appalling in it - some rapid changes to the style sheet have helped although there are a few bugs to iron out…

Despite the initial reaction of "Oh no! Not another browser to have to test and why can’t all browsers interpret CSS in exactly the same manner", the overall experience is a positive one and the new browser does appear to be fairly quick.

Speed is perhaps the greatest hope that we have for the browser - we typically have multiple tabs open and there can be a noticeable lag when using IE or Firefox (especially IE which can take a very long time to open on occasions as it loads up each tab).

Google Chrome promises great speed and, at first glance, appears to deliver.

Another very obvious change is the ‘all in one’ url bar - this now serves as a search AND url bar, which actually works very well. It also helps reduce the real estate taken up by the various toolbars / search boxes that you tend to end up with at the top of your browser window, which is a real bonus.

Too early to tell whether it will really make any difference but our initial impressions are positive and the assault on Microsoft is gathering pace (the more we use Google Docs, the more impressive we find it).

Do we need another web browser? Probably not, but it is worth downloading (link on www.google.com) to try out and no doubt the future will bring a host of plug ins which, for us, make Firefox the current web browser of choice.

***UPDATE***

We managed to crash the new browser using the site placement tool in the main adwords interface. Seems ironic that the only site that broke it so far was Google’s very own…

There are some very nice features (e.g. element inspection when right clicking on anything on the web page) but the lack of the Google toolbar is a very surprising oversight. 

The search tool has been in development for the past four years, and aims to help users input more accurate search queries, save time and effort, as well as reducing spelling errors. As users begin typing a word into the search engine, Google will suggest words and search terms beginning with those letters.

This should reduce the amount of typing a searcher has to do before hitting the search button, assuming that the correct term is suggested. The service will also correct common spelling and typing errors, reducing the amount of irrelevant search results. How this will affect long tail searches which may not appear in the suggest box, or sites looking to profit from misspelled queries remains to be seen.

Google Suggest had previously been available via Google Labs, for users with the Google Toolbar and on Google Maps. It will be rolled out on Google.com. Yahoo launched a similar tool, Search Assist on its search engine at the end of last year.

According to the search engine:
"We find that by providing suggestions upfront, we can help people search more efficiently and conveniently. Instead of just typing ‘hotels in Washington’ did you want ‘hotels in Washington, D.C.’ or ‘hotels in Washington State’? Don’t remember that song title or person’s name? Let Google help you search."

The suggested search terms will be based on a popularity ranking so the most common terms will be shown highest. It uses general search patterns to determine this, rather than tailor the suggestions to the individual web user.
 

The research, carried out by comScore on behalf of Publicis Group and Yahoo, looked at the habits of more than 6,000 web users, finding that brands generated 160% more awareness than they would have done if consumers were not exposed to their paid search ads.

The study was restricted to consumer packaged goods such as food and beauty products, a sector which typically spends less on paid search ads than others. Yahoo has an interest in encouraging brands like Coca Cola and Mars to increase their paid search spending.

Consumer packaged goods firms only accounted for 2% of total search ad spending in the US last year, according to figures from eMarketer.

The positioning of search advertising also has an influence on brand awareness – the study found that consumers were 20% more likely to have a positive perception of a brand in the top paid search slot and would be 30% more likely to purchase a product.

The study follows similar research carried out last year which found widespread use of search engines for packaged goods categories. A further study is being carried out to assess the impact of paid search ads on purchases of these goods made offline.

According to the report, from the Pew Internet & American Life Project, the percentage of web users who regularly consult search engines has grown from a third in 2002 to 49% this year.

The most popular internet application remains email, with 60% of internet users writing or receiving emails on an average day. The use of email has been growing at a slower rate than search; 52% used email in 2002, a growth rate of 15%.

Other popular online activities included checking the news (39%) and finding out about the weather (30%).

There are age and gender usage variations, with men more likely to consult search engines than women, and younger web users more likely to use search than older users.

53% of men will consult a search engine on a typical day, compared with 45% of women while, of the under 49 age group, up to 55% use search regularly, compared with just 40% of over-50s.

According to the report: "With a growing mass of Web content from blogs, news sites, image and video archives, personal Web sites and more, Internet users have an option to turn not only to the major search engines, but also to search engines on individual sites as vehicles to reach the information they are looking for."

Google’s market share in the US was almost 70% in June, while in the UK this dominance is even more marked, with recent Hitwise stats giving it 87% of all searches in the same month.

At the RBC Capital conference in San Francisco this week, online marketers have been giving their opinions on Google, regretting the fact that its huge market share limits their options when planning search ad campaigns.

According to one marketer:
“In the last 10 years, I’ve seen a dramatic decrease of competition between Google, Yahoo and Microsoft, and that’s increased the importance of success on Google. When our clients come to us to talk about search, what they really mean is, ‘Let’s talk about Google.’”

Some also regretted the breakdown of a possible deal between Yahoo and Microsoft, which could potentially have created a more formidable opponent for Google in the search advertising market.

However, Google may dominate, but this does not mean that other search engines should be discounted. Many pointed out that rivals Yahoo, Ask.com and Live Search can all perform well for search ad campaigns.

The funding will be used to expand the company’s staff and further develop the company’s technology, which it has been working on since 1998. The investment comes from Octopus Ventures.

The search engine is developing natural language search, meaning that it can answer direct questions asked by its users. It has some similarities with US firm Powerset, which was acquired by Microsoft last month.

According to True Knowledge Chairman William Reeve:
“True Knowledge’s exciting technology has impressed everybody who’s seen it over the last few months and it is terrific for the team, as well as for Cambridge and the UK as a whole, that this confidence has been reflected in one of the biggest pre-revenue fundraisings in the European venture sector this year”

The site is currently in private beta with 10,000 testers but plans to launch in the next twelve months. It will work as a standalone answers engine, but will also produce white label versions of its search technology for other companies to use.

Cuil (pronounced ‘cool’) was developed by Stanford professor Tom Costello and his wife Anna Patterson, a former Google search architect. The staff at the search engine also includes Russell Power and Louis Monier, who both worked at Google before joining Cuil.

The new search engine claims to do better than current search techniques which focus on links and traffic patterns, and will instead analyse the content of each web page to give more relevant search results.

According to co-founder Tom Costello:
“Our significant breakthroughs in search technology have enabled us to index much more of the Internet, placing nearly the entire Web at the fingertips of every user.”

There are no ads on the search engine at the moment, but Cuil eventually plans to make money by placing ads alongside its search results.

Given the claims about the size of its index and the relevance of its results, reaction to the new search engine has been underwhelming, with many bloggers running tests on Cuil, and finding that Google still beats it for the quality of its results.

According to TechCrunch:
“A search for Dog returns 280 million results on Cuil and 498 million on Google. Judging relevance of results is subjective, but Google returns Wikipedia as the first result, then dog.com. Cuil returns Dog.com, Wikipedia isn’t listed on the first page of results. Both are meaningful results, but Google is better.”

This is the number of unique URLs that Google knows of – the search engine does not necessarily make all of these URLs searchable, as they do not always lead to unique web pages.

Still, the figure gives you an idea of how big the internet is, as well as how many pages Google can index.

According to the Google Blog:
“So how many unique pages does the web really contain? We don’t know; we don’t have time to look at them all! :-) Strictly speaking, the number of pages out there is infinite…But this example shows that the size of the web really depends on your definition of what’s a useful page, and there is no exact answer.”

There is little benefit to the search engine in indexing every one of these pages, as many are duplicates, or very similar to other web pages.

In 1998, the first Google index contained 26 million web pages, and had grown to 1 billion by 2000. Google used to display the number of pages it indexed on its homepage, but dropped this statistic in 2005.

While Google’s share has been increasing, that of its rivals has decreased, especially when you look at the year on year figures.

According to Hitwise, while Google’s share of searches has increased from 63.9% in June 2007 to 69.1% in June this year, Yahoo’s share has dropped from 21.3% to 19.6% over the same period, while MSN has fallen more dramatically, from 9.8% to 5.4%. The only search engine not to see its market share drop was Ask.com.
The remaining 42 search engines in the US market accounted for a combined total of just 1.7% of searches, a fact which highlights the uphill task which any new search engine has to break into the market.

Hitwise also looked at search market share in the UK last month. Here, Google is even more dominant, accounting for 87.3% of all searches, only slightly more than May, but a significant increase on June 2007, when it had 79.5% of the market.

As in the US market, Google seems to have eaten up the market share of rival search engines. Yahoo’s share of UK searches has fallen from 7.7% to 4% year on year, MSN from 5.7% to 3.7, and Ask.com from 4.6% in June 2007 to 3.1% last month.

The Ipsos / Enquiro survey, which uses search data from Europe, aimed to look at the role of branding in search marketing.

It found that a prominent presence on search results pages was a significant factor in brand building – being top of the organic listings ‘raises purchase consideration of a brand by 4%’, according to Google’s Henry Eccles.

Meanwhile, having the top paid listing lifted purchase consideration by 20%, while, according to Eccles:

“The gold standard is being top of both organic and sponsored listings. This combination raised purchase consideration by 22%. We’ve seen the same lifts for all verticals, including FMCG, retail and technology, and all markets, so we believe this is brand, vertical and market agnostic.”

The preliminary results of Google’s survey are backed up by previous research by eyetracking firm Enquiro Research at the end of last year.

Using Honda at the test case, it found that that purchase intent increased when the brand occupied the top paid and organic slots in the rankings – people were 42% more likely to recall the brand.

This means that startups and other firms will be able to build new search engines without the need for the large investments that a company would need to build such a service by themselves.

In return for the use of its data and technology, Yahoo will sell advertising on these new search engines, hoping to create another source of income for the company.

Yahoo is hoping that these new search engines will collectively be able to carve out a significant share of the market.

Yahoo has estimated that startups would require investment of $300m to create search technologies from scratch, so this move will make it possible for smaller companies to enter the market and, Yahoo hopes, take some search market share from Google.

According to Prabhakar Raghavan of Yahoo Search:

“We want to disrupt the search market by removing that entry barrier and make room for more players and more ideas.”

Raghavan hopes that, over time, Google’s search share will fall below 50% while its own share, with the help of BOSS, will double.

The two companies account for more than 75% of searches worldwide between them, and US officials are worried that the link up would give them too much control over the search advertising market.

The Department of Justice has been looking at the deal since mid-June, but announced this week that it would now be launching a formal investigation.

Under the deal, which is effective only in North America, Google provides advertising in Yahoo’s search results, with the two firms sharing the revenue.

While Google accounts for around 63% of worldwide searches, it is even more dominant in some European markets, the UK included, and there are concerns that an extension of the deal outside North America would be anti-competitive.

The Google-Yahoo deal does not have to be approved by US antitrust authorities to go ahead, as the two companies do not plan to merge, but the government could challenge the arrangement in court if it felt that competition between the two would be restrained.

Both companies have now agreed to give antitrust authorities three months to look at the deal before going ahead.

Currently, the search engines cannot index content that is displayed via Flash, as the software appears like an opaque box to Google and Yahoo’s crawling software. This means that lots of sites that use Flash have been missing out in the search engine rankings.

Webpages designed using Flash can display photos, animation, videos and text, and Adobe is providing the two search engines with the software code to help Yahoo and Google to see this previously hidden content, though some elements of Flash content will remain hidden.

Now Google users will be able to search through code within the Flash file itself, as well as on Flash banners, buttons and menu, while Yahoo plans to update its own indexing.

According to Google’s Ron Adler and Janis Stipins:
“In the past, web designers faced challenges if they chose to develop a site in Flash because the content they included was not indexable by search engines. Now that we’ve launched our Flash indexing algorithm, web designers can expect improved visibility of their published Flash content, and you can expect to see better search results and snippets.”

According to Adobe, Google is already beginning to serve up search results which include Flash files, while Yahoo will update to its search engine soon. 

According to the Venture Beat blog, a deal has been struck between the two companies, with the price expected to be around $100m.

Powerset is a much hyped search engine which uses semantic search technology which allows users to search using simple phrases, and questions as well as keywords. In theory, this makes the searches more accurate than normal keyword search.

Despite the hype and the $100m valuation, Powerset has only launched a limited version of its search engine up to now. This beta version only indexes results from Wikipedia, and the company has yet to prove that its approach works.

The price tag on the deal may be less than Powerset’s investors were hoping for, after the company was valued at $42m after a first round of funding in 2006.

Microsoft will be hoping that the acquisition will help to company to gain an edge on Google and its other rivals in the search market.

Microsoft’s Steve Ballmer said last week that search is a priority for the company:
“We don’t have to dominate, but we’d better have a darn good chunk of the search market over time, and we’re working away at it.”