Google's announcement of a commercial developer program for its paid search management interface (API) and the mystery surrounding the new fee structure will definitely make the top ten search buzz list for 2005. While rumors fly about high costs of entry, search advertisers and agencies are starting to ask more difficult questions about the role of third parties in the search mix.
How often do you update your bids? How much bandwidth do you think a search program should use? Have you invested in a comprehensive paid listing management tool or application to help you in your search marketing process? What is the investment of an unbiased third party worth?
In last week's column, I asked readers to sound off about the developing world of paid search management. Unsurprisingly, few felt comfortable enough to comment on the record -- but some brave souls did, as you'll soon see. Suffice it to say, there are plenty of opinions surrounding changes to an API and the immediate impact third parties have on paid search.
Stop the conspiracy theory
The search engine marketing firm Fathom Online's chief executive seemed the most optimistic about the change. Chris Churchill suggested this was merely a move to slow down abuses of the tool and that advertisers should consider the impact real time bidding has on paid search management.
Prashant Desai, director of product management at Reprise Media, asks "What's Your Damage, Google?" in a recent post to the firm's blog. Desai encapsulated the need for an API in the search management role and criticized the move to charge for the interaction:
"Through the API's elimination of human to human interactions via technology to technology interactions, our SEM managers are able to concentrate on strategy and tactics rather than engage in the old school method of spreadsheet heavy-lifting. Why is this important? Well, since Google now controls the search superhighway, this means they are essentially charging you a high toll to get into the fast lane and penalizing the very companies that helped them achieve a $300+ stock price / $86+ billion market cap."
Historically, when a firm seeks to charge for access to a service that was previously offered free or at a discount, the impetus for the change lies in the need to cover costs of service and limit the ability (or tendency) for third parties to abuse the privilege of using the service.
Or is there a bit more to it?
Gene Daly, president of Ketchum Directory Advertising, offers the following: "Being a big picture kind of guy, I'd hazard a guess that their motivation is $500 per share."
Bob Heyman, chief search officer for Mediasmith adds his two cents, "[the change] means higher costs will be passed on to advertisers. How else do you keep showing the numbers that can in any way justify the $400 (soon to be $500) stock price?"
Google has to protect its interests doesn't it? A $500 stock price seems to be an admirable goal and certainly couldn't be described as evil. Moreover, it's not as though Google is hiding its API terms and conditions, even if few advertisers using third parties to manage search initiatives ever bother to read them.
The message is pretty clear: build an interfacing search application at your own risk. It doesn't get any simpler than that.
Thrill seekers abound
On the other hand, developers do have a tendency to want to game the system, and that in turn leads providers to set restrictive controls on application interfaces. As is often the case with developers, the very nature of the need to build an interface would assume there are enhancements to be made to the existing system.
That would be an arrogant assumption, wouldn't it?
According to the Wall Street Journal's November 28, 2005 cover story on Google's growth, the search giant is hiring about 10 people a day and employs some 300 freelance recruiters to help them build their talent pool. Google is going to great lengths (and expense) to find the best and brightest developers. Employment packages in the millions are not uncommon.
Surely, with the best and brightest in place there wouldn't be a need for any enhancements or third parties?
Who will cry for the agencies?
There really isn't a search industry advocate for the search marketing agencies and third party developers. Every industry organization accepts "contributions" from search sites and in the process negates the possibility of acting in the interest of agencies.
The last time a search industry organization was formed search sites were quick to jump on the bandwagon with financial support. Of course, the downside of financial support lies in the benefactor's ability to exercise control and influence over the message and mission.
He who has the gold makes the rules. One reader responded to my inquiry for feedback with some pretty powerful thoughts on a search site's ability to control third parties in the search business, but she asked that her remarks not be published for fear of reprisals from a search site. This wasn't mere paranoia: she has experienced retaliation for recent comments.
The reader's name isn't important. The names of the industry organizations are even less important. Given the sheer size and resulting influence of search providers, combined with the collective lack of standards in the search business, it would be difficult or impossible to orchestrate a third party representative entity.
As a result, calls to action are left unanswered. Refine your terms and conditions to expand liability for your actions. Help protect the interests of third parties that bring you revenue by offering guarantees and make-goods. Don't hold your breath.
Commemorate search week
iMedia's Search Week is cause for celebration. This week, we have seen input from thought leaders and industry gurus seeking to enhance the presence and position of search marketing.
In recent years, our collective search engine marketing intelligence throughput has increased dramatically, and I am proud to see so many contributions to the collective good without fear of reprisal from those who would seek to influence opinion.
I have missed out on the occasional party invite and experienced first hand what the sword of power will do to try and influence the written and spoken words. I have been called "too controversial" and even missed out on some industry business because of my tendency to explore viewpoints beyond what is fed to us by public relations machines and reciprocal editorial content. The definition of evil seems to be a bit subjective at times.
So be it. Happy Search Week.
iMedia Search Editor Kevin Ryan's current and former client roster reads like a "who's who" in big brands; Rolex Watch, USA, State Farm Insurance, Farmers Insurance, Minolta Corporation, Samsung Electronics America, Toyota Motor Sales, USA, Panasonic Services, and the Hilton Hotels brands, to name a few. Ryan believes in sound guidance, creative thought, accountable actions and collaborative execution as applied to search, or any form of marketing. His principled approach and staunch commitment to the industry have made him one of the most sought after personalities in online marketing. Ryan volunteers his time with the Interactive Advertising Bureau, Search Engine Marketing Professional Organization, and several regional non-profit organizations.
Ryan is Managing Partner at Kinetic Results.