Google Adwords Team reacts to ad placement controversy

Google Adwords team has put up a response on its blog in regards to yesterday’s post at Central Desktop blog which claims that Google is giving unfair positioning to its own products in the advertising ad results. You can check my post in that context out here. Below is an excerpt from the Adwords blog post written by Walter H., from Google Marketing:

That said, there are no special buttons to push or levers to pull that give our internal account managers special treatment or leverage. Quality Score is automatically evaluated in the same way for our keywords as it is for any advertiser’s keywords. Likewise, the potential to show up in the top spots above the search results is the same for Google’s ads as it is for any other.

Further Walter mentions that:

As such, we do not intentionally try to secure a top position. In fact, we generally aim for a more ‘conservative’ position.

I am not sure whether Walter is talking about Ads for Google products or for all the ads placed through the Google Adwords system. If it is the former it will be interesting to know what means are used by Google to maintain a ‘conservative’ position when in fact the system is supposed to be automated. Also this statement comes from Google Marketing which makes it confusing which side he is representing- Adwords or Business/Product Teams(Docs, Blogger, Gmail). Doesn’t the Google individual cost centers take a look at their revenues and forecasts before deciding how much they want to spend on advertising. It would be nice to hear from Adwords and others involved.

Still I appreciate the fact that Google listens to what goes on in the blogosphere and does take time to reply. So as part of my due diligence(I should have done this earlier though), I ran few searches on SpyFu for the keywords mentioned on CD blog. I have written about SpyFu last week which basically lets users estimate what a particular keyword will cost on Google Adwords system per/click basis, and the approximate amount you will need to spend on a campaign for that keyword per day.

The results at SpyFu for each of these keywords came out to be very interesting. Most of these keywords don’t cost as much we might have expected them to cost. Take the case when you search for the keyword ‘blog’ on Google. Top Ad results is for ‘blogger.com’. SpyFu says that the price for this keyword on average is $.58 per click and per day campaign will approximately cost $1277. Similarly advertising for the keyword ’email’ puts Google down on average by $9999/per day.

This investment on advertising is not much as compared to the return Google gets from its products. Consider blogger which has a built-in plugin for Adsense that users can easily use to display ads on their blog. As users sign up after the clicking on these ads for keyword ‘blog’, it makes the Google loop more efficient. So being in top makes it that much more important which right now is very much affordable for Google. The discussion might be more relevant in future as Google tries to establish its tools and applications in a competitive market that might see increase in CPC of these keywords and it position on using the homegrown advertising giant to its advantage. Will Google be able to prevent the misuse of it’s own system? Will Google still remain transparent?

Note: Before going ahead with other searches at SpyFu remember that the data might be 30-60 days old. Hence results might be out of sync for keywords like ‘spreadsheet’, which now shows ads for ‘Google Docs’, which is a very recent introduction at Google.

Links:
Google response
CentralDesktop blog post

 

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12 Responses to “Google Adwords Team reacts to ad placement controversy”

  1. Isaac Garcia Says:

    Add up your estimates for those four words (there are many more than those few that Google is “buying”) and multiply X 365 = $7,636,898.00/year

    That is a significant amount of $$$ to be spending on keyword buys for FREE PRODUCTS! That number will DWARF the advertising budgets for all of the “emerging Office 2.0” products – companies combined BY A LONG SHOT.

    And thats just 4 keywords.

  2. vivpuri Says:

    Isaac,

    Consider this as an investment. Google plans are much bigger than they seem right now. Moving to Writely from Microsoft Word is not possible in the current environment ’cause of the number of year people have been using it. But Google’s slow penetration into universities and colleges today is going to make users ready for prime time use of Google Product tomorrow when they join jobs. In the meantime as SaaS catches up in the market and companies looking for low cost hosted options, they will see Google as the best option since users will already know their way around the product.

    I understand that from a startup perspective spending millions on advertising is not feasible. But do we really have an option? I think if the competing product has real value, how much ever Google advertises it wont be able to be the market leader. Take the case of Google Video vs Youtube.

    Anyway Gmail should be a very-very profitable product for Google right now. And so will be blogger. They might have similar plans for JotSpot and Docs soon.

    -Vivek

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