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SearchChat Podcast: Google Is Evil

Google’s business model was built on a symbiotic relationship between companies who want their content to be seen, and Google rewarding them for quality content. To be fair, this was so Google could sell ads, but it worked out well for mostly all parties involved. 

That’s broken down. 

Most companies are still getting the plurality of their traffic from organic and paid search, but the social contract has been run over by a truck. Google has added increased ads, along with the knowledge box and other built-in features that push organic results down below the fold.

The Wall Street Journal recently claimed Google interferes with search algorithms and changes results. Others in Search Engine Land claimed it’s more complicated than that — where Google does interfere, it has good reason. Regardless of who is exactly correct, it’s clear marketers are paying the price.

In this SearchChat Episode Tim Peter and Steve Zakur finally acknowledge that Google is not just a monopoly, but plain evil. We depend on Google, and rates are going up. How do we respond?

0:00 Intro

1:55 Search engine monopolies

10:00 How much traffic isn’t Google sending?

14:55 Rates will increase — what do we do?

23:10 How B2B companies can leapfrog to better personalization

30:20 Outro

SearchChat is available on

Search Chat is SoloSegment’s podcast dedicated to all things search AI and content marketing related. Who is SoloSegment? We’re a technology company focused on site search analytics and AI driven content discovery to improve search results, increase customer satisfaction and unlock revenue for your company. If you think we might have the answer to your conversion problems, feel free to connect with us.

Transcript

Tim Peter: Hi, I’m Tim Peter, and welcome to SearchChat, SoloSegment’s podcast, dedicated to all things search, AI, and content marketing related. Who is SoloSegment? Well, we’re a technology company focused on site search analytics and AI-driven content discovery, to improve search results, increase customer satisfaction, and unlock revenue for your company. SoloSegment, make your search smarter. You can learn more at solosegment.com.

Tim Peter: On this episode of SearchChat, SoloSegment’s CEO, Steve Zakur, and I discuss a recent Wall Street Journal article about Google’s dominance in the search market. We also discuss how you can put search to work more effectively for your business and make Google less relevant. All that and more on the latest SoloSegment SearchChat, coming at you, right about now.

Tim Peter: Good evening Steve, how are you doing today?

Steve Zakur: I’m doing well, Tim. Thanks for accommodating the big changes in schedule. It’s good to be talking again.

Tim Peter: Likewise. Yeah, it’s been a while. We had an episode with Mark Schaefer, which was great and I’ll put a link to in the show notes. Everyone should check that out. But it’s been a fair bit since the last time you and I talked.

Steve Zakur: Yeah, it feels like forever we sat at a microphone and talked like this, as opposed to sitting in a room talking, but okay.

Tim Peter: Right. Exactly. I haven’t talked to you twice today, but I haven’t talked to you on a microphone in what feels like a while. But nonetheless. What do you want to talk about today, Steve?

Steve Zakur: You know how much I love search engine monopolies, so maybe, I mean, lot going on these days with regards to search, especially that Wall Street Journal article was interesting.

Tim Peter: Interesting, yeah, that’s a great choice of words. Why do you say interesting Steve, as opposed to really phenomenal article or oh my gosh, these people are so smart and know a lot about this stuff?

Steve Zakur: Yeah. Well it’s funny, in a previous life I did some writing about a hobby of mine and I always felt a bit like a pretender because sometimes it forced me to become knowledgeable about something in a very short period of time.

Tim Peter: Oh yeah, sure.

Steve Zakur: And I always felt like I wasn’t quite the expert that I might’ve sounded like, but I learned enough of the buzzwords so that I could to be credible. And I feel like that’s the depth of journalism with regards to this Wall Street Journal article that was recently published. And certainly we’re not going to take them to task on all the facts they got wrong, which was pretty much all of them.

Tim Peter: Right. Actually there’s a couple of good articles which we will link to in the show notes, that did a really nice job. I’m sure actually, a couple, I’m sure there were a billion. There are two that we particularly liked.

Steve Zakur: Sure. Well anybody who wants to rank for SEO content and demonstrate brilliance, certainly took them to task.

Tim Peter: That’s right, that’s right.

Steve Zakur: What is interesting about that, and you and I have talked about this a fair amount, it’s one of our primary theses in the marketplace, which is that, maybe Google is evil is a bit strong, but I mean Google is going to pursue their goals of dominance in ad revenues and the best way for them to do that is to become a gatekeeper to content.

Tim Peter: Right, that may not be evil, but they’re certainly acting very much in the best interest of their shareholders, which isn’t necessarily acting in the best interest of all their associated stakeholders. Right?

Steve Zakur: Yeah, absolutely. And it is interesting that their business model of course, was originally built on access to content, to serve ads, that’s always the subtext. But there always seemed to be this partnership between content producers and that is to say companies who wanted traffic and Google because there was this symbiotic relationship and companies tried to get the algorithm to treat them nicely by creating great content and Google rewarded them. And it seems like that compact has broken down, I think. Companies still pursue their goals, for better rankings. Mostly I think out of a Pavlovian response.

Tim Peter: Well and if I can say, most companies are still getting the plurality, if not the majority of the traffic, from Google, particularly organic and then when you added and paid for those folks who are doing paid, it almost always kicks them into the majority of their traffic from those two. Though I completely agree with your premise, that the social contract has been run over by a truck lately.

Steve Zakur: Yeah. And it’s interesting, earlier this year I spent a lot of time talking to digital marketers about what’s top of mind. And there was a lot of language around customer experience, personalization, engagement and those sorts of things. And a lot of people struggled to know why that was important to them, other than those all sound like good things. And I think what they were sensing is actually something that we found as we looked at the data and anybody can find this, we just happened to go looking for it. But coming back again to Google’s business model, when you look at their revenue, it’s something like 85, 87% ads, about 13% or so is the G Suite and everything else that they do.

Tim Peter: Yeah, yeah. Actually it’s the Q3. Actually, it’s funny, I just pulled these numbers the other day. At Q3, it was only 84%.

Steve Zakur: We’re making progress. So 84%.

Tim Peter: Yeah. That’s all of alphabet’s earnings. Everything they do is 16% rather.

Steve Zakur: Yeah. And by the way, just the finance geek in me, I love what they call, they have advertising, they have this other stuff and then they have another third category, which they call other bets. So that must be pure R and D or whatever it is. That amuses me.

Tim Peter: Well, and the other bets, if I recall correctly, and I shouldn’t say a number here, I won’t say a number here, I will say more of a directional. But the other bets, if I recall correctly, were underwater completely. So advertising 84% of their revenue, but it’s more than that because some of the things they have, don’t make any money at all.

Steve Zakur: Sure. Oh yeah, absolutely. But there’s two other interesting data points that they present in the management discussion and analysis portion of their 10 Q. And that is the percentage growth in clicks and the percentage growth in essentially revenue, or the rates that they charge for those clicks. And they do this for paid and I think they do for organic as well. But the paid ones are really interesting because of course that’s where the revenue comes from. And what’s fascinating is, and I think you’ve said this in the past, I’ve certainly heard you say it, maybe not on the podcast, but everybody who’s going to be on the internet is kind of on the internet these days. Now there’ll be growth, certainly as some countries become deeper penetration, but most of the growth has already occurred.

Steve Zakur: And you see that in the volume numbers that Google presents for clicks on paid ads. It’s beginning to level off. The growth rate used to be 50, 60 some odd percent, now it’s 18. And by the way, it’s been on that downward slope for a long time. And the flip side is if your volume is decreasing and you have to demonstrate growth and you have no other products, well, you’ve got to charge more.

Tim Peter: Really?

Steve Zakur: Yeah, I know, it’s fascinating how that math works. So Google has been doing just that. And what’s interesting is you see now rates going in the other direction. And it looks like if you follow the trends, fourth quarter, maybe the first quarter, next year at latest, but the fourth quarter of this year, you will see rates increase for the first time ever, for Google paid search.

Steve Zakur: And so that’s, I think, the big story that is out there in the environment that people really haven’t researched, but that they’re going to feel and it explains so much of what Google is doing. Whether it’s pushing down organic results, keeping the clicks for themselves, all those things are in service of making sure that these revenue numbers continue to increase so they can please the streets, so they can please their shareholders, but it’s going to squeeze the B2B marketers, the B2C marketers, any marketers that are doing paid are going to get squeezed in the middle. And I think that’s the wake up call for maybe these yield engagement, customer experience things, are more important because of that context.

Tim Peter: Right. Well and Steve, I’m going to put you on the spot because I know you talk about these numbers a lot, but can you talk for just a second about the numbers themselves, in terms of, how much traffic a Google isn’t sending, the decline we’re seeing in organic, things like that. The amount of zero click searches, things like that.

Steve Zakur: Sure. Yeah. So Rand Fishkin, SparkToro is his new company. They publish these numbers in partnership with another company whose name escapes me right now. These are Rand’s numbers, but they’re very credible in the market, they’ve survived a lot of scrutiny. And what they’re doing is they’re looking at basically trends and Rand’s game really is SEO. So we’re looking for what are the meaningful trends in that top of funnel acquisition space. And his big concern is, he was one of the early ones to say, “Hey, wait a minute. Google is the only search engine.” And I know Bing and a bunch of others are going to take that umbrage to that statement, I guess is the best way to put it. But when you look at the data, the top four Google properties, it’s Google Search, Image Search, YouTube and another one I’m forgetting, Instagram maybe?

Tim Peter: No, no. Google search. Oh gosh, I should know this off the top of my head.

Steve Zakur: What’s the fourth one?

Tim Peter: Oh my gosh.

Steve Zakur: Google Search, Image Search, YouTube and … all right, so we’ll look it up and we’ll put it in the show notes.

Tim Peter: Exactly, we’ll fix this in the editing.

Steve Zakur: That’s right. When you look at those four things, it’s all of search. And then he breaks down the little sliver that’s not, into more slivers and then the little sliver that’s not, into more. And when you look at things like social search, Facebook, Twitter, it’s zero. When you look at any other search engine, it’s essentially zero. And so again, so very reliable numbers. And he was the first one to call out, Google is the game. And if Google is the game, well let’s really look at, well how is that game evolving for marketers? And it’s very interesting and they break this out.

Steve Zakur: And by the way, all this data that Rand puts out is free, he publishes every presentation he ever does. So you can Google him. We’ll try to find the most recent one and put those in the show notes as well. And he breaks this out by desktop and mobile, so there’s all sorts of different cuts of this data. But when you look at it, organic search clicks are declining. And so the big question is, well, wait a minute, why? Why would clicks in organic be declining? Maybe it’s because Google puts more ads at the top, and that’s certainly been true. Ads used to be tiny and then there were more of them and now they’re bigger. Okay, so organic gets pushed down by that and that makes Google’s revenue opportunities greater.

Steve Zakur: But the other way I think Google continues to own and dominate the space, is that any keyword that’s even remotely common, is now going to have all sorts of, and we see this, you do a search on something and you see all sorts of stuff. You see a little sidebar box off to the right, is a Wikipedia entry, and then you see an answer box and then you see other questions. And there’s all sorts of different content elements that Google is putting on the search engine results page.

Steve Zakur: And their intent there is certainly to answer questions for the person who’s searching. Good for them, they get a quick answer. But what it does very often is it robs the content owner, the person who provided that content, with the click through to their website. And so if you want to know why overall organic search clicks are down 20%, that’s why. And so Google is keeping the clicks and it’s stunning, the percentage that they’re keeping. There’s more recent data than this, but the June data was 49%. And when you split that to mobile, mobile is significantly higher than that. So desktops a little better than the 50% or the 49% but mobile, nobody’s clicking on mobile.

Tim Peter: And the number that I always throw out there is the fact that 100% of the growth, actually greater than 100% of all the growth in search volume, is occurring on mobile. Desktop search peaked, in terms of search volumes, in 2014 and has been in decline for the last five years. Has held stable, or declined for each of the last five years. So literally mobile, even if it’s only … for a lot of our B2B clients and things like that, mobile is still relatively small, it’s 20% but it has grown from 0% two years ago. So the growth curve is astonishing. Right?

Steve Zakur: Yeah, yeah, absolutely. And so, given that reality, so now we’re in a reality where we know Google’s got to grow their revenue, they only have one product. They’re taking active measures to keep organic on their site. They’re taking active measures to make ads more visible. And marketers are faced with, at some point, it’s got to be more expensive. Rates are going to increase. What’s the response? And that’s the question we hear, is, “All right, well Steve, thanks for borrowing Rand’s alarm bell and ringing it, but what’s left for us to do? How do we respond?” And I think some of it, and this is going to sound a little trite, is you got to keep doing all that stuff you’ve done so far really well.

Steve Zakur: You got to keep doing SEO really well and you have to probably keep buying what you’ve been buying, if for no other reason, that at this point Google’s essentially a monopoly and until they’re not, you’re going to want that, as you said earlier, 50, 60, 70% of your traffic’s coming from there, you’re going to want to continue to get that. And by the way, there was some other things you and I have chatted about this that you could do defensively, which is, focus on your long tail because there you’re likely not going to be competing with ads. So your long tail, like less common keywords. You’re not going to be competing with ads.

Tim Peter: Well you’re not going to be competing with ads for now anyway. Right?

Steve Zakur: Well at least for now. And also you’re likely not going to be competing with all those boxes that appear. So you see those less frequently in the long tail. So I think that’s part of the game, but you definitely have to do everything you’ve always done well and you have to perhaps get some leverage in the long tail, where you have some opportunity. But of course your problem with the long tail is you don’t have a lot of content that’s really focused on journey progression and all that stuff in long tail because they’re your less popular topics, I guess is the best way to think about it.

Tim Peter: Well they’re going to be lower volume, they’re going to be a lot of things. I mean, we obviously, when we do client engagements, we talk a lot about long tail and you try to make up with volume of keywords, what you lose in volume of traffic for any given keyword or group of keywords. But that’s work. It’s literal work. It’s not an easy thing.

Steve Zakur: And it’s a lot of diminishing returns there in the long tail.

Tim Peter: Can be. Yeah. Yeah.

Steve Zakur: Of course, you could build your email list. So you could not go to Google at all, but we all know how hard that is. It’s virtually impossible to get anybody to give you their information, that information ages out really quickly. And oh, by the way, if your organization or your, if the subscribers organization or they personally use Gmail, guess what? Oh Google is shunting all those ads off to a separate tab, so they basically never see them and nobody opens them, yada, yada, yada. So email is hard.

Tim Peter: And not that we’re saying people shouldn’t do it, we’re just-

Steve Zakur: I mean again, you got to do it, it’s worth that. There’s no easy answers here. And the other unsatisfying option is, make sure you’re a destination for your subjects, so that when people think about … I’d love it if people, the synonym for personalization was SoloSegment. They just typed our URL in whenever they thought about it, but it’s not. And so that’s a heavy lift as well.

Tim Peter: Well, it’s amazing, and this is going to be less true in B2B, but we’ve seen this a lot in B2C over the years. You look at the number of companies who compete in that space, who have invested heavily for the first time in years, who’ve amped up their spend on television and radio and outdoor and the like. Think about the fact that you’re seeing television commercials for Amazon, a lot these days, that’s very much what they’re trying to do, is they’re trying to be the destination that people think of.

Tim Peter: Obviously if you’re B2B a company, there are certainly companies where you can do that, but the avenues by which you’re going to reach the right kind of folks, there are a ton of them. So that’s hard in a different way. You should still do it if it’s appropriate, but not the simplest thing in the world to do.

Steve Zakur: Yeah. So I guess the long story short of that is, acquisition remains hard, Google is going to make part of that harder or maybe even more costly. And so that brings me back to the market thesis that we’ve been grinding on for about a year now, which is yield is where it’s at. That engagement, that progression, that positive customer experience that keeps … whatever you do get, improves the yield on that, so you’re getting at least bigger bang for the buck, is where the game is. And oh by the way, that’s not easy either.

Steve Zakur: But you look at some of the tools and I can make a shameless plug for our technology as well, but there are tools that are emerging that make it easier. And some of the concepts are certainly borrowed from the B2C worlds. Things like, we do content recommendation, that is something that is going to help B2B marketers improve engagement. Certainly all the basic blocking and tackling of UI and UX and making sure you really are good at that and you measure it and you evaluate it and you revise it, are important. But it really is that engagement. And as you and I have talked about a lot, personalization is the key, it’s the expectation that people bring from their B2C lives.

Steve Zakur: And that is the game. And that’s where we’re focused is, how do you deliver these personalized experiences, in the context and headwind of GDPR and ITP and all those other things that are happening. Which is another blog post, one that we’ve probably already done or podcast. But that is how do you deliver personalized experiences that create that engaging interaction, that engaging context, so that people know, oh, this is how I get to my objective. And that I think again, it’s almost like one of these obvious observations, but yield is where I think the game is shifting. And that’s why people have been talking about customer experience, sometimes, I don’t think they knew why they were talking about it, other than it was a cool buzzword. But I think the context for customer experience being really, really important, is because the top of funnel is going to get harder and we see that in the data.

Tim Peter: Right. So Steve, you teed up this question nicely. How do you do that? How do you personalize, especially in, well let’s stay away from the GDPR and ITP for the moment. But just in terms of, what are some steps people can do in addition to give us a call with SoloSegment?

Steve Zakur: Yeah, sure. You bet. 1-800 SoloSegment. No, don’t dial that, I have no idea what that is.

Tim Peter: Like the old day of telling people to go to whitehouse.com and if you don’t know what that is, don’t Google it.

Steve Zakur: Don’t go there.

Tim Peter: Please. Anyway, sorry, go ahead.

Steve Zakur: Sure. So this has clearly gone off the rails. So I was actually talking to someone today and we were talking almost about that exact question. So very prussian of you to tee that up. And I liken this to, it’s 20 years ago in India, and landline phone penetration is very low, as compared to rest of world. And what you saw happen over the next 10 to 15 years was landline penetration did not increase. What went crazy was cell phones. Because it’s far easier to put up a tower with an antenna on it, it makes a lot of sense. And so it’s this leapfrog notion.

Steve Zakur: And so especially in B2B and it varies by industry segment, almost by company to company. But B2B generally is less mature. B2B companies are generally less mature than B2C companies, with regards to personalization technologies. And the question I was asked was, “Well what should our next step be? Should I go look at how to bring in personal information and do some third party data?” I said, “Well why would you adopt the technology that, A, was developed 20 years ago?” Not modern technology. B, relies upon data that not only do regulators or regulators are squeamish about, but it’s actually not the regulators who are actually squeamish, the reason the regulators are squeamish is because the human beings are squeamish. So why would you build your business on landline telephones. Why don’t you take a step forward and do something a little more interesting.

Steve Zakur: To use the data you may already be able to gather, things about your content, things about your visitor journeys, things about your searcher intent. And I mean there’s a lot of data that is available within your firewall, within your website. And so can you use advanced technologies to discern what a customer, what a visitor, that first click they make onto your website, what they’re trying to achieve and nudge them along through a journey towards a task, towards their objective, towards the thing that’s going to add value for your company.

Steve Zakur: And so this is the shameless plug portion of the podcast, where, that’s been from a product perspective where we’ve been at is, how do you do this so that you can leapfrog all those technologies that require third party data or really robust first party data or whatever. And how do you then leapfrog those in a way that allows you to use latest technology, to serve the same ends, make it easier for you, make it easier for your customer and deliver that personalized experience. And so that’s where we’ve been focused. And I think that’s where companies need, and we’re not the only vendor who does this, there are a lot of vendors out there who are thinking about this. And that’s where I think people need to think.

Steve Zakur: So it’s not, let me figure out what … I’m not going to go take a look at what, say, Brooks Brothers is using to for their personalization technology and then try to apply it to, pick some large chemical company. Leapfrog that. Leapfrog the B2C model and look for, what is the model that makes sense in your context. And that’s especially important because the characteristics of a B2B context are often very different from the B2C one. Not only that the business models are different, et cetera, but B2C personalization is easy. And it’s easy because especially the content data is so well structured that, Hey, I know that Tim likes green jackets in this size, et cetera. So therefore I can go to my catalog and deliver him recommendations for green jackets in this size. So that’s easy.

Tim Peter: And they tend to sell products at much larger scale. I mean there are absolutely exceptions. If you are in the, I’m going to make a specific example, you make gears or motors for conveyor belts or for plants or logistics or things like that, well sure, you make a lot of those. But I mean generally speaking, most large B2B firms, the volumes of products they sell, just by nature of what they are and the cost and the number of companies who need them, it’s going to be a smaller dataset, right?

Steve Zakur: Yeah. You bet. And the thing that you’re recommending is not a product, because as you said, you’re not saying, “Well buy the jet engine.” What you’re saying is, “Here’s the white paper.” So you sign a piece of content, because B2B conversions is a process of lots of different types of conversions. And when you’re selling and recommending the content, you’re recommending a big wad of unstructured data. So how do you know that that unstructured piece of data, fits the context of the information that the person is seeking? And today you could hand code all your content or you could use say, natural language processing and machine learning to both discern the meaning and then label the content with a meaning. So that’s why I think B2B companies in particular, with big gobs of unstructured data, have to be thinking about leapfrog. Because the technology from yesterday is not only going to be unappealing because of all the personal information ramifications, but I also don’t think it serves the context of their visitors very well.

Tim Peter: That’s awesome. I mean, yeah, that’s great. And I mean it’s interesting, if I can add one thing to this because I’m so glad to hear you say this. It’s a thing that people forget in digital, is the leapfrogging. And the India example is a great. When we used to talk about this, oh my gosh, 15 years ago, with regard to, when I first started doing digital stuff globally for my company, that probably 18 years ago, we always talked about, when you talked about the internet, the US was in the current year, I’m just going to say 2002. And as you worked your way East, towards Europe and then towards, Asia and the like, it was like you were going back in time.

Steve Zakur: How interesting.

Tim Peter: And when you talked about mobile, it was entirely flipped. Japan, Korea, places like that, were really good at mobile. And as you work your way West, you got to the US, nobody was using mobile. But what happened in both cases is they leapfrogged the technologies. You don’t have to start where people started, just start right where people are now. If in fact you look at companies who come in and disrupt, the reason they’re able to disrupt is because they don’t have that legacy baggage that they have to replace or things like that. It’s really a great point. I’m so thrilled you brought that up.

Steve Zakur: Yeah, yeah, no. I mean if we were to net this all out, you have a threat. You have a threat, that top of funnel, your acquisition is going to get harder and harder. The response is that you have to really focus on yield because of the monopolistic tendencies of the players in that space. And I think your point is exactly right. Start where the state of the technology is today and start with the state of technology that makes sense in the context of your visitors, especially if you’re a B2B company and not where the product and the technology frameworks that were, are quite frankly, yesterday’s news.

Tim Peter: It’s a great way to put a button on it, Steve.

Steve Zakur: Look at that.

Tim Peter: Look at that and we’re right at time. Any last thoughts before I let you go?

Steve Zakur: Boy, if I have any more thoughts I might bore the audience, so we’ll call it there.

Tim Peter: Fantastic. Well, as ever, great chatting with you. I’ll look forward to doing it again in just a couple of days.

Steve Zakur: You bet. Take care.

Tim Peter: SearchChat, is brought to you by SoloSegment. SoloSegment is a technology company focused on site search analytics and AI driven content discovery, to improve search results, increase customer satisfaction and unlock revenue for your company. SoloSegment, make your search smarter and learn more at solosegment.com. If you like what you’ve heard today, click on the subscribe links you can find at solosegment.com/podcast, on iTunes, Google Podcasts, Stitcher Radio, Spotify, or wherever fine podcasts can be found. You can also find us on LinkedIn at linkedin.com/company.solosegment. On Facebook at facebook.com/solosegment. On Twitter using the Twitter handle @solosegment. Or you can drop us an email at info@solosegment.com. Again, that’s info@solosegment.com.

Tim Peter: For SearchChat, I’m Tim Peter. I hope you have a great rest of the week. Thanks so much for joining us and we’ll look forward to chatting with you next time here on SearchChat. Until then, take care everybody.

Author

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    Tim Peter is the Senior Advisor at SoloSegment. An expert in e-commerce and digital marketing strategy, web development, search marketing, and analytics, Tim focuses on the growth of the social, local, mobile web and its impact on both consumer behavior and business results. SoloSegment uses machine learning and natural language processing to improve engagement and conversion for large enterprise, B2B companies.

  • Steve Zakur

    Stephen Zakur is CEO of SoloSegment. SoloSegment uses machine learning and natural language processing to improve engagement and conversion for large enterprise, B2B companies. Prior to joining SoloSegment, Steve held a variety of executive positions at IBM focused on marketing, technology, and sales. Steve holds an MBA from the Stern School at New York University.