Stuck In Google's Doghouse

hansoloaf writes "The NY Times is running an article about a business, Sourcetool.com that seem to be in a sort of a doghouse with Google. Initially Sourcetool uses AdWords to help build up its business. The business centers around providing links for business that sell industrial products. The owner, Dan Savage, explains in detail how Google over time used its AdWords bidding system to limit or reduce Sourcetool's ranking and revenue because the site's landing page is not 'googly' enough. Savage wrote a letter to the Justice Department as they are reportedly looking into Google and Yahoo's proposed deal." The article is nuanced in its observations about the complexity and ambiguity of anti-trust law. Even if Sourcetool and similar businesses aren't "Googly" — which is a Google proxy for "what the customer wants to see in search results" — should Google be able to pick winners and losers among industries and business models?

Comments

Why not just improve the site?

[Naughty Bob]

The Dan Savage? Love your work.

But surely google must serve its customers in the way it deems best. Otherwise, who is running the business?

Solution? Make your website less like a link-farm. Perhaps add some value, like trustable reviews, or customer recommendations (otherwise, the site is not really any different to a Google search on the term "Industrial Products").

"Googly" -- which is a Google proxy for "what the customer wants to see in search results"

Which is, of course, why Google is the No.1 search engine. They make serving their customers their business, the crazy loons.

Re:Why not just improve the site?

[adisakp]

His website relied on being a link-farm.

From The Summary: The business centers around providing links for business that sell industrial products.

The summary is wrong it should say "AdSense Links".

Basically, he was skimming from Google. He was paying google less for search terms than Google was paying him for click throughs. If you typed "ball bearings" on Google you might get one of his adwords (that he paid 5-6 cents for), then clicked on one of his "ball bearing" you'd be clicking on a Google AdSense ad (that he was paid 10cents per click through). He was making a huge amount of money by making people click twice through what Google would prefer to be a single click from their system. Plus his entire business model relied on skimming cash from Google.

Re:Why not just improve the site?

[Naughty Bob]

Yes, except you've forgotten a critical point... Companies who advertise and pay them money are their customers, not the masses who use their services for free.

I didn't forget this- It isn't a critical point though-

How would Google be serving its customers by filling up the search results with link farms? In my eyes, that only devalues the product.

This site, as a poster above points out, is simply skimming cash from Google.

Re:Why not just improve the site?

[Anonymous Coward]

They are the customers, but nevertheless it may be a good business decision to get rid of bad customers.
If some customers are given cheap ads to irrelevant pages, the free users (Google's product) will start clicking on the links less, and thus reduce the value of Google's services their other customers.

Since this is Slashdot, every post needs a bad analogy. This case is similar to a restaurant throwing out a paying customer (or charging them *a lot*) if they are loud, annoying and disturbing many other eaters.

Re:Why not just improve the site?

[adisakp]

The site still looks like a link farm. And every page basically has paid links on it that just repeat the search terms he was paying Google to buy. There's no reason Google should sell him search terms cheaper than they pay him for click throughs on the same search terms.

Not so simple once you really think about it

[willyhill]

At first I thought this was going to be yet another "SearchKing"-like whine with cheese about how unfair Google was being to some sleazy parked domain hoarder. But that's not quite the case. Make sure you RTFA. I think the guy's website is relatively useful and well-organized. It sure doesn't feel like the usual AdWord gaming scheme.

I get the sense that Google is being hoisted by its own petard here. The fact that the article mentions the site in question might be in direct competition with one of Google's main partners is definitely interesting, coupled with the allegation that he knew of at least one other website who got a pass from the algorithm after being evaluated by a human being.

Here's an example. I searched for wood cutting on Sourcetool. That's a pretty relevant list of results if you're a business looking for that kind of equipment. Now run the same search directly into Google. See the problem? Yeah, the 5th hit is a Runescape page, for cryin' out loud. I'm sure I could possibly refine the search, but think about the ads that show up on the right side of the page. A link to Sourcetool and five seconds later I'm looking at what I actually needed.

Maybe Google is nervous about niche search solutions? I'm just not seeing their problem here.

If the article is correct, Google is not acting on good faith. To all the people who screamed about how Google is not a monpoly and made Microsoft jokes when Slashdot ran the Yahoo deal antitrust investigation, remember that Google does have more than 70% of the online ad market, and then put yourself in this guy's position. What are your options? MSN ads? You're screwed, because you can't take your business elsewhere.

And I have to say I was astounded at the money amounts mentioned... $600K per month? I'm definitely in the wrong business!

Re:Not so simple once you really think about it

[jonbryce]

When I go to a search engine and ask it to find me something, I don't want to be taken to another search engine that might find me what I want. I want it to find me what I want.

Re:Not so simple once you really think about it

[Anonymous Coward]

I liked the article a lot too, and it's certainly true that someone who is operating a search business is in a tricky position. As I read it he grossed $650K monthly on click revenue, and paid Google $500K a month for keywords.

How much value is the site providing in between clicks? I searched it in a couple areas where I've had to find and buy materials or equipment. I would say not real useful, and far from complete. If you're seriously sourcing stuff for a business, you soon learn who the main manufacturers and distributors are, and if you google, you don't google for a broad category, but for a part number or the narrowest possible technical descriptor. Maybe if you're just starting out and with no idea who sells widget-grinders this would give you some initial places to look.

Other readers will be savvier on this, but the site really looks like it was generated by software with minimal human intervention. I certainly get no sense that experts in particular areas had any hand in making the categories. The guy's business model depends on being widely spread across a whole lot of categories, which pretty much precludes paying for the in-depth expertise that would make it really helpful.

A right to revenue?

[BadAnalogyGuy]

Does a company have a right to revenue? If they base their business model on the rules of another company, do they really have recourse when the rules are changed to damage that revenue stream?

And can anyone point me to a bit torrent of an actual Miley Cyrus CD instead of garbage binaries?

Re:A right to revenue?

[Just Some Guy]

And can anyone point me to a bit torrent of an actual Miley Cyrus CD instead of garbage binaries?

As the parent of a pre-teen girl who has said CD, let me assure you that you're drawing a distinction that does not exist.