Huge Profits: Will Drop Ads by 31% Options

[rustybrick]

Gary Price sums it up well at http://blog.searchenginewatch.com/blog/050428-104538

Basically, AJ reported 18.1 million and "Revenue more than doubled to $94.9 million from $39.2 million in the year- earlier period."

Great news for AJ, but their stock is down!

Anyway, Gary also reports the CEO saying:

Berkowitz said that, in a bid to improve the user experience with the search engine, the company began to implement a program in early April to reduce by 31% the number of ads it shows at the top of its results pages. The company's tests show that a smaller number of ads boosts the frequency with which people use the site and aids user retention. As such, Jeeves expects the change to help lift query volumes and ad revenue later in the year.

Good news, IMO.

But note, that currently the Google ads bring in 70% of Ask Jeeves's revenue.

[whitemark]

...  in a bid to improve the user experience with the search engine ...

" ... in a bid to get back the searchers disappointed by our 10-20 ads which mimic search results ... " is much nearer to the truth.

The increase in revenue is not at all surprising. Ask Jeeves very deceptively places Google Ads just below a 'box' of Google Ads, thus fooling the searchers into believing that those are the relevant search results.

Here's an example search - web hosting. Notice how the 'Sponsored Web Results' label is just below the 'box' of 'sponsored content' thus leading searchers to believe that the label is for the 'box'?

Anybody will easily mistake the ads for the search results, the first time round. Isn't it a disservice to the advertisers too?

... implement a program in early April to reduce by 31% the number of ads it shows at the top of its results ...

Sounds Good until you realise that some searchs (like 'web hosting') show 10 Google ads (not counting those in the 'box'). So 30% less means they'll still be showing 7 Ads! Wow, what a great favor!

Teoma (the engine powering Ask) is one of the best search engines next to Google. Pity they are in the hands of someone who have no creativity.

[rustybrick]

I would beg to differ. I believe that Ask Jeeves is one of the most creative search companies out there. In fact, I feel they are the reason for so much innovation in the market.

You have to take a look at the whole company.

On one hand you have those who sit in the R&D department, knocking out creative solutions to better answer your questions. These guys understand the power of their search technology (teoma) and (IMO) are as frustrated as you are (probably more) that these Google Ads come up above the pure organic results.

On the other hand, Ask is a public company. 70% of their revenue came from Google AdWords. To simply drop off 90% of the ads would be devasting. This is a major step. 31% is huge, in terms of the risk they are taking. Ask is a much smaller company then Yahoo! and Google and now MSN. This risk, of reducing the ads by 31%, can be huge, but it is a big risk.

[whitemark]

Like I said too, Teoma is an excellent search engine. No dispute there. The people who own it unfortunately lack creativity.

... Ask is a public company. 70% of their revenue came from Google AdWords. To simply drop off 90% of the ads would be devasting. This is a major step. 31% is huge, in terms of the risk they are taking.

Realistically nobody expects them to drop all ads from their sites. But let's also look at the 'risk' they are taking.

The real problem with Ask Jeeves is not that they fill it with so much ad. The root problem is that they just don't make any real effort to differentiate between the ads and their search result. And that is why even a 30% reduction in ad won't make much difference to their revenue stream.

I am 100% sure that while searching for competitive (commercial) terms the majority of ask jeeves searcher click the ads without realising they are ads. So even if they show 7 ads instead of 10, they will still be above the fold of the page (and hence mimic organic results), there is not going to be any realistic change in revenue - unaware searchers will continue to click on the ads first.

Instead of reducing their number of ads why don't they just throw all their ads to the left like Google? Why do they make only superficial efforts to differentiate between their ads and their search results?

All Ask has to do is realise that Teoma is a very potential 'disruptive technology' and just show some creativity to win the search engine race.

[whitemark]

Barry, I thought you might find this interesting: Does Jeeves Ask for Permission. If it's true, it's another example of how Ask Jeeves is axing itself in the leg for short term gains.

[rustybrick]

I can try to get a response to that article. I have seen this before...

[bragadocchio]

Ben's article, and the series that it is part of is an excellent one.


It's probably worth pointing to this blog post on that subject, too:

The Internet Danger List: stocks at risk from Spitzer's attack on Adware

Frankly, as someone who has had to remove Myway and Mysearch toolbars from people's computers when those computers were too spyware infested to work anymore, I'm not a member of their fanclub. Ask Jeeves would be better off not using that technology than defending its use, the way they seem to be.

There are some valid criticism of Ask and their advertising in this Consumer Web Watch report from last November:

http://www.consumerwebwatch.org/dynamic/se...re-abstract.cfm

I'll add that I'm not really fond of the inclusion of "Sponsored Web Results" after the "Web Results," and think that they are presented in a way that could get people to very easily confuse them with regular results.

I'll agree with Whitemark's assessment of Teoma. It is a superior search technology. But I don't use Ask that much for my search purposes. I really don't want to have to watch that carefully to see whether I'm clicking on something that the search engine determined was relevant, or something that someone paid to have put on that page.

[whitemark]

I can try to get a response to that article.

Can you please find out more? It sure would be interesting to hear their side of the story.

I'll agree with Whitemark's assessment of Teoma. It is a superior search technology.

The thing is Bill, I've been having doubts about this after this thread made me think harder - is it really true that Teoma is a better search technology than Google, Yahoo or MSN? Yes, if I do a search comparison, Teoma often gives more relevant results than Yahoo or MSN. But under what context are we comparing this relevance?

Say if we take the index size into consideration too - Google, Yahoo and MSN all have a larger index than Teoma.

Index Size

Google    - 8.1 billion
MSN        - 5.0 billion
Yahoo      - 4.2 billion (estimate)
Ask         - 2.5 billion

[Source: Search Engine Size WAR V Erupts]

The fact Google can still serve mostly relevant results with such a huge index is indeed mind-boggling, and most definitely the area where Yahoo and MSN are still struggling. Can Teoma's relevant results be said to be an 'amazing technology' under this context?

If so, I can attest that the Yahoo directory or DMOZ (with a better search script) is a better search engine than Teoma because it too can give me really quality results. Maybe because of it's subject-specific popularity focus, all Teoma really is (perhaps) an automated DMOZ?

Leave aside the debate whether bigger is really better, one other thing is the poor multi-language support of Teoma compared to Google, Yahoo or MSN.

Under all these contexts I wonder how scalable Teoma really is as a search technology?

[rustybrick]

I have emailed Ask asking for more info, I'll let you know as soon as I hear more.

[rustybrick]

My contact is away at the moment, but here is a pretty good response. http://blog.searchenginewatch.com/blog/050502-234723

[whitemark]

Thanks Barry. Now I understand Ben's comment better -

If Ask Jeeves staff made a serious effort to screen and supervise their distribution partners, they could prevent this kind of mess.

I wasn't aware that Ask Jeeves had hired(?) someone to distribute their product. This reminds me of a similar episode with iPowerWeb hosting ads appearing through many adware pop-ups. They were blamed and got a bad rep because of their affiliates shady methods.