Blame Google For MySpace's Advertising Problems

Michael Learmonth | July 3, 2008 3:40 PM

murdoch-and-tom.jpgGoogle (GOOG) isn't shy about telling everyone what a bad deal its $900 million search pact with MySpace (NWS) turned out to be. The company basically laid its Q4 earnings miss on the deal, claiming social network inventory "is not monetizing as well as expected."

But what if Google, and not MySpace, is the problem? Pali Research media guru Rich Greenfield thinks MySpace is doing just fine selling ads ($500 million excluding the Google deal in FY 2008) but Google isn't doing such a good job on search, and thus is not delivering the right ads to MySpace users.

How does Rich figure? He tried a few basic searches on MySpace and got incredibly irrelevant ads served through Google's AdSense -- ads that would never result in a click, or in a payment to MySpace or Google. Rich tried a search for "Dan" and got ads for DNA testing. We gave it a try: A search for "Mike" got ads for Nike's Summer Sale.

No surprise to Rich, then, that MySpace's search monetization is weak. Will Google walk when its current search deal with MySpace expires? No. More likely: they'll realize they're at least part of the problem and work to get their social network search algorithms right. Then they can start minting money from MySpace's 120 million global users.

See Also:
Madison Avenue: Still Trying To Figure Out Social Networks
Google Stuck With MySpace Deal--MySpace
Google: MySpace Deal Hurting Us

Subscribe to SAI: RSS, email newsletter (no spam)

More:

Share:
Post to Del.icio.us


< Prev. Story
Next Story >

22 Comments

Tim said:
It's a little unfair to throw rocks at crappy ads on unmonetizable queries; sure, those ads sucks, but what ad would be relevant to this query? It would be more informative to try some queries which might support good ads.
Lex Davidson (URL) said:
Michael, I usually agree with your viewpoints, however I'm taking a different perspective on this. The examples you listed as search queries will never work on a contextual basis. What type of sponsored link would have enabled a higher click through rate when you typed in the word Mike? In order to get higher eCPM's, Google will have to address the "intent" of the user as opposed to the contextual nature of the search. For example, placing dating ads when a user is looking for friends, or companies such as Reunion.com, would probably get a higher click through rate and thus a higher rate of revenue per query.
Agreed, but surely Google can do a better job than matching letters in a name search. How about a stab at what I'm interested in? Surely since I'm on MySpace Google has some idea from my profile, surfing history, right?
Tim and Lex: Those are challenges Google will have to deal with. What does anyone search for on MySpace besides names? Not much. In several years using the site, I've never searched for anything besides peoples' names -- that much I know.
Lex Davidson (URL) said:
Michael, I think Google has two options: 1. Use a semantic form of ad placement, to try and place relevant ads that would match the users intent. or 2. Do what you suggest, integrate the user profile information and data into the sponsored search results so that there is more relevant ads. I don't think Google is going to lay down and consider it a loss, they haven't even explored any of the possibilities they have in front of them to enhance the relevancy and therefore raise the click through rates.
TC said:
Michael - search ads have historically succeeded because they match intent. My intent on Myspace is either entertainment, or connecting with people. I imagine that trying to find an ad powerful enough to make you stop what you're doing and go off to a different site would be very, very difficult, even taking into account your profile and the last few hundred pages visited.

In the context of a Google search results page, or on an information-rich blog, compelling search ads present themselves as helping you accomplish your goal immediately. In the context of Myspace, they're not much different than any other display ad out there, trying to compete for your attention. In this environment, brand advertising is a more natural fit because it does not rely on action on your part to succeed. A natural limit to Google's core business.
Steven (URL) said:
Sure those ads aren't always relevant, but what's worse is that we're now conditioned to look past Adsense type ads altogether. As bloggers know, you have to place google ads right in the middle of content to even be visible. Even that is an annoyance to readers - the only answer as far as text links go is to deeply embed the ads as part of the content, e.g. advertorials.
deecee said:
I think there is a basic assumption here that shouldn't go unchallenged. I work for a fairly prominent consumer-facing site and we us AdSense. We've tried competitors that purport to provide more relevant ads (to associate with our content). And many or successful. But here's the rub: often those ads don't pay as well. Sometimes the best paying ads are folks trying to get where they don't necessarily belong. Long story short, despite Adsense's shortcomings as to relevance, they outperformed when it came actual revenue.

So, the explanation for MySpace's failure may or may not fall at the feet of Google. Perhaps the problem is that MySpace users are happy enough to suffer CPM ads on the same pages as the content they are absorbed in (literally - MS is really a one-one, one-many relationship site so much of what falls outside that is really white noise), they are highly unlikely to act on that advertising (hence the poor results for CPC type adverts).

Just a thought...
FooBar said:
Well I think the key point here is that MySpace *WAS* able to monetize fine without Google, yet google just sucks at serving ads to social networks such as microsoft.
It doesn't matter if the query sucks, people aren't going to search for shoes on myspace. The fact is most people search for names, or bands on mysapce.
joeblow said:
Michael,

I'll admit I know absolutely nothing about the nature of search on any social site, MySpace or otherwise.

However, I am a logical human being... and to that extent it's near impossible for me to conclude any possibility for observing satisfactory paid-ad search results when using the terms "Dan" or "Mike" from cold searching conducted on social sites.

Is there something I'm missing?... It would seem to me that mental telepathy isn't something that Google has managed to crack yet.

I think if a social network member were to first demonstrate a propensity to peruse topics related to tennis shoes, then "Mike" may have some relevancy in the sense of "Be like Mike" and might offer some relevancy for paid-search ads by Nike and other tennis shoe makers -- and your example might thus have demonstrated relevancy that you didn't express in this piece -- but an association with Michael Jordan might not have been what you meant... and it might only randomly be what any other search participant meant either.

Bottom line: I think there is a practical limitation regarding relevancy when using a certain search phrase.

For example: Can anyone suggest how the use of the term "search" could itself demonstrate any practical relevancy?
trent said:
bottom line is that google has no idea what they're doing here - so they're trying to shift blame. who's to blame for youtube?
Brownian Motion said:
MySpace recently hired a VP-level person to drive better monetization. They're not sitting around waiting for Google to figure out display advertising, which is good since the mighty Google is really surprisingly lousy at it, and Doubleclick's technology is a moldy relic. They're a weak number 4 in that market behind MSFT, YHOO, and even (surprise) AOL. Go ahead and read what people think about DART -- it's a pre-1.0 engine for advertising. No wonder they can't make squat.
ben said:
Totally disagree with the 'conclusion' here. It sounds to me that Google is doing exactly what its supposed to be doing in this case... coming back with the most relevant match it thinks works based on its experience with these words. In this case it seems to me that historically people who typed Mike may have misstyped "Nike" and the same for DNA, with people misstyping "dan". In a search of the web, what would you expect to be a great match for these words anyway?

Is it a suprise to anyone that you'd get random, nonesense ads here... have you seen the content of most pages.... its random nonesense... the ads just match!
wow gold (URL) said:
Buy WOw gold, cheap world of warcraft woW gOld, buy gold warcraft WOw gold? We sell World of Warcraft wow gold,
Cheap wOw Gold Look here! wow GoLd Store Welcome you! Look here to Buy WOw GOld, Cheap WOw golD, woW goLD Power Leveling,
buy Cheap WoW gold in here.
sohbet chat sohbet chat çet sohbet chat özcan sarıca ile kurtlar vadisi pusu 3.sezon 1.seo yarışması aytug akdogan ödüllü 1. seo yarışması ve yurtta barış dünyada barış sesli chat sesli sohbet sesli görüntülü chat görüntülü sohbet kameralı sohbet kameralı chat bayan arkadaş görüntülü çet sesli muhabbet kızlarla sohbet kızlarla chat kameralı çet kameralı sohpet kızlarla çet chat gizli kamera güvenlik sistemleri kamera güvenlik kamerası cilt bakımı cilt bakım ürünleri ıslak mendil kolonyalı mendil kolonyalı mendil güvenlik kamerası gizli kamera kamera canlı sohbet sohpet sohbet sesli sesli chat sesli sohbet kameralı sohbet kameralı chat görüntülü chat görüntülü sohbet bayanlarla sohbet sesli muhabbet bayanlarla chat kızlarla sohbet bayan arkadaş görüntülü çet sesli çet sesli sohpet seslichat sesliçet kameralı sohpet kameralı çet kızlarla sohpet kızlarla çet sesli sohbet sesli sohbet sesli sohbet sesli chat sesli chat chat çet ek iş ek gelir mirc avşa adası avşa avşa adası avşa tatil tatil köyleri "Trkycmhrytllbtpydrklcktr" Trkycmhrytllbtpydrklcktr Trkycmhrytllbtpydrklcktr "Trkycmhrytllbtpydrklcktr" "Trkycmhrytllbtpydrklcktr" Trkycmhrytllbtpydrklcktr özcan sarıca ile kurtlar vadisi pusu 3.sezon 1.seo yarışması özcan sarıca ile kurtlar vadisi pusu 3.sezon 1.seo yarışması aytug akdogan ödüllü 1. seo yarışması ve yurtta barış dünyada barış aytug akdogan ödüllü 1. seo yarışması ve yurtta barış dünyada barış "adtech ile reklam 2.0 dönemi başlıyor ve Trkycmhrytllbtpydrklcktr r10.net seo yarışması" adtech ile reklam 2.0 dönemi başlıyor ve Trkycmhrytllbtpydrklcktr r10.net seo yarışması adtech ile reklam 2.0 dönemi başlıyor ve Trkycmhrytllbtpydrklcktr r10.net seo yarışması "adtech ile reklam 2.0 dönemi başlıyor ve Trkycmhrytllbtpydrklcktr r10.net seo yarışması" "adtech ile reklam 2.0 dönemi başlıyor ve Trkycmhrytllbtpydrklcktr r10.net seo yarışması" adtech ile reklam 2.0 dönemi başlıyor ve Trkycmhrytllbtpydrklcktr r10.net seo yarışması ıslak mendil ıslak mendil kolonyalı mendil kolonyalı mendil paketleme ambalajlama paket web tasarım seo refreshing towel perde tatil kozmetik haber joy türk radyo aşk haber video tatil tekstilkent yabancı personel çalışma izni



MyTechSis Otomobil Ödüllü Seo Yarışması

MyTechSis Otomobil Ödüllü Seo Yarışması

sohbet
sohbet
sohbet
chat
msn
kimsesiz
belediye baskanlari
belediye baskanlari
belediye baskanlarimiz
belediye baskanlarimiz
belediye baskanlarimiz
belediye baskanlarimiz
belediye baskanlarimiz
belediye baskanlarimiz
erotik resimler
senato adayları
millet vekili adaylari
belediye baskanları
komik fikralar
manzara resimleri
tente
lynette (URL) said:
640-802 Blame Google For MySpace's Advertising Problems Fuck you! You can't take it back.
emelia (URL) said:
(It's )Up to you. It's nothing. Don't mention it. 640-802 / 70-649 / 640-863 / 350-030 / 646-204 / MB7-515

Join the discussion



Copyright © 2008 Silicon Alley Media, Inc. All rights reserved. Registration on or use of this site constitutes acceptance of our Terms of Service and Privacy Policy.