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Greg Sterling – Search Engine Land News On Search Engines, Search Engine Optimization (SEO) & Search Engine Marketing (SEM) Fri, 23 Aug 2019 14:37:22 +0000 en-US hourly 1 https://wordpress.org/?v=5.2.2 What is ‘Google Screened’ and how does it differ from ‘Google Guaranteed’? /what-is-google-screened-and-how-does-it-differ-from-google-guaranteed-320954 Thu, 22 Aug 2019 20:40:59 +0000 /?p=320954 The company introduces a second screening program for professional services.

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Google Guaranteed was introduced a few years ago, largely to boost consumer confidence in-home services providers appearing in Local Services Ads. More recently, this year, the company introduced another program for professional services, dubbed “Google Screened.”

Limited categories, markets. Google Screened is currently a test program limited to a few verticals in a few markets: lawyers (estate planning, immigration), financial planners and realtors in San Diego and Houston.

Businesses must also possess a star rating on Google of 3.0 or greater to be eligible. There’s no application fee for Local Services advertisers (in the relevant categories and markets). If Google decides to expand the program, there are dozens of available subcategories, including marketing and advertising services.

Google Guaranteed, by comparison, is now widely available and covers a broad range of home services categories, including HVAC, appliance repair, house cleaning, painting, locksmiths, plumbers and others. And if a consumer connects or books through Google, the program offers a money-back guarantee of up to $2,000 (lifetime cap) if consumers aren’t satisfied with the provider’s work.

Similar background checks. To become Google Guaranteed, businesses must pass a background check and have their license and insurance details verified. Google Screened businesses must also pass a similar license and background checks (civil and criminal). However, there’s no satisfaction or money-back guarantee with Google Screened.

Google Guaranteed or partner-screened status (HomeAdivsor, Porch) is a requirement to appear in Google Assistant results on the smartphone and Google Home devices. That does not currently extend to professional services; so lawyers, for example, don’t need to be Google Screened to appear in Google Assistant results. However, that could change to be more in line with Google Guaranteed should Google continue to expand Google Screened (I’m speculating).

Why we should care. While both are useful in helping to protect consumers, there’s also a very close link between the Google badging programs and Local Services Ads. In the case of Google Guaranteed, badging and results were decoupled for Google Home, in part to keep the company from running run afoul of FTC ad disclosure rules.

It will be interesting to see, going forward, whether Google Screened expands and whether Google makes it available (as it has with Google Guaranteed) to non-advertisers. And if it does, the next question is whether the company offers any rankings boost to pre-screened companies as a defense against fake local listings and spam — which is precisely what it’s doing with Google Guaranteed and the Google Assistant.

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FTC smacks down anti-review ‘non-disparagement clauses’ in form contracts /ftc-smacks-down-anti-review-non-disparagement-clauses-in-form-contracts-320826 Mon, 19 Aug 2019 19:46:41 +0000 /?p=320826 Make sure your contracts don't have terms that violate the CRFA.

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There are numerous studies circulating that show how important reviews are to consumer purchase decision-making. To protect the integrity of online reviews Congress passed The Consumer Review Fairness Act (CRFA) in 2016. This was largely modeled on an earlier California law.

CRFA makes non-disparagement clauses illegal. The intention of CRFA was to “prohibit the use of certain clauses in form contracts that restrict the ability of a consumer to communicate regarding the goods or services offered in interstate commerce that were the subject of the contract, and for other purposes.”

These terms are typically called “non-disparagement” clauses and have been used periodically by professionals and corporations to pre-empt and prevent negative reviews. They often provide financial penalties or the right to sue for their violation. But they’re illegal.

Trying to get away with it anyway. Apparently quite a few businesses didn’t get the memo. Last week the FTC announced that it had settled administrative complaints with five firms using these illegal clauses in their customer contracts:

  • A Waldron HVAC
  • National Floors Direct
  • LVTR LLC
  • Shore to Please Vacations
  • Staffordshire Property Management

The FTC administrative complaints were originally announced in May and June. (The Yelp blog has some additional factual detail about the companies and circumstances.) It’s not clear if these contracts have just been in use for years (pre-dating the CRFA) or whether the companies got bad legal advice.

Must notify all their customers. Each of these firms must now notify all consumers who signed their agreements that the contractual provisions in question are not enforceable. There are other multi-year reporting and compliance requirements that the FTC orders impose as well.

In addition, Shore to Please Vacations apparently sued a vacation renter, who had written a negative review, in Florida civil court. It must now dismiss the private lawsuit for breach of contract.

Why we should care. Any marketer, brand or business owner contemplating any scheme to prevent or preempt negative reviews needs to stop thinking this way immediately. These efforts invariably backfire and cause more damage to the business’ reputation than anything contemplated by the non-disparagement clause.

Marketers need to follow review best practices and treat reviews and responding to them as just an ordinary part of doing business. It’s also important to remember that businesses that have some critical reviews ultimately have more credibility than those with only five star reviews.

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Voice assistant usage now at ‘critical mass’ as Google Assistant crowned smartest /voice-assistant-usage-now-at-critical-mass-as-google-assistant-crowned-smartest-320798 Mon, 19 Aug 2019 15:38:49 +0000 /?p=320798 Google Assistant scored 93%, Siri 83% and Alexa got 80% of answers right in a recent study.

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In the past, some people referred to search as “the universal interface.” That role is gradually being taken over by voice assistants.

112 million monthly users. A new estimate from eMarketer pegs the number of monthly users of voice assistants at roughly 112 million, up from 102 million in 2018. The firm characterizes this as “critical mass,” although it still represents a minority of internet users (40%).

By 2021 eMarketer says about 123 million people will be using voice assistants at least monthly.

Smart speakers lag smartphones. More voice search and engagement happens on smartphones than smart speakers, which eMarketer says are used by 77.6 million people. The actual number of devices in U.S. homes may be greater than the number of individual users.

Separately, last week, Loop Ventures released its latest comparison of virtual assistants. The report focuses on smartphones and rates Google Assistant, Apple’s Siri and Amazon’s Alexa in their responses to 800 questions across a range of categories: local, commerce, navigation, information and “command.”

Google Assistant the best performer, but Siri and Alexa did well. The study found, “Google Assistant was once again the best performer, correctly answering 93% and correctly understanding all 800 questions. Siri was next, answering 83% correctly and only misunderstanding two questions. Alexa correctly answered 80% and only misunderstood one.”

Source: Loop Ventures (2019)

Loop said that the biggest gap in the scores happened with commerce-related queries (e.g., “order more paper towels”). Google Assistant correctly answered 92% of requests while Alexa had a score of 71% and Siri 68%.

The report also expressed surprise at the continuing rate of improvement in accuracy. “There have been dramatic improvements on each platform and in each category in the few short years that we have been tracking the progress of digital assistants.”

Why we should care. A 2018 Microsoft survey found that Google Assistant and Apple’s Siri had identical usage share (36%). But because Microsoft doesn’t own a smartphone platform its digital assistant Cortana has been compelled to reposition (and was not included in the comparison above). For the same reason, Amazon’s Alexa is at a disadvantage vs. Apple and Google.

Ultimately Google Assistant is in the strongest position and will likely become the dominant voice assistant, with corresponding advertising and commerce implications for marketers and brands. An open question is whether or how much voice will eventually supplant traditional search on mobile devices.

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Why is there so little innovation in local? /why-is-there-so-little-innovation-in-local-320694 Mon, 19 Aug 2019 14:31:30 +0000 /?p=320694 The alpha and omega of local is now Google.

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If you were to search for “local” in the App Store, you might expect to see dozens and dozens of apps. Instead, what you get are a few familiar brands: Facebook Local, Eventbrite, Nextdoor, Weatherbug, some news and then casual dating apps. It’s kind of bizarre.

This is a metaphor for the shrinking world of local.

Only a few sites matter

Not long ago, I gave a presentation that argued local online marketing is essentially about Google and Facebook, with some attention required to Yelp, Apple Maps, relevant verticals — and maybe Bing. Almost everything beyond this is either not important or declining in importance.

This is in stark contrast to the way it was a decade (or so) ago when multiple “horizontal” directories and local search engines competed for consumer traffic. Some may not believe it, but Google was only one of a number of sites consumers could use to look for local business information (remember Yahoo Local, Mapquest and Citysearch?). That has now radically changed.

But not only has the number of “sites that matter” changed, there’s almost no new consumer-facing innovation happening in local. That may sound wrong, but all the sites you would probably name are roughly 10 (or more) years old.

Trillions in spending, declining invention

Local is one of the most vibrant segments of the digital economy — one could even argue the most important. Trillions of dollars in offline consumer spending are influenced by online marketing and consumer reviews.

Reflecting that, there’s a dizzying array of companies competing for enterprise and SMB marketing dollars to target and influence local consumers, manage reputations and measure the effectiveness of media.

But the alpha and omega of local is now Google, where there’s a frenzy of development and activity (the Assistant, ads, Home, etc). Then there’s Facebook, which has built an important local business with Marketplace. It also has Groups (sometimes local) and has aggressively gone after SMB marketing dollars. But Facebook has otherwise resisted building new consumer experiences for local.

Facebook tentative, Yelp under pressure

In 2017, Facebook rebranded its events app “Facebook Local” and I got very excited. But two years later, the company doesn’t really promote the app and I’m unaware of anyone using it today. Nobody talks about it, ever. Even if it’s being used, it’s underperforming its potential.

As I see it, Google’s only direct, “horizontal” competitor in the U.S. is Yelp. Yelp is a public company under pressure from some unhappy shareholders, The company is chugging along but is making only modest, incremental improvements in the user experience. And like other local giants, it launched 15 years ago.

When it appeared in 2004, Yelp had multiple competitors, which have long since disappeared (i.e., Citysearch, Sidewalk, Insiderpages, Judy’sBook, Tribe.net). Even once-promising Foursquare isn’t true a competitor anymore. The company shifted its model B2B services around location intelligence and the consumer app is now just a source of first-party data.

I’m mystified that Foursquare doesn’t do anything more experimental for consumers. Given its new business model, it can afford to take some risks and build new apps — even if they crash and burn. It doesn’t need to monetize them.

And Yelp itself now faces an existential threat from Google and the rise of GMB because of the latter’s review velocity and volumes. Based on recent research from social media and reputation management platform SOCi, Google appears to have more than 10x the review volume of Yelp for the same business locations.

Nextdoor, Waze and Amazon

Nextdoor is an exception to my generalization about missing consumer innovation in local. It has truly built a local juggernaut. But the site emerged after a pivot in 2011 – eight years ago. And if you look more closely, there’s not much innovation happening on the site today. If anything, Nextdoor has become more cautious – perhaps charting a course toward an IPO and boosting its revenue with national-to-local ad dollars.

What about Waze? It’s doing some innovative things with advertising and location. The site launched in 2006 and was acquired by Google in 2013. Yes Waze has been innovative – but it’s part of Google.

Several years ago, mapping-related innovation was growing, as evidenced by apps and services like Apple Maps, Bing Maps, HERE and a 3D mapping company once called Recce (now known as WRLD). But that seems to be substantially over, with Google Maps the victor.

How about Amazon? Amazon is a local dilettante. In 2005, the company developed a version of Google Street View (A9 Maps Block View) before Google Street View. It has also toyed with building local services marketplaces and directories. But it has never committed to local, and isn’t a key player in the space. It certainly could acquire companies if it wanted to.

What about all the verticals?

What about all the verticals? Yes, there are many local directories and marketplaces in numerous verticals: TripAdvisor, Zillow, ZocDoc, Thumbtack, HomeAdvisor and dozens of others. But most of these sites have now been around for years and most of them are not “brands.”

Zillow has a moderately strong brand but is also 15 years old. TripAdvisor, whose brand is arguably in decline, was founded in 2000. (And despite its paleolithic UX, Craigslist is still going relatively strong.)

Indeed, while there are many vertical directories, there are few known brands. Most of these sites rely on SEO and, as the SERP changes, increasingly are compelled to buy traffic (see HomeAdvisor-Angie’sList). Their business models are essentially a version of arbitrage.

I would argue that with a couple of exceptions, most of these local-vertical brands are getting weaker, not stronger as Google beefs up its local offerings (e.g., travel, local service ads) and captures more traffic. Yet, building a brand is the only way to have long-term success in local (and in general). If you’re relying on SEM and SEO for traffic and visibility your costs will keep going up and your brand will suffer as the algorithm and SERPs change.

Uber is 10 years old too

I know what you’re thinking: “what about food delivery and ride sharing?” Food delivery isn’t innovative and has existed in its own vertical for years, despite some of the companies being newer (e.g. DoorDash, GrubHub). Uber was founded in 2009 and was highly innovative — though it couldn’t have existed without Google Maps. But it’s now a decade old, with investors questioning its long-term outlook.

Most new startups in local are SMB-facing SaaS companies or otherwise focused on catering to multi-location enterprises but don’t touch the consumer. There’s lots of competition and activity in those areas. So why is the consumer side such a ghost town even as the B2B ecosystem in local/SMB is highly dynamic and competitive?

I believe it’s because investors don’t think anyone can take on Google directly and succeed. They will fund B2B ventures and consumer startups in specific industries, but typically those are about about bringing more efficiency or new inventory to an existing segment rather than doing something truly innovative. AirBnB and WeWork are arguably examples of this.

Most consumer-facing startups have to rely on SEO for traffic but, increasingly, that’s not an effective let alone sustainable strategy. Yelp built its traffic and brand using SEO more than a decade ago. If it were to launch today it probably wouldn’t succeed.

Wanted: new experiences, competitors

Having a couple of dominant consumer destinations helps organize the world for local marketers, but it’s not good for consumers — or businesses, by extension. I believe there are still opportunities to create new types of local experiences for consumers (e.g., Niantic Labs and AR) but there are competitive and business model challenges that inhibit investors from funding new local consumer ventures. Yet it’s clear that the market truly needs them.

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Conductor purchase price revealed: $126+ million [updated] /conductor-purchase-price-revealed-15-8m-cash-97-8m-stock-320711 Fri, 16 Aug 2019 15:53:02 +0000 /?p=320711 The acquisition price was more than 2X invested, but probably less than what investors may have wanted.

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In March last year, SEO firm Conductor was acquired by WeWork (now “The We Company”). The purchase price wasn’t revealed until We’s S-1 filing, which came out Thursday.

Correction: In accordance with the data in the S-1, we reported the purchase price as $113 million. Following the publication of the original article last week, a Conductor shareholder reached out to me to offer some factual corrections that weren’t made clear in the S-1.

$126 million (plus earnout). The Conductor deal, it turns out, was done for a total value of $126 million, roughly $98 million of which was in stock. There was also an undisclosed earnout that was “substantial,” although the precise figure was not provided to us. Conductor raised roughly $60 million. That compares to independent SEO firm BrightEdge which has raised nearly $62 million.

Here’s an excerpt discussing the acquisition from the WeWork S-1 filing:

In March 2018, the Company completed the acquisition of 100% of the equity of Conductor, Inc. (“Conductor”) for a total consideration of $113.6 million. The total consideration included $15.8 million in cash and $97.8 million in Series AP-1 Preferred Stock. As of December 31, 2018, $0.2 million of cash and $10.0 million of the Series AP-1 Preferred Stock that were held back at closing remain included in other current liabilities and additional paid in capital, respectively on the condensed consolidated balance sheet. As of June 30, 2019, all holdbacks have been released and the Company received $0.2 million as a purchase price reduction, which was recorded as a measurement period adjustment to goodwill. Conductor was founded in 2006 and is a marketing services software company that provides search engine optimization and enterprise content marketing solutions.

A ‘big win’ — depends on your POV. When the Conductor deal was announced, Conductor CEO Seth Besmertnik said it was a “huge win for the entire industry.” That depends on your perspective.

The vision for Conductor is to offer its SEO and other services to WeWork’s enterprise customers. In addition, Conductor will also provide marketing education through the Flatiron School, another WeWork acquisition.

Investor appetite unclear. The We company’s valuation was roughly $47 billion in January. The S-1 reveals that it has a $3 billion annual run-rate. This sky-high valuation compared with revenues, together with some of the strange We Company disclosures, has led to unflattering headlines such as “WeWork’s IPO would be a bewildering way to waste your money.

Still, the mostly stock transaction could pay off nicely for Conductor. We’ll have to see what investors’ appetite is for The We Company.

Uber, the most recent tech-company IPO, has had a tough time so far, with investors now deeply skeptical about the long-term outlook for the company. Uber’s performance could dampen demand for We, especially in the larger context of fears of a coming recession.

Why we should care. For Conductor customers, not much is likely to change in the near term. The company has been operating under We’s ownership for months now, and it’s likely such a small part of We’s sales and earnings it’s not likely to get much mindshare from the mothership. That means Conductor’s leadership, led by CEO Seth Besmertnik, will likely be left to run the company with little interference.

The SEO industry has multiple companies seeking to be acquired or exit in the next few years. Conductor’s acquisition price could establish a benchmark that would-be buyers use to value other companies. While the acquisition price is greater than what the S-1 reflects and what we originally reported, it is lower than what some investors were probably hoping for.

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SMX East: now with extra local /smx-east-now-with-extra-local-320666 Fri, 16 Aug 2019 13:32:20 +0000 /?p=320666 GMB, maps, reviews, voice and offline conversion tracking are all on the agenda.

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People in the local SEO community have consistently expressed interest in more local content at SMX events. SMX East addresses that with a new, dedicated local track, as well as several other sessions that will include local and mobile content.

Sessions cover ranking, presence management, GMB, reputation management, voice, the future of local search and tracking online-to-offline conversions. Additional SEO and SEM sessions will also feature locally-relevant topics and issues.

Here are the specific local (and voice) sessions, which will mostly be moderated by me and Barry Schwartz:

  • Ranking in Google Local and Maps
  • Local Presence Management for Multi-location Brands
  • Google My Business From A to Z
  • Managing Reviews On Multiple Local Platforms
  • Conversational Search and The Impact Of Voice On SEO
  • The State of Offline Conversion Tracking
  • Future-Now Local Search: Assistants, Voice, Maps and More

These sessions will be lead by local marketers and leading SEO practitioners — who can’t wait to spill their secrets. But wait, there’s more.

I’ve also been asked to organize a local marketer/SEO meet-up on November 13. This will be a chance for local SEOs and in-house marketers to come together, network and discuss important issues (and potentially rant). I’m also working on a surprise guest.

The sessions themselves will emphasize best practices and leading tactics for multi-location brands and enterprises. But the lessons and insights will equally apply to smaller businesses. The content will skew advanced, but there will be plenty of opportunities to engage with speakers and ask questions.

Not since SMX put on a dedicated local-mobile event more than a decade ago has there been this much local content at a single show. If you have questions or comments feel free to contact me.

We hope to see you there on November 13 – 14. Early bird pricing expires on August 24.

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FTC: Breaking up Google, Facebook to restore competition on the table /ftc-breaking-up-google-facebook-to-restore-competition-on-the-table-320553 Wed, 14 Aug 2019 13:38:54 +0000 /?p=320553 We're a long way away from that, but a rhetorical Rubicon has been crossed.

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In Europe and, increasingly, the U.S. there’s a growing sense in political and regulatory circles that more dramatic measures are needed to address a concentration of power among tech giants. Tuesday afternoon, the head of the U.S. Federal Trade Commission (FTC) said for the first time that breaking up companies was on the table.

Breaking up is a now potential remedy. This is an idea that several European Commissioners floated a few years ago but few took it seriously as more than a bargaining position. The statement from FTC Chairman Joe Simons is quite different.

Simons told Bloomberg that breaking up companies could be “the right remedy” to restore competition, although he’s reluctant to try it unless absolutely necessary. Currently, the FTC and Justice Department are engaged in a broad review of the operations and business practices of Google, Facebook, Apple and Amazon.

Unwinding Waze and Instagram. In particular, the FTC could compel the “unwinding of acquisitions” such as Waze (Google), WhatsApp, Instagram (Facebook), among others. Some have suggested Facebook adding its brand to WhatsApp and Instagram is partly about making it more difficult for regulators to unwind those acquisitions.

Separately, earlier today, more than 20 European job search sites sent a joint letter to the European Commission, as a prelude to formal complaints. They’re arguing that the company’s own job-search answer box is harming competition and hurting their traffic and profits. This criticism has been leveled by numerous industry rivals, in segments ranging from shopping to local and travel.

Fines had little impact. The European Commission has fined Google more than $9 billion, in three separate antitrust cases, since 2017. Facebook was recently fined $5 billion for data and privacy violations by the FTC. However, these massive fines have had little or no impact on either company and the market has shrugged them off.

However, in Europe Google has also been required to make a number of changes in its operating practices. For example, Google will soon offer Android users in the EU a choice of search engines when they set up a new phone. However, that solution is already proving to be controversial, as has its shopping search remedy introduced nearly two years ago.

Google has denied that any of its actions are abusive or anti-competitive and is appealing the European Competition fines and rulings. The company says its innovations benefit consumers, which is accurate. But both the Europeans and American regulators are looking at the broader market impact of the company’s products and activities.

Why we should care. In late 2012, the FTC said there wasn’t enough evidence of “search bias,” that Google was favoring its own properties at the expense of rivals. Europe proceeded to take up the banner of antitrust and prosecute multiple investigations, imposing the above-mentioned fines and penalties.

Now the political climate in the U.S. has changed and there’s broad agreement among both Democrats and Republicans that a new round of investigations and scrutiny of big tech companies are warranted. Those investigations are now underway.

Until recently there had been a lack of philosophical agreement between European and U.S. regulators. Now there appears to be broad alignment, which could mean stronger regulatory action going forward. But at a minimum, the rhetoric around potential remedies has intensified.

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Ecosia says it will boycott ‘search choice’ auction on Android in Europe /ecosia-says-it-will-boycott-search-choice-auction-on-android-in-europe-320483 Mon, 12 Aug 2019 16:20:30 +0000 /?p=320483 Will other European search engines also reject Google's antitrust remedy?

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Berlin-based search engine Ecosia says it will not participate in Google’s “search-choice” auction for Android devices in 2020 in Europe. Will other engines follow its lead?

Search choice to start in 2020 on Android. Earlier this month, Google announced that it will introduce a new “choice screen” in Europe for Android users in 2020. The screen will appear during set up and ask users to select a default search engine.

Google plans to use an auction, as it does with comparison shopping engines in Europe, to determine which search engines to present on the choice screen. The three highest bidders will appear, along with Google, as options for users. Google anticipates search choices will vary by country, with Google always present as a choice.

Search choice is Google’s effort to comply with the European Commission’s (EC’s) July, 2018 antitrust decision involving Android and app bundling. Google has appealed the decision and a roughly $5 billion fine.

Example ‘search choice’ set-up screen for Android

Ecosia CEO Christian Kroll issued a statement this morning explaining its decision to boycott the auction process. He said, “We’re deeply disappointed that Google has decided to exploit its dominant market position in this way. Instead of giving wide and fair access, Google have chosen to give discrimination a different form and make everyone else but themselves pay, which isn’t something we can accept.”

‘Creating scarcity.’ The statement offers three reasons why Ecosia believes the auction approach is misguided:

  • Ecosia believes that it is unethical for a company with a dominant market position like Google Android to discriminate access to it. Google’s attempt to auction access rights to Android is an insult to the European Commission and to the principle of equality in front of the law.
  • Alternative search engines that focus on privacy or specific causes (i.e. fighting the climate crisis, to raise money for charity, or to ensure user privacy), are unlikely to be able to competitively bid in this suggested auction set-up. Profit focused partners, many of whom have access to higher monetising Google ads, automatically have better odds in this setup. This means that the competitors which are purpose-driven (and not solely profit orientated) are conveniently removed from the auction process.
  • By artificially limiting user options, Google is creating scarcity where there is none. This will unnecessarily increase costs for alternative search engines, and will keep new entrants from growing market share.

Ecosia was founded in 2009 and donates most of its “surplus income” to non-profit organizations focusing on reforestation and conservationism.

Faced with immediate criticism of its announcement, Google defended the auction as “a fair and objective method to determine which search providers are included in the choice screen. It allows search providers to decide what value they place on appearing in the choice screen and to bid accordingly.”

Why we should care. Whether or not there are 4 or 14 options for users to choose from, Google would still likely retain most of its current usage in Europe, because of its brand strength versus rivals. This is the central challenge for regulators, which are trying to “unbundle” Google and Android: how to give Google’s competitors more visibility (and viability).

Comparison shopping engines have complained that the auction-based remedy used to give them more visibility in search results for the past few years has been more corrosive than beneficial.

It will be very interesting to see whether other search engines align themselves with Ecosia or decide to participate in the auction. Applications are due in mid-September. The EC still has the power to ask Google to come up with an alternative approach. And the market’s response will have a significant impact on their determination.

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Review counts matter more to local business revenue than star ratings, according to study /review-counts-matter-more-to-local-business-revenue-than-star-ratings-according-to-study-320271 Mon, 05 Aug 2019 20:38:21 +0000 /?p=320271 Womply also found businesses claiming their listings on multiple sites generated 58% more revenue than the average.

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Reviews matter; that’s well established. What’s not quite as clear is the relationship between reviews, star ratings and revenue, although there have been several academic studies on this. Now, small business SaaS provider Womply has released a large-scale study showing a strong connection between reputation management and revenue across multiple industries.  

More than 200K businesses examined. In performing its analysis, Womply looked at reviews and transactions data “for more than 200,000 U.S. small businesses in every state and across dozens of industries, including restaurants, salons, auto shops, medical and dental offices, retailers, and more.” The key difference between this study and others on reviews is local business transaction data. Womply was able to connect review and presence management best practices with revenue outcomes.

More claimed listings equals more revenue

In brief, the study found:

  • Businesses claiming their listings on multiple sites earn 58% more revenue
  • Businesses that respond to reviews average 35% more revenue
  • Businesses with ratings of 3.5 to 4.5 stars earn more than those with higher and lower ratings
  • Businesses with more reviews (than the average) across sites generate 54% more revenue

Claim and respond. Businesses that didn’t claim their listings averaged $72,000 less in annual revenue according to Womply. Claiming listings on key sites like Google My Business enables consumers to find and engage with businesses more readily. This isn’t news.

Another “no-surprise” finding is that consumers appear more inclined to buy from businesses that respond to online reviews. This may be because they assume those responding to reviews offer better service. According to the study, 75% of businesses don’t respond to their online reviews. But those that do earn considerably more revenue.

Responding to more reviews is correlated with more revenue

An interesting caveat here appears to be one of diminishing returns. Businesses responding to more than half of their reviews weren’t earning more than those responding to between 25% and 50%. The study doesn’t go segment by positive or negative review responses. There may be more nuanced findings here yet to be unpacked.

The optimal ratings range. Womply also discovered an optimal star-rating range. Businesses obviously don’t have control over this. But the company found that businesses in the 3.5 to 4.5 star range had more average revenue than those below or above, including businesses with 5-star ratings.

Womply offers two reasons to potentially explain the under-performance of 5-star businesses compared with those in the optimal range:

  • Five star businesses tend to have fewer reviews
  • Consumers may be more skeptical of 5-star businesses (assuming manipulation)

Review counts trump reviews. The study also discovered that review counts were more strongly correlated with revenue performance than average star ratings. The company said, “Businesses with more than the average number of reviews bring in 82% more in annual revenue than businesses with review counts below the average.” I suspect, however, that below a minimum star-rating threshold this observation would no longer hold up.

Review counts and revenues

Why we should care. Here’s where one injects the familiar maxim, “correlation doesn’t equal causation.” Businesses that already “get it” are going to outperform those that don’t, in part because they’re probably better run. And these businesses are more likely to pursue and execute local SEO tactics effectively: claim and populate your profile on key sites (e.g., GMB, Yelp), respond to reviews, and have a program in place that generates a steady stream of reviews in an ethical way.

One thing not revealed here is whether and what percentage of these businesses worked with agencies or third party providers. Regardless, and despite the fact that much of this is already known in the community, the revenue analysis validates the real-world impact of these best practices.

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Google to offer mandated ‘search choice’ to EU Android users in 2020 /google-to-offer-mandated-search-choice-to-eu-android-users-in-2020-320232 Fri, 02 Aug 2019 15:08:09 +0000 /?p=320232 However, use of an auction for inclusion on the choice screen has some search rivals complaining.

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Google is introducing a new search engine “choice screen” in Europe for Android users. It’s reminiscent of what Microsoft was compelled to do roughly a decade ago, to offer “browser choice” on the desktop in Europe.

Part of antitrust compliance. This comes as part of Google’s effort to comply with the European Commission’s (EC’s) July, 2018 antitrust decision involving Android and app bundling. Google has appealed the decision and the associated roughly $5 billion fine.

Starting in 2020, when Android users set up their devices they’ll be presented with a version of the following screen. Google says providers will potentially vary by country.

Default in Chrome and on the home screen. When a user makes their choice, the provider will become the default search engine:

  • In Chrome (if the browser is installed)
  • On the home screen search box
  • The search app of that provider will also be installed (if not already)

The criteria for consideration include: being a general (and not vertical) search provider, support for the local language, and free availability in Google Play. Search providers will need to apply to Google by September 13. And by October 31, the list of search engines for each country will be confirmed.

Beyond the application, Google will conduct an auction to determine which engines are included on the choice screen. Successful bidders will be presented at random and “pay each time a user selects them from the choice screen in the given country.”

Here’s how the process will work according to Google:

In each country auction, search providers will state the price that they are willing to pay each time a user selects them from the choice screen in the given country. Each country will have a minimum bid threshold. The three highest bidders that meet or exceed the bid threshold for a given country will appear in the choice screen for that country.

Google says auction is fair and objective process. The idea of an auction has caused some critics to complain that Google is again “abusing its dominant position.” However, Google defended the auction as “a fair and objective method to determine which search providers are included in the choice screen. It allows search providers to decide what value they place on appearing in the choice screen and to bid accordingly.”

The CEO of Search Engine Ecosia, Christian Kroll, issued a statement in response to the news of the auction. This is really disappointing news. Ecosia is a not-for-profit search engine – we use our revenue to plant trees in areas affected by deforestation or desertification, not to get into bidding wars,” he said. “If we choose to enter an auction and pay Google for the privilege of being a search engine option on Android, this will potentially be at the expense of millions of trees we could otherwise have planted.”

It’s also not entirely clear whether or how the auction process might co-exist with phone manufacturers’ (think: Samsung) control and discretion over their Android home screen real estate. This might negate their ability to charge providers to be the default engine on those devices.

Why we should care. The European Commission may step in and prevent Google from charging rivals to participate in the search choice screen but that remains to be seen. Although Google is silent on this, it will appear as a choice in every country and is presumably not going to compete in the auction.

Because of its brand strength and existing usage, Google is likely to “win” in most cases unless rival search engines aggressively market some differentiating feature (e.g, privacy). Thus it’s unlikely that Google’s mobile search reach or ad revenue will be impacted much, if at all, by this process.

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