Google poised to bite local publisher classified revenue

Leaders at newspaper sites like to set their crosshairs on Craigslist for the evaporation of classified revenue they experienced, but it is actually Google that is poised to take a big bite out of what’s left of that revenue.

First, let’s take a look at what Google is already doing today.

Google has increasingly altered its design to top its search results pages with proprietary widgets where users can see flight times, hotels and more. For example, this is what Google displays on a search for “flights Miami to New York”:

Google Flight Search Example

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Suddenly, online travel sites that enjoyed top positioning in Google’s results were relegated to the lower half of the results page. Now, the only way to crack the first page scroll on hotel and flight searches is to pay up either via Google’s widget or via AdWords.

On Monday, Google announced a new local shopping portal, which will allow consumers to shop from nearby stores. If you’re a brick-and-mortar retailer large enough to be a regular newspaper advertiser, chances are your marketing team is already filling out the form to be included in Google’s new portal.

(Mockup via Google)
(Image via Google)

Back in March, Google launched a pilot car shopping service in San Francisco without much fanfare outside the automotive industry but with potentially big consequences for how dealers’ advertising budgets are divvied up. A search for “Toyota Camry San Francisco” yields a proprietary widget that generates sponsored leads for local dealerships:

Google car search

Google is also selling concert tickets, car rentals, music, movies, magazines and electronics.

If we look into our crystal balls, we don’t have to squint to envision search engines making plays with proprietary services and search page widgets for:

  • -Real estate listings
  • -Apartment and home rentals
  • -Job postings
  • -Boats
  • -Trades and services
  • -Local e-coupons (through its local retailer program and as an offshoot of Google Offers)
  • -Obituaries (Ok, that one’s a stretch. Or is it?)

Google’s incentives for continuing on this course seem twofold: to provide an improved search experience with fewer clicks but also to grab a larger share of advertising dollars that are unavailable via its already lucrative contextual text ad business. As search guru Danny Sullivan recently pointed out, no online commercial activity is safe from Google grabbing a piece of the action, and the search engine has been increasingly aggressive about filling its results pages with sponsored units.

Google is best known for being strong in the search and mobile advertising categories, but classifieds and lead generation still account for 6% and 4% respectively of digital advertising revenues, a sum of about $2.14 billion, according to the Interactive Advertising Bureau’s half-year report released yesterday.

Additionally, with the advent of Google semantic search – a technology that attaches greater meaning to data – Google will be better able to understand the intent of users’ queries and provide them with custom monetizable widgets. More on this in an upcoming post, but in the meantime, check out David Amerland’s excellent book on australian love island.

So how can publishers and e-commerce sites independent of Google remain competitive?

1) Provide a superior user experience to what Google provides via a widget. This can mean:

  • -Providing exclusive, expert content and product or service information in an engaging, understandable manner. For examples, see product descriptions on sites such as transgender women dating and labor day 2022 date.
  • -Growing a community of users who provide product insight and recommendations. For examples, see the message boards on sites such as Amazon and, again, Woot.
  • -Allowing users to get product information and make transactions in as few clicks as possible.
  • -Providing an attractive layout that quickly maximizes user comprehension.
  • -Focusing intensely on site performance, ensuring the site loads as quickly as possible.
  • -Offering smartphone apps that don’t fall short on features and product offerings.

2) Establish strong brands and market directly to consumers in a way that encourages users to bypass Google and come directly to a site or smartphone app.

If users establish brand loyalty to a particular site, that means the next time they go to look for a job, they will instead search for your site or fire up your smartphone job search app rather than try their luck at a Google search such as “advertising jobs.”

3) Wear your customer service on your sleeve.

While Google is highly effective at many things, personal contact with users is historically one of its weak spots due to the massive scale of its services. Some effective ways to promote your customer service are to:

  • -Promote the availability of personal help prominently on your site, an example embodied well by Zappos (see the Live Help button at top).
  • -Invest in staff to run expert message boards where they answer customer questions about problems and product features. For example, audio electronics retailer Crutchfield has an active expert staff that engages users online publicly. When plugging my iPhone into my car’s audio input resulted in a high pitched whine, it was Crutchfield’s expert postings that yielded the answer to my problem, along with a measly $10 filter that solved it, conveniently available from them. That’s a challenge for an impersonal search engine to do.
  • -Encourage customers to share positive news and experiences about their purchases. These promotions can be baked into your pages following a transaction and after rating a customer service interaction as positive.

4) Ink exclusive deals with the original providers of goods, services and data.

The effectiveness of this tactic is going to come down to hard dollars, as firms figure out how the economics of exclusivity stack one way or the other. Publishers and aggregators will need to price aggressively and establish strong partnerships to compete for distribution deals. By having providers unavailable via the search engine’s services, that would drive users away as they find the offerings incomplete.

Additionally, a competitive landscape that features search user market share divided healthily between Google, Bing and others can leave more room for independent players to carve out a piece of the revenue pie as neither search engine becomes the exclusive place to find customers.

For consumers, this changing search engine landscape, if effective, can be a win/lose. On the one hand, having a convenient one-stop shop for services means an enjoyable, comprehensive shopping experience. Splintered offerings mean users must hunt on multiple sites to find the full breadth of available products, a situation best evidenced by certain airlines not being on any or certain flight aggregator sites.

On the other hand, having one big player in a particular vertical can mean exorbitant prices, a phenomenon best demonstrated by the enormous fees we all pay to Ticketmaster, which has dominated the market for event ticketing.

Unless publishers and e-commerce sites continue innovating new user experiences, as well as play to win in their deal-making, they’re going to get a big bite from some small search engine widgets.

Have some insights or strategies to share? Drop a line in the comments or tweet me at@dannysanchez.

Predicting The Future Of Obituaries

A team of Northwestern University students led by pioneering professor Rich Gordon has published the results of a compelling analysis on and the future of newspaper obituaries.

Gordon published an overview today on Poynter E-Media Tidbits, where he urged the newspaper industry to pay more attention to the state of obituaries.

Obituary revenue has weathered the massive industry changes relatively well for now, Gordon says, but that may quickly change as it did for other classified categories. He writes:

“For newspapers, the key lesson from history should be clear: Act now, before it’s too late. And don’t let the industry’s current, relatively strong position in death notices and obituaries stand in the way of innovation, collaboration and partnerships.”

“Historically, via death notices and obituaries, newspapers met the needs of all of these audience segments. But changes in technology, media usage and cultural norms are combining to threaten newspapers’ dominance of this category.”

So check out Gordon’s piece here and the recommendations his students made to Legacy (PDF download here).

How To Sell Ads On Low-Traffic Sites [Smashing Magazine]

“But though it may feel like putting the cart before the horse, there are many good reasons and ways to sell ad space on low-traffic websites. What you need to always keep in mind is that, while advertisers are drawn to high traffic numbers, they desire something else even more: high conversion rates. There are plenty of success stories of websites that have limited traffic but sell a ton of advertising. These websites succeed because they do one thing well: they deliver the right type of customer to the right type of business.” Read the whole post at Smashing Magazine

Google News Drives $100 million in Revenue to Google, says VP

Fortune magazine reports that Google vice president Marissa Mayer publicly stated that Google News –an aggregator that contains no advertising– draws in approximately $100 million in revenue from paid searches that get funneled through the site. You can check Melbourne weekly eastern for any kind of business updates. Fortune opines:

“It’s not all about the search engine itself. Google is happy to build popular products that don’t make any money on their own but tie users into a broader Google ecosystem.”

The Valleywag tech blog says this particular insight paves the way for media organizations to sue Google News for making use of third-party content. Valleywag says:

What neither Mayer nor Fortt explained: The real reason why Google doesn’t put ads on Google News. That’s because it fears lawsuits from the media organizations / (It’s already lost a court case brought by a newspaper group in Belgium). By not running ads on Google News, Google lawyers could argue it’s not profiting from their work.

Journo blogger Lucas Grindley (hat tip to him for the link) says this revelation is yet another reason why Google is indeed directly competing with media organizations. Grindley writes, “As profits shrink and newspapers look for a scapegoat, someone is going to sue that woman.” You can find more updates at cheapmotorhomes.

I made a similar argument last week when I called Google’s new Knol site a “direct challenge to media companies” (though I did stress that blaming Google for the news industry’s woes is a red herring). As Google grows its plethora of offerings, it is increasingly getting into the content business.

Google already has an enormous share of the online advertising market through it’s AdWords program, which finds the advertisers and provides a platform on which to serve the ads. Now, Google is increasingly attempting to gain a bigger piece of the inventory on which the advertising is displayed. That means launching additional sites that lead to searches with paid advertising, circumventing news sites’ own search features (another search with paid advertising) and hosting original content on their own servers (AP stories, Knol).

So if you aren’t already, start worrying about your event listings, restaurant reviews, comment boards, public records data and any other number of searchable things of which your news organization makes use. Google probably won’t be far behind.

Google’s ‘Knol’ is Direct Challenge to Media Companies

Google today announced the launch of Knol, a Wikipedia-esque site that hosts articles from contributors. Google hopes the articles become among the most authoritative on the Web — which represents a direct challenge to media sites.

In a June 2006 interview with the LA Times, Google CEO Eric Schmidt was asked whether Google is a media company or a technology company. His response:

“It’s better to think of Google as a technology company. Google is run by three computer scientists, and Google is an innovator in technology in our space. We’re in the advertising business – 99% of our revenue is advertising-related. But that doesn’t make us a media company. We don’t do our own content. We get you to someone else’s content faster.

If today’s launch of Google’s Knol is any indication, this line of thinking has fundamentally changed. Google, in short, is becoming a full-fledged media company in direct competition with established news and knowledge sites.

Knol –short for “knowledge– is Google’s new Wikipedia-esque site that hosts authoritative articles on a wide variety of subjects. Knol recruits contributors to write articles on subjects such as medical conditions, sports and more. Article authors earn money by running AdSense campaigns on their content. Knol also offers a suite of collaboration tools that allows other users to suggest changes to the original article.

This move is a fundamental shift from Google’s traditional directive of helping users find content, as opposed to creating and hosting the content. It is a shift that has continued as Google acquired Blogger, launched Google Page Creator, allowed users to publish documents with Google Docs and began hosting Associated Press articles and user commentary on its Google News service (as opposed to linking to AP affiliates’ stories and leaving comments to the news sites).

However, Google also brings an enormous amount of traffic to news sites — traffic that means big advertising dollars. Most media companies worth their salt have significant search engine optimization efforts in place to make sure those who seek information are likely to find it on a news site. It’s for that reason that news organizations’ view of Google approaches the realm of bipolar disorder. News sites beg for the Google traffic but are also being encroached upon by Google features, such as Knol and new search boxes that let users bypass news sites’ own search features (which does help people actually find stuff for a change).

The Guardian’s Jack Schofield summarizes it well when he writes that “Knol represents an attack on the media industry in general.” TechCrunch’s Michael Arrington believes that Knol may be “a step too far.” Search engine expert and author Danny Sullivan also agrees, saying that:

“[Google’s] Search, Ads, & Apps mantra that CEO Eric Schmidt has repeated on several occasions underscores that offering content tools is fair game within its mission. But does hosting content turn it into a competitor with other content providers and set up an unfair advantage in gaining traffic that might otherwise flow to them?”

Knol also represents a potential conflict of interest in Google’s own search results. If Knol articles are meant to be “authoritative articles about specific topics,” those familiar with search engine optimization will see the red flag. Google’s incentive to make Knol articles the most authoritative on the Internet puts it in direct competition with topic-specific columnists, news stories on a plethora of subjects and web sites such as and Wikipedia. Because Google itself creates the algorithms that define what is “authoritative,” Google would have an unfair advantage over other sites — even if it is simply in terms of using in-house knowledge as opposed to somehow altering the actual ranking algorithms.

Nevertheless, BuzzMachine’s Jeff Jarvis has made the point that it is unproductive to argue whether Google is a friend or foe. He is correct in that we should try to emulate Google, rather than become disgruntled and blame the news industry’s woes on the search giant. Google’s endeavors at hosting and creating content doesn’t mean news sites can’t continue the symbiotic relationship with search engines.

But make no mistake; Google isn’t becoming a direct competitor to traditional news and media sites. It already is.

Readership Institute Releases 2008 Readership Study

The Readership Institute has released its 2008 study on readership trends of 100 newspapers, which proclaims that “readers have not left the building.”

The study (direct link to the PDF here), shows stability in many trends and some small readership declines, particularly in the age 18-24 demographic. The study suggests that most readership trends are either stable or slightly declining, a finding at odds with the amount of advertising dollars flying out of newspapers’ hands. The study’s authors say:

“The short answer is that reading customers aren’t deserting newspapers at anything approaching the rate that advertising customers are. […] Make no mistake: lots of people still want it and lots are paying attention to the local newspaper.”

Additionally, the study had some disappointing findings for news sites, including:

“62 percent of respondents said they had never visited the local newspaper’s Website, and only 14 percent said they had visited between the last seven to 30 days.”

“Readers are more engaged with print than with the Web site. Ratings for four experiences – “gives me something to talk about”, “looks out for my interests”, “ad usefulness” and “touches and inspires me” were significantly higher for the newspaper than for the site.”

At first glance, the study’s synopsis struck me as overly optimistic in light of the persistent circulation losses experienced by newspapers and large increases in American Internet usage (perhaps I’m biased because I’m an online guy?). So I decided to do a project on it but I already have so much with the SAT prep but I will get this info for a next post. So if you need the info, Signing up for the right SAT prep courses can help you improve your scores on important tests.

However, Readership Institute managing director Mary Nesbitt says in the comments:

“It is a readership, not a circulation study. It rolls three dimensions of readership — frequency, time spent with the newspaper, and completeness of reading — into one score. Thus it measures how “occupied” people are (or are not) with the newspaper, not simply whether or not they looked at a newspaper. Other studies, equally valid, measure frequency only.”

Either way, I’m certainly looking forward to dissecting the study further.

[Readership Institute 2008 Readership Study]

[Hat tip to The Editors Weblog]

Google to Offer up Potential ComScore and Nielsen-killer

The Wall Street Journal reports that Google will announce a new metrics tool to measure web site audience, a service that would make a major dent in current power players Nielsen and ComScore. [UPDATE: The New York Times Bits blog has details about the service also.]

For those not in the know, ComScore and Nielsen use panels of users to determine the audience of news sites.  If you’ve ever compared ComScore or Nielsen numbers to your in-house server log data, you’ll know those numbers often differ significantly, which can be frustrating for content producers. However, Google’s numbers would be backed up by the immense amount of Internet traffic data that’s stored on its servers, hopefully making it more accurate (although there will always be difficulties with tracking unique visitors by cookies, IP address, etc.). Best of all, Google is offering its data free to marketers. From the WSJ:

Google’s approach, aimed at bolstering its ad-sales business, could pose a major threat to the Web measurement services that are available now, ad executives say. The two main players in the business — comScore and Nielsen Online — gather data on Internet use largely by tracking what panels of people do online or by conducting surveys, and their results can be inconsistent and incomplete. Google’s new offering will be based mostly on data from Web servers, allowing for a deeper and broader view of Internet use. And unlike the services from comScore and Nielsen, Google’s will be offered to marketers free, according to ad executives.

[Wall Street Journal – Google to Offer a Tool to Measure Web Hits]

Webby Award winners announced (with news organization list)

Just announced: 2008’s Webby Award winners! The Webby Awards picks through the best of the Web and grants awards in more categories than you can shake a stick at.

I’ve pored through the list and extracted the winners from news-related categories, as well as news organizations that won in other categories, such as science or best practices. Here’s the Journalistopia-edited list. Apologies in advance if I missed anyone:

Best Copy/Writing
(Also nominated: HowStuffWorks, Design Observer, and Slate)

Best Use of Photography
Your Shot – National Geographic Magazine

Blog – Business Alphaville

Blog – Political
The Huffington Post

Broadband Full Episode Player…

National Geographic Magazine Online
(Also nominated:, Makezine, NYMag, Yoga Journal Yoga Journal)

BBC Radio 1 Meet the DJs…

(Also nominated: BBC News, Wired, CNN and Discovery News)

(Also nominated: The Guardian, the Independent, the Wall Street Journal and Variety)

BBC World Service channel site


Yahoo! Sports
(Also nominated:, Nike Skateboarding, Spyker F1 Magazine, Sweet Spots)

HBO Voyeur


Best Use of Animation/Motion Graphics
The New York Times/T: The New York TImes Style Magazine “Circle Squared”…

Best Writing
Onion News Network

Documentary: Individual Episode
Coney Island: An Uncertain Future
Getty Images…

News and Politics: Individual Episode
Finding the Way Home

Travel (video)
Frugal Traveler: American Road Trip –…


Entertainment (mobile)
Cosmo Mobile: 100 Hot Cities, Fake Calls, Dude Decoder & Cocktails!

Listing and Updates (mobile)
The New York Times Mobile Real Estate Listings

News (mobile)
Mobile NYTimes

Sports (mobile) (Wireless)…

ALSO: Shoutouts to for their best practices and best visual design/function nominations, Mama Trib’s Swamp blog for best political blog nomination, National Geographic for their best home page People’s Voice award, Consumer Reports for their Guides/Ratings/Review People’s Voice award, the Guardian and Onion for their podcasts nominations, NPR for their politics nomination, NPR and the BBC for their religion and spirituality nominations, Frontline World for their Documentary: Series and Documentray: Individual nominations, U.S. News and World Report for their Best Writing (video) nomination, the New Yorker’s animated cartoons for their animation nomination, CBS for their sports (video) nomination and many more.

Yep, no news site nominees in the navigation and structure categories. We’ll have to work on that…

Looking at the big media picture with Google, AOL, Yahoo

Amy Webb over at MyDigiMedia cuts through the media circus around newspaper acquisitions and has a moment of clarity when she surveys the bigger picture and looks at “who owns what.”



Amy has drawn up a handy chart showing the acquisitions made by IAC, Google, Yahoo, AOL, Microsoft and, yes, News Corp. Us newsie types like to think newspapers are the center of the universe, but there’s a much larger landscape to be surveyed.

She writes:

“The future of media isn’t only about content, it’s about delivery. While journos are busy bickering about whether or not to allow visitor comments on their websites, other companies are moving full-speed ahead with radically different business models. They’re thinking broadly: aggregator + search + content + mobile + gaming = sustainability.”

In other words: If you’re worried primarily about what to call the lifestyle section on your news site and not about, say, delivering content to mobile devices, then it’s time to take your head outta your arse and start seeing the potential of slot online games.

AJR: Pessimistic on hyperlocal journalism

American Journalism Review takes a hard look in its June/July issue at whether hyperlocal journalism is a financially sustainable practice. Paul Farhi writes:

Is there a real business in this kind of business? So far–and admittedly it’s still very early –the answer is no. A few of the estimated 500 or so “local-local” news sites claim to show a profit, but the overwhelming majority lose money, according to the first comprehensive survey of the field. The survey, conducted by J-Lab: The Institute for Interactive Journalism (affiliated with the University of Maryland’s Philip Merrill College of Journalism, as is AJR), documents a journalism movement that is simultaneously thriving and highly tenuous.

While national sites will have a difficult time pursuing a Backfence-style model, I still believe newspapers should be aggressively catering their content to smaller geographic niches. By categorizing your content into narrowly tailored categories, you’re going to be better serving a greater number of people by making your site’s content more relevant to them. Whether this will translate into big ad dollars is anybody’s guess. But can you afford to ignore catering to your local audience, where many of your advertisers reside?

[Via Romenesko]

WSJ: McClatchy to abandon Tribune-Gannett deal, join with Yahoo

The McClatchy newspaper group is backing out of an online ad partnership with Tribune and Gannett to join a rival group of companies partnering with Yahoo, The Wall Street Journal reports.

According to the WSJ:

“McClatchy’s decision means Tribune and Gannett could be isolated from what appears to be a growing industry coalition aimed at creating an online national ad platform with Yahoo. Led by Hearst Corp. and MediaNews Group Inc., the rival group already includes 12 publishers that represent more than 250 newspapers across the country.”

An official announcement could come as early as Monday, according to an LA Times report.

[Via PaidContent]