I have been a follower of Jonathan Mendez's Optimize and Prophesize for a while, and recently interviewed him.
At SES in New York you are speaking on a panel titled "search becomes the display OS" - what does that mean, why is this shift happening?
The shift is part of the Darwinian evolution of the web. Many people have mistakenly viewed search as a channel when in reality it is a behavior. It is the way people use the web. This is clear as YouTube is now the #2 search engine, Facebook, eBay & Craigslist are in the top 10 search engines and Twitter is trying to position itself as a real-time search. Search is integral to the web experience.
From the display standpoint we need to keep in mind that this medium does not need ads to support it nor are ads part of the experience. Display advertising was built as a parallel platform - not weaved into the web like search but placed on top of it. Display has always had its own ecosystem of real estate, content and serving that is separate from the public web.
What we've witnessed with display's lackluster performance and the inevitable crash of CPM rates is the idea of it being a stand-alone platform was wrong. Display needs to be an application that is integrated with web platform and the way people use the web. It should be based on user controls and rules based delivery of content. To truly be relevant and useful for people, publishers and advertisers, it must become a web service like search.
Search is currently at the center of the web. Do you foresee any technologies or services that might shift its position?
On the contrary I think it will become more entrenched and important since everyday millions of new pieces of content data keep getting added to the web and older content gets digitized. As I mentioned search is basic human behavior. We all go online with a goal in mind to either recover information and content or discover information and content. Those behaviors are primal. No technology or services will shift them.
How do you place value on a search impression?
The value is based on what you do with the information. Impressions are the ultimate arbiter of interest and demand. Of course if you go to Google trends often you will become somewhat worried about the collective psyche of this country. In all seriousness however, this is business intelligence. Quick story about impressions - a few years ago I was working with a big client and they were launching a new product. We had purchased the category kw for this product over a year and it hardly had any impressions. We strongly advised them against spending two million dollars to launch this product because there was no demand for it. They didn't listen to the "search" guys. Within a year the CMO was fired because the product flopped. So in that instance I would say those couple hundred impressions were worth two million dollars.
One of the most powerful pieces of search is that the ad unit looks just like the content. What can publishers do to maximize ad integration without risking their perceived credibility?
In my experience you add credibility as a publisher if you provide helpful, useful and interesting content. There's no reason that can't be an ad. Most everyone I know has clicked on a Google ad. Sometimes it is preferable. This creates value to Google as a publisher. Ads that are helpful and interesting will add value to other publishers in the same manner because they are helping their visitors. People rarely forget who helped them in a useful way whether it be a website or "in real life." In fact there is a large intangible value that is not even being captured when this happens. I think some people even refer to it as branding.
What can publishers and vendors learn from the dominance of search when thinking about how to build and brand their websites? What are some easy ways to make our user experiences more relevant?
Give people control over the delivery of content. The most successful online segmentation strategy is when a person tells you what they want -- self-segmentation. That is the beauty of search. The keyword is the ultimate expression of people's goals. No website or advertiser knows more about what I want than I do! It explains why the best and most successful experiences on the web (Google, eBay, Craigslist, Yelp) have query fields and lots of text links and it is something I always keep in mind in doing page design. As far as branding I think that goes back to what we were just talking about, the site experience. Great experiences build brands and that is the same online as well as off. Keep in mind all of this should be tested and optimized. It is no accident that Google is the #1 brand in the world without spending a penny on advertising. From day one no one has tested online experience more than Google.
Many people have been promoting Twitter as a Google-killer in real-time search. Why are they wrong?
You mean besides the fact that Google made $21B in ad revenue last year has $8B in cash, owns half a million servers and Twitter search has probably 10 employees and no revenue?
There are some major problems with RTS. First let's start with the way people search. This has been studied and very clearly defined over the years by brilliant people like Andrei Broder, Daniel Rose and others. I recently took the query classifications they defined and applied it to RTS (http://www.optimizeandprophesize.com/jonathan_mendezs_blog/2009/02/misguided-notions-a-study-of-the-value-creation-in-realtime-search.html). I came to the conclusion that with optimal RTS - which is a huge challenge as I'll get to - that less than 20% of all queries would benefit in anyway from RTS.
As far as the technical challenges spamming would be very hard to filter in real-time. Also authority as we know from PageRank is a fundamental driver of relevance. How do you define authority in real time? If you do not rank results than is it just a noisy stream? I've come to the conclusion that if it RTS becomes anything useful it will be a search vertical, like travel. Helpful for certain things but nowhere near a primary search tool. It is still a great addition to the web but not something Google needs to be concerned with. In fact I think Google is in the position to provide RTS for the entire web which is much more useful than RTS for a single app.
How slow and painful will the transition of ad dollars from offline to online be? What will be the catalyst that allows ad agencies to push search and online aggressively?
Very slow, but this shouldn't be painful. We know the attention is online so dollars will continue to increase but I think a $25 billion dollar online industry is pretty good right now. It's grown much faster the past few years than even the most bullish forecasts from five years ago. The catalyst will be innovation and the businesses themselves that must demand performance. Bill Gross the inventor of PPC said it best, "the true value of the Internet is in its accountability…performance guarantees have to be the model for paying for media." As soon as we embrace performance for all advertising, even so called brand advertising, we will prove our value and grow our industry. Google stands as proof of concept for this. But the battle over performance will be long and bloody. In just the past couple of weeks we've had groups like the IAB and the AAAA speaking out against performance and metrics. This type of rhetoric and their fear of accountability are actually helping to slow down the transition.
How many newspaper companies do you see lasting through this economic downturn?
Not too many. Besides the fact that their authority over the past years has waned with bloggers and false reporting the real problem is that newspapers are not an efficient means of information compared to everything else we have today. What percentage of the paper is relevant or interesting to you? 5%? 15%? Yet you are paying for the entire paper when you buy it. Doesn't make sense. We used to have town criers too, but then newspapers came along. I don't think most people will miss them. Times have changed. Maybe we've just come full circle - people getting their news from other people they trust is the best way to disseminate information. Who trusts the papers?
What will the online vs offline divide look like in 2 years? 5 years? 10 years?
I'm not so sure we'll have a divide in 5 or 10 years. The kids graduating high school this year were 8 years old when Google was started. I see kids 4 and 5 years old naturally manipulating iPhones. Many of us have persistent web connection and we like it - we feel uncomfortable without it! Of course it's nice to get off the grid sometimes but what is happening with digital technology is the great story of our age. Everything is becoming digital, addressable and connected via the web. All of us lucky enough to be working here will reap the rewards of that in the coming years because the growth of digital will far outpace the amount of talent in the workforce. We should have bigger paychecks in 5 years!
Many people focus on one particular segment of the market, whereas you seem to have a well-rounded knowledge of SEO, PPC, user experience, and conversion strategies. How did you find the time to tie all these different disciplines together?
Well, I've been at it 11 years so that accounts for the time. It is corny but I love the web and I am passionate about trying to make it more relevant to everything we do. Looking back my career path from Site>Email>SEO>UX>SEM>LPO>Display, it seems like a very natural progression to me. Basically, with one stop for UX I have just been a marketer trying to stay ahead of the advances in marketing technology. Also, I love learning how people use the web and all the disciplines I have worked in are fundamentally rooted in the same thing -- understanding people's goals and optimizing the delivery and presentation of information to meet those goals. As an industry we tend to divide the web into vectors but we often lose sight that the web experience for people is linear. The more holistic understanding we have generally the better our results.