What is the Point of this Article?
If you’ve paid any attention to SEO over recent years, you probably know that:
- People figure out tricks to game the system to rank their websites.
- Google updates the algorithm periodically to undo ways of gaming the system that become really popular,.and occasionally deranks huge numbers of sites overnight.
And you’ve probably heard from some:
- There are tricks that work reliably if only you know them (generally for a fee you can learn them).
- Google penalizes/punishes websites who (in their eyes) game the system.
- Google unfairly prioritizes their own products and services in their rankings.
- And more….
However, when you understand what the business model of Google is, which is to say how they make money, you realize that while there might be small grains of truth in the negative things people say about Google’s search algorithm, most of it is bullshit.
Please read on, and take your time, as I start at the 50,000 foot level, at a time before Google even existed. This is because Google’s business model is not new. What’s new is how they do it.
Advertising as a Business Model
Many people, when they consume some form of advertising supported content (TV, radio, whatever), like to think of themselves as “the customer” as they think of themselves as “consuming” the programming.
But think for a minute how the money flows. When we enjoy advertising supported content, we’re not paying for it, the advertisers are. That clearly makes them the “customer”, and the station selling to the advertising is the “supplier”.
But if the advertiser is the customer, and the station is the supplier, what are we?
We, my dear friends, are the product, or more specifically the advertisers pay the stations in order to have access to our attention, which they wish to use to sell us stuff.
A law professor at Columbia University named Tim Wu coined the very apt phrase The Attention Merchants. He has written a book titled The Attention Merchants (see image), and in the spirit of full disclosure I wish to state that while it is on my reading list, I have not yet read it. But I get the idea, as I’m sure you do too.
Attention merchants are the people who get our attention via various means, then sell it to others who want to sell us products and services.
The idea is almost 100 years old, with the first radio commercial airing in August of 1922.
The commercials interruptions we’ve all come to hate started as the means of covering the costs of building out radio transmission facilities. Later the idea was expanded to broadcast TV. Even cable TV without commercials didn’t last long. Commercials proved not only to be a good way to cover costs, but to make some serious money as well.
Then the Internet happened, and search engines starting offering us their services so we could better find interesting stuff.
Then in 1996 a student at Stanford named Larry Page started working on a research project exploring the mathematical properties of the link structure of the World WIde Web. Shortly later his friend Sergey Brin joined him in this project.
They realized that using web links as “votes of confidence” in order to calculate the “value” of a web page produced really good search results. This is very similar to the way academic papers cite each other, and I’ve often wondered if Larry Page used that as his model.
Anyway, a research project named “BackRub” became a company named “Google”, and the rest is history.
Google vs Others
The basic business model of Google is just like that of radio and TV stations. Get our attention, and sell it to advertisers. The radio and TV stations do it with programming. Either by creating shows people want to listen to and watch, or by buying shows others have created.
Google gets our attention by showing us search results we find useful, but from that point on, the business model is the same. Now that Google has our attention, it’s theirs to sell.
While it’s true that Google is “just” another attention merchant, they are also one of the most successful attention merchants in the history of human civilization, if not THE most successful.
Now let’s review some statistics on advertising spending worldwide and in the US.
2016 Total Global Advertising Spending: $493 Billion
2016 Total US TV Advertising Spending: $72 Billion
2016 Total US Radio Advertising Spending: $17.7 Billion
2016 Facebook Advertising Revenue: $26.9 Billion
2016 Google Advertising Revenue: $79.4 Billion (page 24)
Now let’s run a few ratios, shall we. In 2016…
- Google took in slightly more ad revenue in 2016 than the entire US based television industry.
- Google took in almost 4 ½ times as much ad revenue in 2016 as the entire US based radio industry.
- Google took in almost 3 times as much ad revenue in 2016 as the other online heavy hitter of ad sales, which is Facebook.
- In 2016 Google took in 16.2% of all advertising spending, worldwide.
Let that last one sink in. One company took in ALMOST ONE SIXTH of all advertising money spent in the ENTIRE WORLD in 2016.
What Google Does the Same
Google is very good at getting our attention, then selling that attention to people who want to sell us stuff. Every advertising supported business does this. If they don’t do it, they go out of business.
What Google Does Different
Google does not generate any significant content. The only content Google produces is documents they publish on their websites, just like everyone else. Whereas most advertising based business are built on either producing content for their audience, or buying content produced by others, Google aggregates content produced by others and presents it to people in search results. That is a very significant difference.
Again, What is the Point of this Article?
Now that you understand what business Google is in (and how important this business model is to them), you have a perspective with which to understand why Google continuously updates their search algorithm.
In order for Google to continue to be paid by advertisers, they’ve got to keep our attention. In order for Google to continue to keep our attention, they’ve got to keep providing us with search results we find helpful. By continuously improving the quality of the search results over time, they further cement our collective thinking that Google is synonymous with Search.
When you look at what they do from that perspective, all their efforts to prevent people from gaming the system and their constant updating of their search algorithm suddenly makes sense.
The more we like their search results, the more we use Google, and the more money they make.
So what does Google call their efforts to keep us coming back for more?
They call it Quality, or more specifically Search Result Quality.
If you want your website (or websites of your clients) to rank higher, you MUST understand how Google defines search result quality.
Search Result Quality
To learn how Google defines Search Result Quality, read part 2 of this blog post on Organic Growth, which is titled
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