Fascinating World of Online Marketing and Its Love-Hate Relationship with Google

My site designer arranged a meeting for me with a famous internet marketing guru earlier today to discuss the marketing plan for daytradingbias.com. It was a very interesting meeting and I learned a lot about the online marketing world. More interesting, however, is the fascinating relationship between Google and its advertisement clients. It is something worth pondering about, especially by traders and investors.

Conflict of Interest

Google, being the dominating search service on the net and mobile devices, has controlled how majority of the websites are designed. I used the word control because knowledgeable web designers would make sure the websites and the contents are presented in a way that Google bots would easily pick up the information. Business owners hire SEO (search engine optimization) experts to make sure their websites look more relevant than their competitors in Google search. A huge industry specialized in helping websites to rank higher in Google search exists because Google has a near monopoly.

But there is a problem. Google also presents advertisements next to its search results. It sells advertising space to those who want to show up on the search results page without their websites being relevant to the search. As long as you are willing to pay, your advertisements get the chance to show up on the first page of the search results. Google even publishes statistics on the click thru rate (CTR) on these ads based on their positions listed on the search result pages. Google forces the businesses that want to ensure their presence in the top spots to compete for them with top dollars. The top spots for trading related terms like day trading and emini trading can go higher than $30 per click.

To summarize what I wrote above, Google effectively monopolized the online advertising world because they have the ability to show advertisements the moment a user wanted an answer most – the time they google for answers on the net.

Competition In A Cage

The internet guru told me that if I want to show up at the top spots (or just somewhere on the first page of search results) for anything near the trading related keywords, I will have to be prepared with a budget like the major brokerages. First, I am not prepared to fight face to face against the big brokerages in marketing. Second, it makes no sense to do that unless I am running a brokerage. I asked if there are other solutions.

What about being good with what I offer? How about having great content in my website (as I read everywhere that it counts)? The answer is no. I was told if I want to show up at higher rank, SEO won’t help because my competitors will out do me every time as they are willing to put in more resources (i.e. money).

What it really means is that Google has pitted its advertising clients, especially those who have money, against themselves because it has near monopoly. This strategy hyper-inflate the earnings of Google as normal businesses have to pay up or shut up. This is not a healthy marketplace.

It implies Google’s earning is a mirage. It will last only if no one can divert traffic from them.

The Marketing Rebels and Social Networks

Here I learned a fascinating story of internet marketing rebels.

Some people who started early with their online marketing career quite a number of years ago, get to gather many personal information from their clients, blog readers and associates. These people, no longer waste time to rank their websites higher nor do they spend money on Google advertisements. Instead, they rely on two things they have built over the years. First, they have huge list of people who are interested in their services. Second, they have huge audience following them through their websites, blogs and social network presence.

These individuals are now marketing powerhouses. They are like celebrities who can drive internet traffic to pretty much anywhere.  They now offer their channels directly to major brands for presence on their websites. They are eating away the core money making power of Google.

The rise of social networks also helped the growth of mini marketing stars. They are not as powerful as those I described above who can command millions of readers to pay attention to certain things. But they are a force, in aggregation, chipping away Google’s dominance.

Google Did What It Must to Survive

This is why Google uses its predatory power to create Google+ and paid a high price to buy YouTube outright. This is also why Google has to give out Android for free so that mobile phones are built around it. Google’s survival depends on its ability to keep its dominance on the front line of search and the all precious first reach to the end users.

The moment Google cannot keep its grip tightly on its advertisers, Google’s earning will fall off a cliff. It does not imply Google will lose money though. Just that Google may have to settle for being able to stay profitable with limited growth.

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