All Hail the New Marketing Overlord: Google!
As others have noted, if you think back on the fantasies of past civilizations you’ll find that most of them have become a reality in one way or another. The crystal ball that would show events in far away lands is cable news; the spherical shape was changed to accommodate the crawl at the bottom of the screen. The magic carpet once lusted for is, of course, now an airliner (the modern version is better, you get a free soda). Who could forget the horn that took down the walls of Jericho? Any country with nuclear weapons can not only take down city walls, it can also simultaneously smite enemies inside.
There is at least one ancient dream that is on the precipice of blossoming into reality: the ancient idea of an all-knowing oracle. In the past, kings and rulers yearned for an oracle to free them from the burdens of onerous leadership decisions. The idea was that one could ask the oracle anything at all and receive the correct answer. The formula for converting cubits to meters? The oracle knew. How would the subjects react to yet another tax increase so you could gild your favorite horse in pure platinum? The oracle understood all the implications. What is going to be the modern version of the oracle? Why, Google of course. Before you think “damn, this guy found a search engine and the internet, welcome to the last ten years!” there is more to it than that, at least there will be….
If Gbuy takes off
This is the most opportune moment to survey what Google will know about you and your habits. First Google will know what you are searching for, the company will know what your email says, what ads entice you into clicking and finally, to top all of it off, the company will know what you actually end up buying.
Taken separately, none of this is a big deal. Knowing what people are searching and serving up related ads is no reason for alarm. Scanning your e-mail and catching keywords like “mesothelioma lawyer” and displaying a related snippet in the margin is nothing to be concerned about. And, naturally, merely powering the actual transaction with Google is the smallest of matters.
The potentially troubling thing is that all that information is in the hands of one company. In the good old days, it wouldn’t matter. The sheer vastness of the data would prevent anyone from doing anything with it. Thing is that Google has a lot of computers and computers are very good at just this sort of task. A few algorithms and a couple of clock cycles later Google will know exactly what pushes your buttons. The company will know the wording that makes you buy something, where the ad should be placed to entice you into to purchasing and the price point you are willing to accept for an internet purchase.
Google will have all the info, but it will take marketers some time to digest. First they will focus on the most obvious ways to increase sales, but since a computer can sort like a warehouse full of Kelly temps hopped on twenty kilos of pure Columbian cocaine, they’ll soon stop just going after the low hanging fruit and hit any particular user with the ad that is likely to get the most response. Imagine, if you will, a plethora of ads for the same good or service each one tweaked to appeal to a different user.
The beauty of the situation from Google’s perspective is that all that information is given up voluntarily. The search engine prevailed by generating the best results with minimal interference of advertising. People flocked to G-Mail in droves to the point of individuals buying free invitations on for real money on eBay. The ads you click on, the products you actually buy all add up to the kind of information marketers will pay long green to get a chance to play with. The whole thing is a veritable cash bonanza for the fine individuals at Google.
And thus, by leveraging information freely given to them, Google will go from being the king of internet searches to a modern all knowing oracle of marketing. Bring on the offerings subservient retailers, Google has all the answers!
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The magic carpet once lusted for is, of course, now an airliner (the modern version is better, you get a free soda).
And what’s more, there’s less chance of falling off. (But nobody ever envisaged magic carpets as massively polluting.)
Google will know exactly what pushes your buttons. The company will know the wording that makes you buy something, where the ad should be placed to entice you into to purchasing and the price point you are willing to accept for an internet purchase.
Unless people don’t buy things because of advertising but because of the actual details of the actual products. Which they don’t, but some of us try to!
This is a great article Chris, really nicely thought out.
But Google is not merely about providing “all the answers” to companies, although as you say their information about consumer behaviour puts them in an unprecedented position from which to do so. Customer reviews are a very important part of Froogle, for instance, which shows they also have commitment to providing us with information about the quality of the products themselves.
From my standpoint it seems that Google’s ambition is to make the marketplace generally more enlightened - so companies have more knowledge of their demographic, but also consumers have easier than ever ways of judging the actual quality of a product.
In such a system, the onus on the industry is not just to produce effective marketing, but also to produce great products.
I agree that I found this article very interesting and thought provoking.
I think that I do more internet shopping than the average person and that I buy a lot more big ticket items than the average internet shopper. I really would not have a problem with Google tailoring the advertising that I see to the products and services that I might actually be interested in. But, I agree with Ben that it is not the advertising that makes me buy something. I do a lot of research on the product and, if I am unfamiliar with the company, even more research on the vendor I purchase from.
If anything, this new and improved Google would just be a higher tech version of information broker for targeted marketing.
Ar, an oracle for both sides, if you will. (“Information broker” is a very good way of putting it.)
If I may tangentally offer another similar “future” scenario:
Look at the iTunes Music [soon Movie] Store, the same Bayesian algorithmic techniques can also be applied there. Apple knows your personal information down to what counts - your credit/debit card.
Apple can sift the impending torrent of potential revenue streams (targeted ads?) based on your one-click purchases? I know embedded ads in iTunes is cardinal sin, but have you noticed iTunes recent makeover? Since version 4, iTunes has become a self-advertising medium for Apple and this will even go further with the proposed Movie content downloads.
So, in the above situation, Apple “logs” your purchases, what genre, what time of day, how often, what prices, clicked on a image or text, and on and on. Data warehousing is my specialty. I develop database applications from SQL Server, Filemaker, to MySQL.
Anyway, when I say Apple can frisk and sift your iTMS actions, I am not kidding. Any web-enabled database systems - Google, eBay, Yahoo! - all can do this. The only thing that makes Google stand-out is how they have created [and I believe, patented] Bayesian data warehousing algorithms that no other can match.
But I fully believe that Apple has the talents and creative imaginations to pull-off same exact feat with iTMS data warehousing algorithms - Bayesian or not…
Nice article and thought-provoking ideas Chris.
The only thing that makes Google stand-out is how they have created [and I believe, patented] Bayesian data warehousing algorithms that no other can match.
I don’t think this is what makes Google stand out. I would seriously doubt that “no other can match” their ability to glean trends from data, however good they are. Google do not have all the intellectual heavyweights in the business. Instead what puts them in their position of privilege is their monopoly on internet search, which makes them the principal gate-keeper to the services and information on the internet for most users.
And being the principal gatekeeper, they have the advantage that their data sifting is on a larger base of users than anyone else’s, meaning that from Company X’s point of view, they are the most inviting data sifter out there.
I agree that the article is thought-provoking, which makes it stand out. However, it’s not entirely correct. First, Google’s services are voluntary. It’s hard to be an overlord of anything when your subjects have to volunteer to be subjects and can quit the kingdom at any time. There’s tons of folks who won’t use G-Mail.
Second, Google doesn’t know anything about individuals as a result of its analysis. All it knows is what G-mail account does and serves up ads in reaction to that. I don’t know of any uniquely identifying information that is stored upon individuals that Google uses.
Third, Google’s star is dimming. Look at the China search fiasco. Remember the news fiasco, where Google chooses some news sources as being more reputable than others? One of those news sources is the state-run news organ of the Chinese communist government, interestingly enough. And don’t forget the whole ad topic banning thing.
Also, Google doesn’t have a monopoly on internet search. If they did, there wouldn’t be any other search engines out there.
If those “golden” Bayesian algorithms are patented - let say for arguments sake - will be a steep ocean cliff to climb for any ambitious startup or even M$ or Yahoo!.
I am not insinuating that Google have ALL the most talented people, just have some of the most talented and creative to boot!
As to Google having a “monopoly” status on search, I would not dare walk on such a rocky claim at this point. They have a huge dominant share but can change in a matter of eyeballs and public perception [look at Netscape’s meteoric rise and fall for that proof]. But don’t debate me on Netscape’s behalf, it is a dead horse out there on the internet’s wasteland.
I only meant monopoly in the sense that they currently have the vast majority of the market and MS/Yahoo don’t seem to be able to do anything about that, try as they might.
Google doesn’t have a monopoly on internet search. If they did, there wouldn’t be any other search engines out there.—Aurora77
Yes, in just the same way that there aren’t any other operating systems “out there” than Windows… Are you going to tell me that Windows isn’t a monopoly?
So in a way what I contend is that the title of “Information Broker” or “21st Century Oracle” simply goes to whoever has the largest slice of the internet information pie.
If those “golden” Bayesian algorithms are patented - let say for arguments sake - will be a steep ocean cliff to climb for any ambitious startup or even M$ or Yahoo!.
If those same algorithms are an obvious solution, and so alternatives cannot be found, then they will not constitute a very great legal challenge to others providing alternatives.
At least, if the situation is as you describe - and no-one can emulate Google’s algorithm lovin’ - then Google must certainly be a monopoly as nobody else will be able to play the game in anything like the same way. It seems when you say Google has a huge dominant share but can change in a matter of eyeballs and public perception you are implicitly accepting my contention that Google’s success and special position among similar firms is not based on its Magical Data-Sifting Abilities as you originally said, but on its majority installed user base.
...you are implicitly accepting my contention that Google’s success and special position among similar firms is not based on its Magical Data-Sifting Abilities as you originally said, but on its majority installed user base. -Ben
Implicitly - yes. Explicitly - No. For a reason, they did not get to where they’re at (dominant status) because they had a large user base. They got to be Google because of the “sifting” statistical Bayesian algorithms that its founders - Brin and Page invented back in college. It is that “magic” that made Google, well, Google. Not because they instantly blessed with a googleplex numbers of users which you are explicitly stating. It is a case of the “chicken & the egg” and G is the golden egg, Ben.
We’re not talking about how google came to prominence, we’re talking about whether Google’s algorithms in and of themselves will make it the most successful provider of information services in the future, which (unless I have misunderstood) is what you opined when you said:
The only thing that makes Google stand-out is how they have created [and I believe, patented] Bayesian data warehousing algorithms that no other can match.
Or, on the other hand, will Google’s current No.1 status be the main deciding factor in whether it wins the war for Information Oracle status as described in this article?
i.e. “What makes Google stand out” in the current market is either 1. large user base or 2. unmatched algorithms.
Saying “the only thing that makes Google stand out” is #2 (algorithmic superiority) is a view inherently incompatible with then saying that “eyeballs and public perception” might easily cause sea-change.
Additionally accepting point 2 (unmatchable algorithms “only” reason for outstanding success) contradicts fear and loathing of the idea that Google is a monopoly. Because if no-one else can produce the same functionality, then a monopoly they are and a monopoly they shall remain.
(One could make an argument that Google’s initial success is through blind-siding the opposition - MS is NO WAY clever enough to have thought 10 years ago that it would now be battling fiercely over SEARCH of all things! Google came in with a great, simple product in an under-respected field and came to no. 1 position. But the situation is different now. There is real competition. Marquez ces mots ici, with well-funded rivals with the avowed intent to out-do Google, “magic” will not be enough.)
A question… Are we hell-bent for the end of privacy? It seems to me that there is less and less privacy for private individuals. We are watched by traffic and security cameras, our text messages are logged, archived and are retrievable by police (i hear sharp intakes of breath in response to this but its true), our phone companies know who we phoned, who called us and how long we spoke for… Our supermarkets know what we buy and how often… And if that is not enough, our prospective employers can google us - and in many cases, read all about our lives via our own blogs…
But is this a bad thing? Only if we conceal aspects of our personalities or our lives. We are experts in hypocrisy - we say one thing but think and do another.
I watched, with fascination, on TV last week as a reporter investigated four technologies which are designed to spot when someone lies. The traditional polygraph has been overtaken by new technologies which track facial temperature variations, or micro-expressions to spot when someone is lying - with some accuracy it seems.
I suspect that today’s teenagers are learning to live a much more open life. They seem to have much less concern about what other people think, and how much of themselves they reveal.
Hands up those who find this terrifying? Well I suspect that you are going to have to get used to it… It won’t only be Google that knows everything there is to know about your personal habits!
...alternatives cannot be found, then they will not constitute a very great legal challenge to others providing alternatives. -Ben
Oh, there are many alternatives. Chief among are Yahoo! at around 20% share, M$N at 14%, and many aspiring upstarts taking the crumbs.
Whether those runner-ups will be able to break the big G’s hold on net users’ mindshares is another matter. Overall, the big G’s dominant position in net search is presently not considered a monopoly. Like Apple in its portable media content distribution and player business, just having a dominant market share does not directly translate into a monopoly status.
Another, although it was the simplicity of the portal page and the “magic” of their analytical algorithms that got them to the present. They must not count on those alone moving forward for the internet battlefield is dynamic. That dynamicism of the net that confounds many to falter or fail completely. M$ is a principal example. Google and Yahoo! are just too mobile for them to figure out.
When M$N finally comes out with a product (Windows Live Search, mapping, 2GB storage emails, for instance) they are constantly late in delivery and most important - a me-too kind of “innovations”.
Saying “the only thing that makes Google stand out” is #2 (algorithmic superiority) is a view inherently incompatible with then saying that “eyeballs and public perception” might easily cause sea-change. -Ben
Not necessarily. Your #1 [large user base] is a byproduct of #2 having [algorithmic superiority]. Although most users say they “love” the simplicity of the main portal page and they swear for its superior feedback system measured in microseconds, they are indirectly referring to #2. And due to #2’s superiority over competitors, you end up having #1. How can that mutual dependence be an incompatibility?
So, now we play “what-if”. What if that massive customer base called “eyeballs” starts to twitch and take glances on other, more efficient, and better feedback search systems? The market-share meltdown scenario will then proceed in earnest.
The “magic” and the great Bayesian algorithms that is Google will not be able to contain such massive outflows. So, why would anyone claim that Google have this “monopoly” on “eyeballs” then? That is pure nonsense. Anyone can go to Y! or WL$ and get a relatively identical search result. We elect to use Google because at this very moment they have the best, snappiest feedback, simplest search system out there and not because they “locked” me into their portal.
As for the prediction in this article declaring the ultimate net oracle will be Google is flawed. Google may have the largest-ever collection of data-sniffing server farms all over the globe but it will not contain all of the internet’s meta information. Never.
It will be entirely and completely different animal uncontained by one controlling for-profit entity.
It will be called the Semantic Web. Look it up.
Personally I think putting too much trust in the Semantic Web to OMG CHANGE THINGS 4EVA!!11!!!!1! will probably turn out to be a bit naive. For one thing, there is a good deal of criticism floating around about this idea. But more importantly, there is APATHY. Nothing’s happening! I read about the nascent idea more than 5 years ago in a really crappy book about the history of technology and was like ‘ooh agents kewl’, but the reality is that we’re no closer to making the semantic web happen now than we were then. And we’re not even visibly moving in that direction, to my perhaps myopic eyes.
BUT… It is my view that a semantic webby situation could actually be of two sorts.
Firstly, as envisioned by the luminaries, where the actual content of the web is structured and ‘labelled’ for digestion by computer software often called “agents” running on our PCs that automate and therefore simplify the process of finding information on the web.
Secondly, by specialised computer centres doing the heavy trawling for us, that is, the agents are not run by everyday users, replacing normal browsers, but by certain companies with internet front-ends that allow you to access the automated, simplified services provided by their specialised agents.
You might guess what I’m getting at here. The second situation is one that is exactly what we’re seeing today, albeit in a way that is immature. The agents are your hallowed “bayesian algorithms” and the ‘certain companies’ are the ones we call google and yahoo and vole…
I really don’t agree that the idea that Google is the Information Oracle is flawed. I do agree it’s possibly overstated, of course. I don’t think Google will reign supreme and eventually become Central Earth Authority. But the article leads me to a more general point - I think that the companies that act as our GATEWAY to the informationzz on the internet will provide your “semantic web”, in the same sorts of ways that they have been doing for the past N years, only better, with more integration between their disparate “agents”, and with ever-more complexly intelligent algorithms.
The agents are your hallowed “bayesian algorithms” and the ‘certain companies’ are the ones we call google and yahoo and vole… -Ben
Yes, in the immature state of the semantic web, you are right these so called agents are represented right now as “for-profit” companies as G, Y!, and Vole.
The semantic web is ongoing and no one is exactly sure when it will be in its full implementations. Web 2.0 is a start, Web 3.0 is the finish? No one really knows. Not even Tim Berners-Lee who proposed the basic idea many net eons ago.
I really don’t agree that the idea that Google is the Information Oracle is flawed. -Ben
Your reservation is your privilege, Ben. I will not debate that. But even Google many years from now they will not be able to handle the total weight of the internet for the net’s expansion rate is many factor faster than the expansion of G’s server farm capacities.
So, my technical point that G will not be the “all knowing” oracle of the net is technically flawed. Generalizing the idea of this article, G gets very, very close to being one. Thanks to those “hallowed” Bayesian algorithms.