Jigantus.com

The e-commerce environment is, in many respects, simply a new geography for the market economy and for this new market economy to take root firmly it has to overcome the same institutional obstacles as the offline economy Key among these is trust.

• Secure check out
• Phone number
• Address
• Written policies including a friendly return policy
• Trust seals

I like reading Techcrunch articles because they seem to be on the pulse. I read one today that Google is tweaking their Adword system to recognize quality more.

Google Tweaks AdWords To Reward “Quality” (And Juice Revenues)

In it they talk about the Adwords Blog:

To appear above the search results, ads must meet a certain quality threshold. In the past, if the ad with the highest Adrank did not meet the quality threshold, we may not have shown any ads above the search results. With this update, we’ll allow an ad that meets the quality threshold to appear above the search results even if it has to jump over other ads to do so. For instance, suppose the ad in position 1 on the right side of the page doesn’t have a high enough Quality Score to appear above the search results, but the ad in position 2 does. It’s now possible for the number 2 ad to jump over the number 1 ad and appear above the search results. This change ensures that quality plays an even more important role in determining the ads that show in those prominent positions.

What I see here is that Google is making it easier for Ads that “meet” the quality score to be displayed in the top section of their web site above the organic search results. In the past, it used to be a combination of quality and bidding. If the bid was high enough it would make it. Sometimes no ads would show on the top, all the way up to 3.

As most marketers know, the most clicks happen on the top results, with less on the side. So by allowing more ads to be placed on the top, more clicks will happen resulting in more revenue for Google.

While increasing quality content is always a good thing, ads are not really considered content per say. Because the move increase revenue to Google, its good intention seems to be diluted by the revenue grab.

Ultimately the market will decide. PPC advertising is extremely competitive, with advertisers struggling to find the fine line between winning and losing. This will make it even harder.

In the past model, advertisers that had good quality ads but didn’t want the “looky loo” traffic, could strategically place themselves on the side ads on Google. This would result in “filtered” traffic, customers who actually wanted to click on the ad because they sought it out.

In the new model, advertisers thrust to the top will see increased spending due to the additional “looky loo” traffic, traffic that won’t convert as easily.

The market will have to adjust, but I see it as another squeeze on a PPC model that will be difficult to maintain in the long run.

According to Wikipedia:

“An economy is the realized social system of production, exchange, distribution, and consumption of goods and services of a country or other area. A given economy is the end result of a process that involves its technological evolution, civilization’s history and social organization, as well as its geography, resource endowment, and ecology, among other factors. ”

Economies are often referred to when you talk about Countries, but in fact the web has become an economy of its own, with certain sites providing further sub economies.

Let’s put it to the test and look at EBay. EBay has a system of production (third party applications), exchange, distribution, and consumption of goods. It has technological evolution, social organization (feedback system, discussion boards, EBay etiqutte, cult following) and geography (wordlwide) . Third party developers building applications for EBay users like Esnipe, Paypal, and other marketing tools can be argued as using “code resources” to fuel the economy.

EBay is not selling goods, it makes money from fees and services, (much like a government tax) and puts it back into making improvements for it’s new economy. The environment it has created, the eco system, allows the economy to thrive. EBay must nurture, care and continue to improve the economy, or it goes down.

Other sites like Facebook and MySpace, are growing to become economies as well. Originally started as a social network, the environment being created motivates third party developers to build applications to service users thus promoting commerce.

Craigslist has tapped into the exchange of goods, services and social exchanges between local people.

Amazon.com , Buy.com have also created a system that allows third party sellers to sell on their web sites. They no longer sell just direct.

Second Life, a virtual reality game takes it a step further where it has created a fictitious world where real people play their self developed characters and pay real money for fake land, goods or services created by other virtual people. In fact real life companies create a presence in this system to market their goods outside the real world.

The Internet has allowed businesses to create new economies that are fostered and promoted inside each URL. Jignatus.com hopes to be one of those new economies.

Of course, we still have to live in the “real” economy, the one where we have a physical place to live, but what a powerful place the web has become.

I recently read an article on improvements to Google Analytics tools on Techcrunch. There are a number of changes that will improve an advertisers understanding of their customer. This will help advertisers more efficiently focus their ad dollars, and help Google squeeze more out of their ad model.

With all the articles I am reading right now, everything tells us that the whole world is in uncertain times. The economy is contracting, people are being laid off.

I hear about Venture Capital companies telling their partners to conserve cash, as it will be difficult to raise future funds. So more layoffs happen, and VC’s get less money to invest or invest in later stage companies.

How I see it is this is an opportunity. An opportunity for businesses to grow lean and mean right from the bottom up. Only spend a dollar if it makes sense and not a penny more. My businesses were all grown with this in mind and have helped me be profitable from day 1 with minimal cash outlay. Jigantus.com will be the same way. If we build from the ground up with this in mind, we will outlast anyone.

With less being funded out there and others cowering in a corner, we go forth and build something that makes sense, is useful and beneficial to all. I see it as a time to gain on the competition.

Onwards.

Pay Per Click advertising is a huge business, generating billions for the online ad market. Below is a chart from Lehman Brothers, notice “Search Advertising” is the largest form of revenue right now at over $11 billion in revenue. 

Projected Online Ad Revenue

Google recently announced (Sept. 16, 2008) that they would have a new judging system for AdWords. AdWords of course, is their PPC (Pay Per Click) system that generates them billions in annual revenue.

Google changed the way they calculate the Quality Score and that they will analyze the landing page less frequently then before. They are also opening up ALL keywords for bidding, whereas in the past they restricted it to more “active” keywords.

The most significant change was that they are now replacing what used to be “minimum bid” prices, with “first page bid estimates” which will likely result in higher prices as lack of clarity on bid position and will “force” uneducated bidders to run the bids up.

It will take some time to see the impact as advertisers absorb the changes. However, this is an example of how Google is squeezing everything it can out of PPC. PPC is a great tool to generate traffic to your web site, but only a few businesses can make it. These changes will make it even harder.

As someone who advertises heavily using PPC (Pay Per Click Advertising), I would consider myself an expert. I’ve used Google, Yahoo, MSN to name the major ones in my past and present.

If you are not familiar with PPC, it is essentially like this. A whole bunch of advertisers BID for the position of their ads when a key word is searched on a search engine. Meaning the higher you bid, the higher placement you will receive and the more traffic you will get (higher placement attracts more clicks and thus more traffic).

It is highly targeted and seemingly cost efficient, because you don’t pay unless someone clicks on your highly targeted ad.

You can further control how these ads are placed by limiting your bid, daily spend, time of day, geographic territory and what sites it may show up on.

PPC advertising is great because it allows even small businesses to instantly gain traffic on a limited budget. If you aren’t sure how to do this or don’t have time, go to any search engine and type in PPC, you will find a range of services of companies that have popped up to manage PPC.

PPC has become a huge industry, it’s main players are companies like Google (Ad Words), Yahoo (Search Marketing) and MSN (Microsoft Ad Center) and is a major source of revenue.

The World Turns on PPC, but as we know, the world is not perfect. More to come.

In case you’re wondering, Jigantus.com is taken from the term “Gigantic”. From the dictionary:

 ”enormous, immense, prodigious, herculean, cyclopean, titanic. Gigantic, colossal, mammoth, monstrous are used of whatever is physically or metaphorically of great magnitude. Gigantic refers to the size of a giant, or to size or scope befitting a giant: “

We want to be the biggest and the best!

I am a successful entrepreneur with experience in online marketing and e-commerce strategies. I have spent millions of dollars in online advertising and served over 100,000 customers.

I am in the process of developing the “next big thing” on the internet. The plan is to do something better then was done before.

Keep checking back!