On a recent Backwards Gang episode of the Gillmor Gang (hard to tell which one eh?), Jason argues about AdSense being more like Direct Marketing and that it will be the incumbent form of marketing for next few decades. He also touches upon the YouTube/AdSense relationship at his blog
Well, he’s partially right but he’s missing one important part of the recipe.

I agree that AdSense is more like Direct Marketing than advertising and  it’s way more efficient than prior forms af advertising given that it’s pay-per-click.
The important piece of the puzzle that Jason is missing is the quality list, something of a cornerstone for Direct Mail or Email advertising.
A better list is a better open-rate, and a bigger ROI.

The fact that AdSense is only contextual is a shortcoming, and for both Google and the advertisers, making it more efficient will make more money for each respectively.

Despite it being pay-per-click, more click-throughs mean more revenue for both Google and the advertiser.

Where is the quality list in AdSense?

You could argue that it’s in the context of the web page, but this is only superficially true.

To rev things up, or “press on the gas,” as Jason would say, a bit of behavioral targeting needs to be added to the mix.

Get more of these ads in front of people who really want them, or are at a particular point of the buying cycle and your CTRs will go up, and revenue will follow.

This can all work in conjunction with contextual data, but will enhance contextual delivery immensely.

So while I agree with Jason’s prediction that AdSense will dominate for years to come, I think Google must improve upon it, or else risk losing marketshare to a behaviorally enhanced version of adsense that may provide a similar ROI, but in a condensed amount of time, which equates to money.

If Jason thinks that Google will rise to Microsoft levels of dominance in this space, they are going to have to address the quality list or lead, in this case, by the use of behavioral targeting.

I think they will. In fact, I think  it will be an integral part of their Cost-Per-Action experimentation that began when the rumblings about click-fraud were at a peak.

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Interesting article. I’d read the whole thing.

In short, a bunch of anonymous claims that online folks should have a greater leadership role in newspaper organizations.

They are speaking mostly of editorial, but I’d say it’s even more important for the business/strategy side to be run by folks who grasp the technology. After all, if you don’t understand something like RSS, how can you envision using it to make money, or even realize it’s the most important initiative we have in front of us. There is no getting around the fact that we are managing a software product.

Like Gretzky said, “I skate to where the puck is going to be, not where it has been.”

On a more immediate note, the article touches upon something I’ve been debating for a while.

“. . .We live in a Google economy, where a wealth of news and information is at our fingertips. There’s simply too much available, so easily and free, for it to make sense for most news companies to charge for most of their content. ”

Which makes me think, I strongly believe that if every article newspapers ever published online was still available at it’s original location, their monthly traffic would be double what it is today. Maybe more.

I see no reason why ad programs like Google would not scale monetarily with traffic, which means they’d probably be  bringing in double  the amount of revenue from those programs.

Which leads to the question of whether  that sum would be  greater than the potential sum of sold archives. I think it would be, but time will tell.

In addition, there is the unmeasurable other 99.99% of the visitors to those pages that won’t click a google ad, but appreciate our content being available.

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Speaking of CPA advertising, I haven’t heard anyone talk about a hybrid, in which the advertisers pays a lower amount for impressions or clicks and a bonus for an acquisition.

For example, I’ll pay you a small amount to run my conference ad on your site and give you a nice bonus for all conference signups you send me from  those ads.
Salespeople work on a bonus system, why not sales algorithms?

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