This article combines two reports written by my students after going over the Standard/Poynter Eye-Tracking Project’s results posted here: http://www.poynterextra.org/et/i.htm

Stanford/Poynter Eye-Tracking Project

In 2000, Marion Lewenstein (Professor of Communication, at Stanford University) and the Poynter Institute researchers initiated the Stanford/Poynter Eye-Tracking project on online news reading behavior. It was the first project to introduce the idea of using eye-tracking equipment (SMI Eyelink system) to measure the eye movement over areas on a computer screen in conjunction with the application software for collection and analysis of observational data, which was written by the Advanced Eye Interpretation Project at Stanford University.

There were 67 subjects (with only 66 subjects’ data used, one was discarded because of unreadability) enrolled from two cities, from the states of Florida and Illinois. All participants were set up with head gear that recorded eye movement data while they read online news web pages. The research team collected images 60 times per second, and recorded each fixation point, the length of time for each fixation, and the order in which each fixation was generated.

The results of this study surprised many people in the industry. In fact, one of the findings was that a large percentage of the study participants look first to text, especially for news briefs and captions, which was just the opposite of the generally accepted notion that graphics and photos represent the first entry point for readers.

Other findings of the study are highlighted here:

Text Attracts Attention Before Graphics:
Of users’ first three eye-fixations on a page, only 22% were on graphics, and 78% were on text. In general, users were first drawn to headlines, article summaries, and captions.

Banner ads fared quite well.
Banner ads indeed did catch online readers’ attention — a notion that went against current thinking. 45 percent of banner ads were viewed by test subjects and the average fixation period was 1 second. This time is long enough for readers to perceive the banner’s message.

Online news users “do know how to scroll”
For articles on a news site, if a Web user has clicked to get to the page, chances are high that the article will be read, because the headline or blurb that led the user to click to the page gives enough information to the user that he/she knows in advance it’s something worth reading.

Visitors do have the habit of Interlaced Browsing
Users frequently alternated between multiple sites:

• they would read something in one window

• then switch to another window and visit another site

• and then return to the first window and read some more on the first site; possibly to turn to the second window again later in the session

Insights gained from the study

Improve Headlines and Briefs
Be straightforward and efficient with headlines. Recognize that getting too cute may actually turn off online users, who just want to quickly discern if a story is worth reading.

Edit online photos and graphics
Use an appropriate photo with a single focus or single subject, or crop the image tighter to help the user focus on the main detail.

The best of both worlds
It may be necessary to deliver two versions of the story: a high-end graphically intense presentation and one that is bare-bones and designed with both wireless and low-end computers in mind.

Reconsider animated banner ads
If a banner is animated, every animation frame must have the brand name included. Not doing so can mean the consumer will look at the ad but not comprehend who placed the ad, because the average fixation period only one second.

Conclusions:

The results of this study echo what Google has experimented with on the Internet ever since it launched its Google AdWords Program (Google’s own online advertising program) by using text-based advertisements rather than graphical ones. Google’s results do indicate that the effectiveness of pay-per-click text advertisements is higher than graphical advertisements for the click-through rate because online visitors tend to read text rather than look at graphics. In my view, this can be explained by the fact that the primary motivation of people going online is to “search and collect” information, and so they tend to “read” more on this medium when compared with other medium like TV and magazines.

My challenges to the test results:

One of my criticisms is that objects in this experiment are too focused in two cities within one country, and no information on how they were recruited. The failure to achieve “random sampling” in the experiment defeats the possibility to generalize the results to the general online population.

It is suspected most of the subjects are frequent online news readers and thus already have the tendency to “read” text rather than looking at other graphical elements of a website. Therefore, the test results are not conclusive.

Tags: banner advertisements, banner advertisements Vs text advertisements, Google AdSense, text ads, banner ads Vs text ads

Technorati Tags: Stanford/Poynter Eye-Tracking Project, online news reading, banner ads, Google AdWords, text advertisements, random sampling, banner advertisements, banner advertisements Vs text advertisements, Google AdSense, text ads, banner ads Vs text ads

To SEO or to PPC?

That is the question . . .

In today’s ever-growing online marketplace, with companies constantly jockeying for top position to grab the attention of potential customers, two different methods of promoting websites have emerged: SEO and PPC.

So, what do those letters mean, and which method is best for your goals?

Search Engine Optimization (SEO)

This method works to position your website as far near the top as possible in search engine results, by embedding certain “keywords” throughout your site’s content. The presence of these keywords (words that users might type into a search engine such as Google in order to find information on a given subject) in your site is what causes search engines to find your site and list it in search results.

Many people consider the SEO tactic for web promotion to be a “free” method of bringing customers to your website, since they are not paying a fee for it. However, it’s not actually free. It takes a lot of time and effort to optimize your website and build content, and that can be very costly. You can learn more about SEO at this link:

http://www.imarketings.net/internetmarketing/category/seo/

Also, check out my e-book on this topic here:

http://www.jdcnet.com/index.php/free-ebook-download/

get-ranked-high-in-search-engines.html

Pay-Per-Click (PPC)

PPC is an advertising technique that is gaining popularity on the Internet. PPC advertising involves sponsored links that are typically in the form of text ads (appearing both in search engines’ result pages or their affiliates’ websites) and graphical ads (usually appearing in affiliate websites only). Advertisers pay per visitor who clicks on the advertising link, hence the term “pay-per-click.”

PPC is the fastest and easiest way to set up in your advertising campaign. Take Google’s popular Google AdWords program as an example. With Google AdWords, you can go to http://adwords.google.com to set up and register an account. After creating a simple text ads message for your website and choosing your targeted keywords, you are ready to start your campaign immediately.

In most pay-per-click programs, you can control the daily budget to be spent, and through the Internet, you can easily track your campaign’s effectiveness by taking measure of the visitors’ activities on your site and tracking their behaviors using website software. Google now offers a very popular free service called Google Analytics to track visitors. To access this service, simply go to http://www.google.com/analytics/indexu.html and start your online tracking.

Which method is right for you?

That depends on your goals at this point in your development.

In short term, if you are in a hurry to bring customers to your site and test the effectiveness of your newly built web page(s), go for pay-per-click. There is no easier or faster way to set up an advertising program than PPC, which you can use immediately to bring your website to millions of Internet visitors all over the world. And you can also target specific niche customers by using carefully chosen keywords, regions, and languages. But remember, it is a recurring expense that could eat up a lot of your advertising budget.

In the long run, try your best to capitalize on your efforts in using SEO techniques to build your website to receive free referral traffic from search engines. This method can be costly at the beginning, but your effort will pay off in the long run.

Tags: SEO Vs PPC

Technorati Tags: SEO, PPC, Pay-Per-Click, Google AdWords, Google Analytics, SEO Vs PPC

Google once again demonstrates its exceptionally innovative power, as we have discussed in other posts, by stunning analysts with its greater-than-expected 30% increase in its first quarter report. Google’s share price in after-hour trading jumped 17% to 525.96 last Thursday night. Again, this demonstrates how important people are, as assets of a company.

Before this news broke, analysts worried about the “paid clicks,” or the number of times users click on Google advertisements and its affiliated websites slowing down. Among these critics, the loudest warning voice came from Comscore (Nasdaq: SCOR) whose share price slipped 8% because of Google’s unexpected good news. People now question the accuracy of Comscore’s survey, on which it based its cause for worry.

Google’s explanation of its success rests on the fact that more than 50% of its business is conducted outside of the US, which it says attributes to its ability to withstand a slowdown in US economy. Google achieved more than 20% growth in clicks worldwide last quarter.

In my view, Comscore might not be wrong. The paid clicks rate has dropped overall. Google’s growth in paid clicks was 30% in Dec 2007 and 45% in the preceding quarter. Obviously, there is a trend of slowing down. But the paid-click rate represents only one factor of paid advertising. The other factor people often overlook is the price per paid click.

Google does not have a standard price list for its pay-per-click Google Adwords program. It uses an auction model to determine pricing, where advertisers bid for “keywords” they use their advertisements, that they would like to appear in Google’s search results and its affiliated websites. The more competitive a keyword is, the more expensive a click could be. With some popular keywords like “web hosting,” the charge per click could be as much as several dollars.

In my experience using Google Adwords, there is a solid growth trend in the average per-click price of keywords in the past few years. With some of the popular keywords that I use, I have noticed that the increase in price is as much as several hundred percent within a three-year time frame. It is increasingly difficult to find effective keywords that are “cheap” now.

This can be explained by the fact that more and more businesses are entering the market, using online advertising media to promote their products and services. In the past, small business owners were the major players in this market. But now more and more big guys are coming in. More competition for keywords drives up the per-click price, and that helps to compensate for the drop in growth rate of number of clicks.

And Google makes continuous efforts to combat click-frauds and click-arbitrage by some website affiliates, by refining its Google Adsense program. This effort pays off in improving the quality of leads brought to Google customers. Advertisers are more willingly to pay for the clicks if the customers are of good quality. This also explains the increase in Google’s average paid-click price.

In my view, the recent setbacks of Google’s share price are largely due to the general market sentiment. Google’s value is not totally reflected in its current share price.

To invest in a company, you need to consider the market, the industry, and the company’s management. As far as the industry goes, the online advertising industry is still budding and there is a lot of room to grow. As for the company, I always opt for Google’s exceptional management team that can attract and retain smart people to knock down its competitors (read my post about Microsoft Acquires Yahoo!). And with its ability to withstand the recession in the US economy (as proven by its first quarter results), it seems that Google is very likely to keep its momentum going in the coming years.

Tags: Google first quarter results

Technorati Tags: Google, Comscore, paid-click, pay-per-click, Google Adwords, Google Adsense, Google first quarter results

Microsoft sent out the warning message this Monday to Yahoo’s board of directors, reasserting its proposal to acquire Yahoo!, and citing a deadline of three weeks for Yahoo’s consideration of the proposal.

Many people regard this as a bold move on Microsoft’s part to escalate its head-on competition with the number-one player in the Internet advertising field, Google. But . . . is it a good move?

Google’s success in the lucrative online advertising market rests on one single word: innovation. Yahoo is losing its market share to this tough player due to its own failure to compete in terms of innovation. And so is Microsoft.

Innovation: A Key Consideration

Innovation has nothing to do with the size of the player, nor its predominant market share. Note that Microsoft’s primary motivation in acquiring Yahoo is the direct inception of its well-established market presence, including a number of successful services serving the Internet community, such as Yahoo! Mail and Yahoo! Answers, as well as portal services such as Yahoo! Finance and Yahoo! News. But this motivation does not hit the main point of this argument: There is no leverage of innovation in this acquisition.

Microsoft’s success in its predominant strategy for dealing with competitors has seldom hinged on innovation. Its usual strategy for outpacing its competitors is either by beating the competitors through its dominant market share in other related services/products, or simply acquiring them in order to kill the competition. And perhaps this is the reason Microsoft has faced so many anti-competitive legal proceedings both in the United States and Europe.

For this reason, the combination of these two players, Microsoft and Yahoo!, could never increase Microsoft’s competing power against Google.

Google’s Use of Innovation

If you take a look at Google’s history, Google’s success can be attributed to the clever deployment of innovative services. Consider the following examples:

1) Google’s first success was the ranking algorithm of its indexed web pages based on inbound links from other websites. This algorithm is based on the PhD thesis written by Google’s two founders: Larry Page and Sergey Brin. The search results of this algorithm are excellent. Many users switched to using Google as their primary search engine instead of Yahoo because of its superior relevant search results. Google now commands more than 57% of the US search engine market share.

2) Google moved to use contextual text advertisements as opposed to traditional graphical based advertisements, successfully raising the click-through rate of the advertisements it holds for its clients. This is a vital move in Google’s history as contextual based advertising creates strong revenue streams for Google. And it literally proved that text-based online advertisement is indeed more effective than graphical ones such as banner advertisements.

3) Google further increases contextual advertisement exposure by introducing a well-accepted program for most website owners: Google’s Adsense program. This program allows a website owner to post Google’s contextual advertisements on his or her website. Google then charges its client for successful clicks on those contextual advertisements, and shares the commission with the owner of the website on which the ads were posted. Google makes this “pay-per-click” form of advertisement the defacto standard online advertising program. While Google is not the first company who promoted this form of advertising (Overture, now part of Yahoo, used this technique before Google), Google is the most successful at administering it.

4) Google stunned the industry back in 2004 when it offered its Gmail service with a user’s mailbox size of 1GB, capturing a large share of online email users. In this strategic service, Google is able to further expand its exposure of online advertisement to email users. The offering was so successful that it forced Yahoo! Mail and Microsoft’s Hotmail to offer comparable services in order to keep their customers.

5) Google offers other excellent services such as: Google Earths, Picasa, Google Docs, Google Analytics, Google Desktops, Google Videos (which is about to merge with Youtube). These services work to encourage various types of Internet users to use Google’s services. Some, such as Google Docs, are even targeting corporate customers, which promises to convert to excellent revenue sources in the future.

6) Google moved into the battlefield of mobile platforms earlier than any of its rivals except Microsoft. But Google’s eye is not on the license fee of the operating system, but on mobile advertisements. Google started the Open Source operating system Android for mobile phone manufacturers, offered for free in exchange for mobile advertisement exposures. Google takes a serious look at the growing trend of users’ online activities on mobile platforms and makes its move into this market aggressively.

To further illustrate Google’s commitment to innovation, take a look at http://labs.google.com. Here you can see they have a pile line of many products and services for online users. Each is targeting the specific needs of online customers in an innovative way.

Can the Microsoft / Yahoo! Combination Compare?

When you look back at Yahoo and Microsoft, there is no way they can compare with Google’s excellent work and work-to-be in innovative services. Google wins over Microsoft and Yahoo! through its people and clever strategies, not simply by a dominating presence in the market (though Google is already the market leader in many online services).

From that perspective, there is absolutely no leverage in Microsoft’s acquisition of Yahoo!. Google’s heavy objection to the acquisition is perhaps an over-reaction. Maybe the merger of these two Internet giants is good for Google. The uncertainties involved in a huge merger—such as the difficulties of merging two companies of totally different corporate cultures, the possibility of “brain drain” for those involved in the merger, and the significant cost of the integration process—could help Google defeat these two rivals altogether. Isn’t this a good piece of news for Google?

Tags: Overture, Google Labs, Microsoft acquires Yahoo!

Technorati Tags: Microsoft, Yahoo!, Google, Yahoo! Mail, Yahoo! Answers, Yahoo! Finance, Yahoo! News, Larry Page, Sergey Brin, contextual text advertisements, banner advertisements, pay-per-click, Overture, Gmail, Google Earths, Picasa, Google Docs, Google Analytics, Google Desktops, Google Videos, Overture, Google Labs, Microsoft acquires Yahoo!