April 22, 2010 (CAP Newswire) – When news of Twitter’s new advertising model hit the media last week, perhaps the most commented-on part of the story was the Google AdWords-style format the new model would utilize.
And what this means is a renewed rivalry between the search engine giant and the upstart social media marketing platforms currently stealing its thunder – which includes Facebook, which has been taking on Google just as aggressively as Twitter in recent months. How will Google react to this new competition, and how will it change the Internet and affiliate marketing as we know it?
In addition to last month’s much-discussed report that the popular social media site had for the first time ever (albeit briefly) surpassed Google as the most popular website in the U.S., Facebook has its own ambitious plan to expand its brand throughout the web. And Google is, of course, paying close attention, working on a counter-plan of its own.
“ … Facebook is intensifying its efforts to expand its empire beyond its Web site; the company wants to turn scores of sites across the Internet into satellites where users will be able to interact with their Facebook friends,” writes Miguel Helft at the New York Times.
“Facebook’s strategy, in some ways, follows an approach taken by Google nearly a decade ago. The Internet search engine, after establishing itself as a destination for Internet queries, began syndicating its search box, and later its advertising system, across the Web through toolbars and partnerships. As Facebook becomes an ever more important source of traffic to other Web sites, the two companies’ rivalry is certain to sharpen.”
Meanwhile, Facebook’s ad program is doing better than expected, according to one study, which looked at “the brand recall of 800k Facebook users and ads from 14 different brands across a range of categories,” according to MarketingPilgrim.com. “The conclusion appears to be that Facebook ads can help increase brand awareness and recall, when combined with naturally occurring endorsements.”
“In the meantime, Twitter is also looking to expand its presence across the Web with its @anywhere service, which will allow people to log in to Twitter from other Web sites,” the New York Times article continues. “The moves by Facebook and its rivals set up a battle for control over social interactions across the Internet.”
So far, Google’s answer to these battle cries has been the creation of Google Buzz, a partnership with fading social media star MySpace, not to mention a pre-emptive rollout of its own real-time search platform. But that’s been getting decidedly mixed results. In fact, the whole idea of “search advertising” is questionable, according to some online marketing experts.
“Search advertising clearly made Google the powerhouse it is today, with $23.7 billion in annual revenues last year,” writes Kim-Mai Cutler at Media Beat. “But a big question is how well it will work for real-time search, which is Twitter’s bread and butter.
“Real-time search is fundamentally different. Users look for what’s happening now — like news about the Polish president passing away or Justin Bieber. They’re not searching for general information or advice on what type of car to buy. So the percentage of queries that have commercial intent is probably lower.”
And Twitter’s plan may of course backfire; it’s too early to tell. “Several app makers have had a free ride thus far on Twitter’s infrastructure,” writes Doub Lacombe at the StarPhoenix. “Tweetdeck, Seesmic, Foursquare and others all benefit from the availability of Twitter and its open application programming interface (API). It will be interesting to see how much Twitter squeezes them out by building or acquiring its own apps and ad system.”
By this same logic, these Twitter dependents could easily jump ship to another social media site if Twitter loses its appeal. That’s the risk Twitter is taking with its new ad model. According to this report at BizReport.com, however, most online marketers aren’t giving up on Twitter just yet — quite the opposite, in fact.
In the meantime, Google still rules the roost, and it’s unlikely that Twitter will compete directly any time soon, based on one simple fact: “Very little of Twitter usage is search,” emphasizes Mahesh Murthy at the Wall Street Journal.
And where it counts, Google is still firing on all cylinders: “Google never really stopped growing during the recessionary downturn that claimed most of its online advertising rivals,” writes Rick Aristotle Munarriz at the Motley Fool investment site. “With sentiment improving, why would it buckle now? That’s right — the world’s leading search engine delivered another monster quarter.
“Revenue before traffic acquisition costs soared 24% to $5.06 billion. The bottom line grew even faster, with non-GAAP earnings surging 31% to $6.76 a share. Analysts figured that Google would earn just $6.60 a share without cracking the $5 billion revenue mark, but then, they’ve been serial lowballers. Google has topped Wall Street estimates in each of the past seven quarters. … Good news turns into great news when one considers that Google’s number of paid clicks rose by 15% during the period.” (The Motley Fool article does point out some potential pitfalls in Google’s future, however. It’s an interesting read; check it out here.)
The result of all this competition is a confusing netscape for online marketing and affiliate webmasters. Can one really be expected to stay on top of all these social media platforms, in the hopes of connecting with the one that’ll eventually come out on top? Is it really of value to spend hours networking on these social media sites? Opinions vary (although they usually lean toward “yes”), but what we’re seeing here is natural market forces, and if nothing else, it’ll be interesting to see where all this winds up in a few years. (One thing seems to be certain, though: Yahoo is conti
nuing to bungle its chances of keeping up with the big guys.)