We are all aware of the fact that, and the statistics confirm it, the percentage of consumers that decide to purchase a product or service online is in continuous growth. It’s not surprising online search advertising became an industry of enormous dimensions. The companies who want to sell their goods and services on the internet always have the need to reach their potential customer directly, 24/7, anywhere. How to do it?
Google Adwords Story: how to monetize a search engine.
Google was born in 1998 in a garage and was initially the only search engine who didn’t use advertising and additional services.
In Spring 1999, the company convinced two of the most prestigious Californian financing enterprises to grant them a loan of 25 million dollars dividing risks and profits. Google had now to guarantee them a model of profitable business that produced substantial earnings. To that time, as we have said, the companies of the internet (Yahoo, ecc.) had to use sponsorships and advertising banners to make money. Google could have done the same thing thanks to its massive indexed data, but the two founders were reluctant to mix advertising to search service.
The model of business right for Google’s “purist” ideal seemed to be making direct advertising in the search engine SERP instead of using the annoying visibility of banners, pop-up, etc. The idea was to show few selected links on the top of the SERPs. The advertisers had to pay to Google the number of impressions furnished by the company (CPM – Cost for Thousand Impressions).
This business model was discreet but wasn’t cost-effective for the company. Brin and Page started to look around to search for more pragmatic solutions. So the stumbled in Go.To, the society founded by Bill Gross. The intuitive model used by Go.To consisted in mixing organic and sponsored links. In this way the sponsored links appeared according to customers’ searches, maximizing the possibilities to complete the economic transaction (CPC – Cost for Click). Goto.com soon became Overture. Thanks to Overture advertising online became very easy. The advertisers chose the keywords, the ad related to the keyword and the offer and…they were online.
The impossibility to start a partnership with Overture forced Google to implement a similar tool internally. On October 2000, AdWords took form as a “self-service advertising system” in which the advertisers could choose the keywords for their sponsored links and directly purchase advertising ads by credit card (keywords advertising). AdWords was entirely successful, and earnings didn’t wait to come.
Google’s Keywords Advertising: the story begins
- October 2000. First AdWords’ ad was the one that was used for testing the tool: “HAVE A CREDIT CARD AND 5 MINUTES? GET YOUR AD ON GOOGLE TODAY.” A few minutes later Lively Lobster started to use Google AdWords to promote online its business.
- February 2002. AdWords introduces the cost-for-click strategy and the auctions for the maximum cost of each click. Who offers more is sure to earn the tallest place for the ads in the SERPs. In this release is also introduced the importance of “quality score” in determining the position of the ad.
- April 2003. Google presents Google Grants, a special version of Google AdWords for no profit organizations.
- 2005. Google starts Google AdWords Support Area and launches Google Advertising Professional to recognize skills of the professionals that operate to evolved level in the management of the AdWords’ accounts.
- July 2011. Google launches AdWords Express, the new tool for all the small enterprises who want to promote their business in their geographic area thanks to the integration between Google and Google Maps. The advertisers were able to choose target, budgets, and ads.
- February 2013. AdWords opens its doors to responsive and mobile advertising by introducing different ads for desktops, tablets and smartphones.
- 2016. Google changes SERP’s width and removed the right side column dedicated to sponsored links. The advertisers now can use only 7 positions for their ads (4 on top and 3 down the page). On October, Google introduces extended ads. This new ad format shows more information on products and services before clicking on sponsored links.
Google AdWords will change again?
Extended ads help advertisers to reach customers who use smartphones and tablet but, at the same time, reduce the space dedicated to sponsored links into SERPs. Advertisers are worried about the fact that less space for ads will mean higher costs for insertions but Google has already reassured its users about the fact that this won’t happen.
Now advertisers know how important is to pay attention to the new Adwords rules and opportunities in order to keep quality score, ads and landing pages at the highest level possible.
What do you think about it? Let us know what’s your opinion.