WebGuild – Searchnomics Conference June 27, 2007

June 26, 2007

WebGuild’s Searchnomics is tomorrow.

I’ll be moderating 2 panels:
1. Travel Search. Panelists: Drew Patterson (Kayak), Sam Shank (SideStep), Mike Fridgen (Farecast)
2. Shopping Search and Search Engine Marketing. Panelists: Bob Machaelian (Shopzilla), Jon Glick (Become)

Clean Up – NexTag

June 26, 2007

I don’t like to leave loose ends.

I reported back on May 29 that NexTag was being sold for $1B. Yes, I knew it was a done deal back then, but wanted the company to confirm…I don’t post rumors.

According the the WSJ (June 8), NexTag sold aprx. 66% of the company for aprx. $833M, giving NexTag a total valuation of aprx. $1.2B.

There are plenty of ex-Taggers out there kicking themselves for not staying an extra couple months and vesting their options (there are lots of ex-Taggers who left after about 7 months on the job). Interesting question now is whether the current employees were taken care of or if the founders and VCs were the only ones who profited from the deal. If it’s the later, expect a whole new wave of ex-Taggers.

Google Cancels Checkout Party

June 13, 2007

Bloomberg broke reported the news @ 3:05pm that Google Checkout canceled its party protesting the ban of Checkout on eBay. And so ends the first skirmish (Google Checkout announces party -> eBay pulls listings from Google AdWords) in the bigger battle.

Here’s the statement from the Google Checkout blog:

eBay Live attendees have plenty of activities to keep them busy this week in Boston, and we did not want to detract from that activity. After speaking with officials at eBay, we at Google agreed that it was better for us not to feature this event during the eBay Live conference. Google is constantly reaching out to new users and sellers, and we are available to privately discuss any matters of concern with individuals as they relate to Google products. Interested parties may contact us at checkout-reply@google.com.

Hat tip to my anonymous source who alerted me yesterday to eBay pulling its AdWords ads.

For those of you who are just now coming up to speed on this skirmish:
Google party at eBay event will protest Checkout ban – CNET News
eBay No Longer on Google AdWords – ComparisonEngines
eBay and Google: The Gloves Are Off, It’s Getting Ugly ProStores Scoop – AuctionBytes
Animosity Escalates as eBay Pulls Google AdWords, Reallocates Dollars – ClickZ
eBay vs. Google: eBay says, normal course of business… um, ok…right – eBay Strategies
eBay Pulls Google Paid-Search Ads To Protest Google Checkout Moves – Search Engine Land
eBay Halting its Google AdWords Advertising? – Search Engine Journal

eBay Back Up And Running on AdWords

June 12, 2007

As soon as I post, eBay ads go back up on Google AdWords, but I’m pretty confident the ads had been down since about mid-night last night.

We’ll see what the eBay/Google hounds find out…

eBay No Longer on Google AdWords

June 12, 2007

Update: Of course, as soon as I post this, eBay ads are back up and running. I knew that would happen.

eBay and Google are two companies up to their knees in coopetition – the intersection of competition and cooperation (Rob Solomon taught me that one). eBay has PayPal. Google has Checkout. eBay is a big advertiser on Google AdWords. eBay lists its products in Google Product Search driving traffic back to eBay. Yahoo Publisher Network ads and graphical advertising now appear on eBay, while Shopping.com, an eBay company, derives a ton of revenue from Google AdSense ads. PayPal is promoted to Yahoo! Merchants while Google Base doesn’t allow merchants to list PayPal as a payment option. With Google the search engine of choice for the majority of searchers and eBay a behemoth in the online shopping space, it’s obvious that these guys have to sometimes play nice with each other.

But the Google party protesting the ban of Google Checkout on eBay as a payment option doesn’t seem to be going over well with the execs at eBay. I got a tip saying that eBay had pulled all its ads from Google AdWords as of late last night. While I have no official confirmation, I couldn’t find one eBay ad live on AdWords, and AdWords is usually littered with them. Ads for eBay companies like Shopping.com and PayPal are still live on AdWords, but there isn’t even an eBay ad up for keywords like ‘ebay’ or ‘auction’ on Google AdWords.

My first thought was that this is as bad for Google as it is for eBay, but I’m starting to think otherwise. I believe that Google’s AdWords revenue is diversified enough to handle a loss of an advertiser like eBay. I don’t have data to back that up, but I don’t recall seeing statements in Google’s filings highlighting eBay as a significant proportion of its AdWords revenue. At the same time, according to a year old ‘term paper’ by Julien Decot and Steve Lee’s of the Haas School of Business (published on John Battelle’s blog):

Since Google has become such a valuable source of traffic for eBay, one of the kargest web sites, it stands to reason eBay is one of Google’s largest customers. eBay spent $1,230 million on sales & marketing in 2005. Fifty-three percent of eBay’s 2004 sales & marketing budget was spent on advertising with 62% allocated to online advertising. This is consistent with a leading analyst’s conclusion.Therefore, we estimate eBay spent approximately $400 million in online advertising in 2005, a figure consistent with a recent Wall Street Journal article. Given Google represents half of total online advertising revenues, it is reasonable to assume Google represents half of eBay’s online marketing spend, or $200 million. This corresponds to 3% of Google’s 2005 revenues. A conclusion is that eBay is more dependent on Google because a substantially higher percentage of their revenue, estimated at 12%, is dependent on Google versus an estimated 3% of Google’s revenues dependent on eBay.

As for how this relates to the shopping comparison engine world, while I don’t expect this tiff to continue as eBay would…well…die…Shopping.com would be hit hard as it gets a ton of traffic from Google AdWords as well as a ton of revenue from Google AdSense through crappy AdWords landing pages like these:


Furthermore, the other shopping engines would benefit by not having to compete with the ultra-aggressive eBay or Shopping.com on Google AdWords which usually bid on every keyword possible.

My prediction? eBay is back up on AdWords by tomorrow. Hope I’m wrong, though. THAT would be a great story.

PayPal Shopping – PayPal Teams Up With TheFind

June 12, 2007

PayPal and TheFind launch PayPal Shopping – or at least that’s what I’m calling it. The domain for the site isn’t actually paypalshopping.com (some clever entrepreneur owns that one), but actually paypal.thefind.com. The site allows shoppers to see just products from stores that offer PayPal as a payment option.

According to Siva Kumar, CEO of TheFind, “there are 175 million products from 500,000 stores on TheFind, while paypal.thefind.com has 50 million products from 200,000 stores.” Paypal has long offered a directory of shops which accept PayPal, but this new site offers a rich shopping experience as opposed to a list of shops ranked by volume.

There is no revenue split among TheFind and PayPal on the site – TheFind takes whatever it makes through it’s sponsored and graphical ads and PayPal monetizes through its normal transaction fees.

Siva explained that the UI for paypal.thifind.com is slightly different – you can see the PayPal logo/icon in a variety of places – but besides the focus on PayPal only merchants, everything else (the algorithm, for example) is the same.

paypal.thefind.com paypal thefind

When asked whether there would be promotion of the site by both parties, Siva declined to give details but hinted that there’s definitely a relationship beyond just launching the site.

While PayPal is obviously a leader in the payments space with “revenues last quarter of $439 million” (Business Week June 18), the company is trying to fend off competition from the likes of Google Checkout which is assimilating everything in it’s path. Google Checkout attracted small businesses, then offered incredible promotions to get consumers to sign up, which led more small businesses to integrate as the user base grew and free Adwords credits were doled out, and it has just snowballed from there. I’ve voiced my concerns – especially around customer ownership – but that’s not stopping 94% of merchants from making a quick buck or 10.

Google Checkout is now well integrated into Google Adwords and Google Base/Google Product Search:

Google Checkout with Google Adwords and Google Product Search

Yahoo! and PayPal are testing a similar concept for Yahoo! Search Marketing:

Yahoo PayPal integration

This new PayPal shopping site shows me that PayPal isn’t going to sit by and just watch Google Checkout have all the fun.

As for TheFind, this shows what a scrappy start up can get done and some of the advantages the company has over shopping comparison engines which don’t crawl the web and therefore have a limited set of merchants. Expect TheFind to strike further partnerships like this with any affinity type program – think credit cards, causes (similar to PriceGrabber’s ShopGreen), schools, etc.

Friendly reminder that I’ll be at eBay Live! speaking on buySAFE’s invitation only luncheon panel on multi-channel e-commerce this Friday. Make sure to RSVP if you want to attend.

Invitation only buySAFE Luncheon during eBay Live!

June 10, 2007

I’ll be participating in a buySAFE invitation only lunch panel next Friday during eBay Live!

The topic is Discovering the Secret Sauce of Multi-Channel Selling Success.

Ina Steiner will be moderating Bjorn Espenes, Jonathan Garriss, Steve Woda, and Brian Smith (me).

Thanks to buySAFE for the invitation. If you’re a multi-channel merchant attending eBay Live!, I’m sure this panel will be a treasure trove of valuable information (and it’ll get you away from all the craziness for a couple hours). It’s invitation only, so RSVP to ebl2007@buysafe.com ASAP.

More details on the luncheon can be found on buySAFE’s blog.


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