December 2006

Rand Fishkin of SEOmoz recently asked a panel of search engine employees how they feel about pay-per-post reviews on blogs, and frankly their answers left me a little confounded. Tim Converse from Yahoo! answered first by saying they would not try to filter out the paid post from the other posts, and if the other outbound links were of a high quality, there would be no discount of link value. Adam Lasnik of Google and the other engines quickly followed suit by agreeing.

Now exactly what the hell is going on here? We’ve heard countless times that Google hates paid links. What precisely is the difference here? Sure, the paid reviews services require disclosure and they can’t force the writer to give a positive review, but a paid link is a paid link. I’m obviously not going to sell links that are completely off topic or to companies I just don’t have a good opinion of anyway. If ReviewMe wants to buy some links in the sponsor section of my site, they’re evil and trying to manipulate PR. However, if they pay me to write a review, those links are okay? I must be missing something, but it seems to me this just opens it up to abuse (and will probably give those services a lot more business). I’m going out now to buy 50 reviews. Who cares what they say, just give me the “white hat” links.

I applaud the reps for giving a straight answer to such a controversial question, but let’s get straight with our answers here. I don’t believe for a second that Google will not attempt to devalue paid reviews. I also don’t think Adam meant to go along with what Yahoo said, as the philosophies have always been different. Maybe he can straighten us out. Lots of hand clapping to Rand for asking the tough questions.

UPDATE: Comment from Matt Cutts on Search Engine Land:

The specific guideline for doing paid reviews or paid links is to make sure that your links don’t affect search engines. You can do that via a nofollow attribute on your links, or an internal redirect which goes through a page which is robot.txt’ed out, or several other methods.

Okay…? So yes, not, maybe again. Typical Google response.

So recently the guys putting on Elite Retreat threw out a chance to win a free ticket. I wanted to go, but couldn’t swing the 5k this close to Christmas. I can certainly handle the plane ride and the hotel though. Anyone that has a chance to spend a couple days with the four of those guys should take it. The information you would get in 2 hours would be worth the 5k. Anyawy, here is my response the the question they wanted answered.

If I had to give a one word answer to this question, I would say “Growth”. SEO is no longer a fringe marketing tactic it once was, and if you’re not doing it your competitors will be. Are you a company thinking about ignoring SEO and relying only on brick and mortar sales channels and traditional marketing techniques? This will clearly lead to stagnant growth and as the industry continues to mature could lead to disastrous results.

Any legitimate business will benefit including SEO with traditional marketing channels. There are the obvious ecommerce benefits with increased sales and increased lead generation. However, several other perks are attached to search that are often overlooked by the ignoramus company executive. Public relations and reputation management can be controlled much faster with search. Negative press can be knocked down in a matter of hours instead of days or weeks. Information on new products/services can be launched quickly, eliminating some of the advantages of the large corporations. Customer service can be streamlined and customers will experience less frustration.

There are some that claim SEO is a useless endeavor (Calacanis, Pasternack). Clearly this is a result of alien abduction and brainwashing. The numbers don’t lie. SEO consistently brings more return than any other form of marketing. Get in the game or get left behind.

Sweeping changes inside Yahoo Inc.’s senior executive ranks failed yesterday to convince investors that the Internet pioneer is back on track, and left unanswered growing speculation that the company could be bought by a major rival.

But Yahoo said the move sets it up for long-term growth and that the takeover rumours are no different from the market chatter that surfaced five years ago when the firm stumbled out of the tech bubble.

Management has recently received public lashings from both investors and within its own ranks, as Google Inc. devours the lion’s share of new Internet advertising dollars. In one example, Brad Garlinghouse, a senior vice-president, circulated an internal memo last month charging that Yahoo had spread resources so thinly that today “we focus on nothing in particular.”

The company is vowing to use resources more effectively, speed up decision making and streamline product development. It said late Tuesday that it will reorganize operations into three units: one responsible for expanding its Internet traffic, another for managing relations with advertisers and publishers, and a third to oversee development of products and technology. Several executives will leave the company as a result of the changes, including chief operating officer Dan Rosensweig.

“The Internet is continuing to grow and evolve at a rapid pace, and we’re reshaping Yahoo to be a leader in this transformation, just as we did successfully five years ago,” Terry Semel, Yahoo’s chairman and chief executive officer, said in a news release.

Investors reacted by driving Yahoo’s share price down 2 per cent yesterday. The shares fell 57 cents (U.S.) to $26.86 on the Nasdaq Stock Market.

The reorganization appears “reactionary and somewhat rushed,” said Rob Sanderson, an analyst with American Technology Research. Important roles were left unfilled in the shakeup, he added, including who will replace Susan Decker as chief financial officer after she assumes responsibility for advertising sales.

“We believe the remaining management team, with their media/finance backgrounds, still represents the wrong approach in an Internet battle that is steeped in technology,” Jeetil Patel, an analyst with Deutsche Bank Securities Inc., wrote in a research report.

Yahoo has been trying to boost profitability by trimming its research and development costs. The move is a critical mistake at a time when rivals are spending aggressively on product innovation, he said.

With almost 420 million registered uses worldwide, Yahoo has the largest collection of traffic on the Web. But it has failed to use its base as effectively as rivals have utilized theirs.

Mr. Sanderson estimates that Google is able to produce on average 66 per cent more revenue for every search using its technology than Yahoo. Yahoo hopes to close that gap with an upgraded search tool called Panama, but the new technology has faced delays and isn’t expected now until next year. Early reviews by advertisers have been positive, said Kerry Munro, general manager of Yahoo Canada Co., the fastest growing unit of the parent company.

The discrepancy has led to talk that Yahoo could find itself a takeover target of Google or even Microsoft Corp. The Redmond, Wash.-based software giant has upgraded its own search tools and is going after a bigger chunk of the online advertising business.

Yahoo’s management shakeup won’t do much to quell the takeover rumours, Mr. Sanderson said. “They are always on the table for any company that has lost a bit of its lustre, and especially so when the goliath in Redmond has been very public about its desire to be bigger in this arena.”

“The reorganization wasn’t meant to provide a bump in the stock price,” Mr. Munro said. “We are setting up the company for long-term growth.”

Internal reaction to the shakeup has been positive, he added. “People here are motivated.”