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FTC Rules on Paid SE Advertising.

         

Brett_Tabke

8:45 pm on Jun 28, 2002 (gmt 0)

WebmasterWorld Administrator 10+ Year Member Top Contributors Of The Month



In followup to last years discussion on search engines and paid advertising:

[webmasterworld.com...]

Internet search engines that take money from Web sites in exchange for prominent placement should make that practice clearer to Web users, federal regulators said Friday.

Ap Story [story.news.yahoo.com]

msr986

8:50 pm on Jun 28, 2002 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



>Regulators said there is no determination the search engines broke the law, and it plans no other action.

No action? Seems like business as usual!

rubble88

8:55 pm on Jun 28, 2002 (gmt 0)

10+ Year Member



Full-Text of FTC Response:
[commercialalert.org ]

Brett_Tabke

8:57 pm on Jun 28, 2002 (gmt 0)

WebmasterWorld Administrator 10+ Year Member Top Contributors Of The Month



...it will send a letter to each calling for "clearer disclosure of the use of paid inclusion, including more conspicuous descriptions of paid inclusion itself."

The FTC said it will send the letter to AltaVista, AOL Time Warner, Direct Hit Technologies, iWon, LookSmart, Microsoft and Terra Lycos.

None to the "paid inclusion" search engines? Me thinks some people didn't understand the nature of the pfi model.

cyril kearney

9:05 pm on Jun 28, 2002 (gmt 0)

10+ Year Member



I think this ruling was expected from the FTC. Paid placement in SE follows a long standing practice in telephone yellow pages. Some people buy ads and the ads dominate the yellow page listings.

I think this just follows the capitalistic model which US businesses follow.

The downside is that SEO optimization is becoming less important (if it is still important at all). From the point of view of the mom and pop websites SEs have become a waste of time and effort.

Just as cost of national TV advertising is outside the reach of most small businesses, we are beginning to see that it is happening on the Internet.

dannysullivan

9:40 pm on Jun 28, 2002 (gmt 0)

10+ Year Member



> None to the "paid inclusion" search engines? Me thinks some people didn't understand the nature of the pfi model.

They actually didn't bypass paid inclusion at all -- thought that might happen, but the report didn't ignore it and did say that it probably needs to be called out in some cases.

Since all of the companies originally named have some time of PFI in their results. Presumably, they should be thinking about ways to label this, to stay in the FTC's good graces. The letter they all got said:

"the use of paid inclusion is clearly and conspiciously explained and disclosed"

I always thought a good way might be a small icon that appears alongside the listing. Do a search, see nothing but results with icons, and it would be pretty easy to spot the true influence PFI is having on the results.

Inktomi and FAST didn't get letters, but they weren't named in the original suit (and Inktomi doesn't have a site to label, in any case). But anyone running paid placements or paid inclusion on a search engine in the United States is going to have to pay attention to this. It's only a recommendation, but I'm sure if the FTC doesn't feel they see changes, it could become something they decide should be enforced.

john316

9:49 pm on Jun 28, 2002 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



Its all about disclosure. Good for the consumer, the advertiser and the web.

". any paid ranking search results are distinguished from non-paid results with clear and
conspicuous disclosures;
. the use of paid inclusion is clearly and conspicuously explained and disclosed"

They recommend these guidlines for disclosure:

"Accordingly, disclosures must be communicated effectively so that consumers are likely to notice and understand them."

At: [ftc.gov...]

Brett_Tabke

10:01 pm on Jun 28, 2002 (gmt 0)

WebmasterWorld Administrator 10+ Year Member Top Contributors Of The Month



> Some people buy ads and the ads
> dominate the yellow page listings.

It wasn't about the yellow pages, it was about ads appearing in the white pages.

Paid inclusion se's should have been the center piece of this whole discussion from the start.

How many ads are this "search results [hotbot.lycos.com]"? Appears to be 10 to me. Placement wasn't garanteed, but inclussion was. Only the set off top 3 are remarked as advertisements.

I'd not realized Ruskin didn't include the pfi engines in the original complaint.

[edited by: Brett_Tabke at 10:35 pm (utc) on June 28, 2002]

dannysullivan

10:17 pm on Jun 28, 2002 (gmt 0)

10+ Year Member



The PDF file takes a long time to download, since it's a scanned version of the letter. There's not yet an HTML version posted at the FTC site. There will be -- this is all a matter of public record, so I thought it might be interesting to share from the PDF file key parts of the letter that the search engines are going to receive. This isn't copyrighted material, so it should be OK with the terms of the forums to post. If not, kill away, Brett :)

The PDF file is both a letter to Consumer Alert, which filed the complaint, and then there is a separate letter that all the search engines named in the complaint will receive. It tells them:

"While many search engine companies do attempt some disclosure of paid placement, their current disclosures may not be sufficiently clear. The staff also believes that, depending on the nature of the paid inclusion program, there should be clearer disclosure of the use of paid inclusion, including more conspicuous descriptions of paid inclusion itself. As a general matter, clear and conspicuous disclosures would put consumers in a position to better determine the importance of these practices in their choice of search engines to use...

....The staff recommends that if your search engine uses paid placement, you make any changes to the presentation of your paid-ranking search results that would be necessary to clearly delineate them as such, whether they are segregated from, or inserted into, non-paid listings. Factors to be considered in making such a disclosure clear and conspicuous are prominence, placement, presentation (i.e., it uses terms and a format that are easy for consumers to understand, and that do not contradict other statements made), and proximity to a claim that it explains or qualifies.

Moreover, the staff recommends that if your search engine uses paid inclusion program that may distort rankings or placement criteria, you clearly describe how sites are selected for inclusion in your indices. Also, consumers should be able to easily locate your explanation of the paid inclusion program you use, and discern the impact of paid inclusion in search results lists."

dauction

10:33 pm on Jun 28, 2002 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



cyril said "The downside is that SEO optimization is becoming less important (if it is still important at all). From the point of view of the mom and pop websites SEs have become a waste of time and effort. "

I am growing more and more to believe it..that said,
DannyS ..you're the expert in this area..for us mom and poppers (other than getting the best possible rank in google)..what is your recommendation for the smaller sites..

If paid ..where do you feel the best bang for the buck is?

Overture, Google Keywords, Inktomi , Teoma ? ??

Thanks..

herb

10:39 pm on Jun 28, 2002 (gmt 0)

10+ Year Member



“Moreover, the staff recommends that if your search engine uses paid inclusion program that may distort rankings or placement criteria, you clearly describe how sites are selected for inclusion in your indices.”

Are they asking them to disclose their algo? Sounds like it…

dannysullivan

10:46 pm on Jun 28, 2002 (gmt 0)

10+ Year Member



> for us mom and poppers (other than getting the best possible rank in google)..what is your recommendation for the smaller sites..

I know it sounds like a broken record -- and you'll hear it in plenty of threads in the forums here -- but content. I think the more you can make your site go beyond just selling and instead be a resource for people, the more likely you're going to continue getting placement in the free editorial listings that are available -- even in places that use PFI.

The good content in turn generates those all powerful links. Good links, and good links which are difficult for the big companies to buy. Big companies don't like to link out to others, and linking out to others is often what helps you get links in the first place. Quality link building is also not a service that is easily bought. It's hard for a big company to go out, find key sites in their topic areas, locate the right place in those sites where they'd like to be linked and then make a proper link request. They generally don't seem to have people who do this internally, and third-party SEO firms usually don't focus on (quality) link building. I know there are some, but there are so many other things they can do instead. So for a mom-and-pop, you run your own shop, you have the ability to get the right things done without playing telephone with someone else who may not know your business -- and the sites it is related to -- as well.

> If paid ..where do you feel the best bang for the buck is? Overture, Google Keywords, Inktomi , Teoma ???

That's so hard, because everyone has different experiences. Again, that's why the forums are so good, as you can get a wealth of experiences from different people.

I tend to think it makes sense to start with the big ones, Overture and Google, if you are going to pay. You can start off slow, you can guarantee your placement and do this to fill the gaps that you aren't getting from editorial listings. If it is working, you can tell you are getting a good return on your investment, then you can ramp up.

As for PFI, personally I see this as most advantageous to those people with really large web sites, especially product databases. People do very specific searches. If you can feed your database of 100,000 items to someone like Inktomi, you'll probably find plenty of hits and at a good cost per click rate.

For mom-and-pops, if doing a new site, I would hit all the major PFI people to get my home page in quickly, if I didn't want to wait a month or so for it to get found naturally. I'd then wait to see what gets picked up, then use PFI to insert those pages I think are really important but which continue to be ignored.

Alternatively, if you are really into optimization -- really reworking your pages to try to climb them up the ranks -- then PFI gives you much better control, since the fast refresh gives you fast feedback.

dauction

12:22 am on Jun 29, 2002 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



thanks Danny,

my latest is in my profile..

It is basically nothing more than a product site as you say ..and as with most of my sites I have long considered my "products" my content..I realize that is no longer true(enough)

I do understand that may have flown at one time (just listing products when it wasnt so saturated)..but no longer.. I do well with these sites but could do so much better with more texual content releated to each product? ..say the movie products..instead of just the "product" have actors BIOs, release dates, triva related to the actors/movies (interactive polls etc..)?

do the same with each "product" I am selling..

In doing so I should be able to pickup the ever elusive inbound links?

This would be the correct path then?

I also wanted to increase the sub-affilites and even have asked (no response yet) about offering FREE sub-domains with the stipulation that they sign up as a sub of mine ? Worth exporing IYO?

I believe I will do a google adword on this as soon as I have a better direction and Inktomi seems to have broad coverage of a lot of engines..

If you get a chance I'd sure like some verification or lead to a better path..

I apologize to the board for getting off topic with this just trying to grab Danny while I have the chance..:)use to visit one of your sites all the time.. I still only reg domains that reflect my product or services...(yes, things have changed..but)if nothing else for perceptual purposes..you're looking at two links ..one that reflects what you are searching for one that dosent..I think it's clear which one most would click on.

Thanks..

We can move this to a differnet thread if necessary..

john316

3:58 pm on Jun 29, 2002 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



"The Commission has brought actions against infomercial producers for failure to
disclose that a television show was not an independent program but was, instead, a paid commercial advertisement."

I believe the FTC is pretty serious about disclosures, and for anyone wondering what a "proper" disclosure looks like in the eyes of the FTC, just flip on the television and watch the disclaimers that precede an infomercial..now thats *disclosure*.

"We can move this to a differnet thread if necessary.."...sounds like a good idea

mundonet

6:07 am on Jul 2, 2002 (gmt 0)

10+ Year Member



It's about time that they identify paid listings as such. Would love to give less money to Overture & friends and get free clicks as not so long ago. I'm sure that Joe public would click less on it if he would know that it's advertising.

wasmith

6:20 am on Jul 2, 2002 (gmt 0)

10+ Year Member



what ever happened to the bill of rights

>> The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

Am i too old? Too care.

Brett_Tabke

3:18 pm on Jul 2, 2002 (gmt 0)

WebmasterWorld Administrator 10+ Year Member Top Contributors Of The Month



Reuters story followup that say some se's will rethink the way they display ads:

Reuters story via itweb.co.za [itweb.co.za]

mundonet

6:17 am on Jul 4, 2002 (gmt 0)

10+ Year Member



What does the bill of rights have to do with this??? The right to know that it's advertising? The right to lie about it?