Since 1999 when it moved its headquarters out of a rented garage and became a leading search engine, Google has continually brought us new and exciting ways to search. Its newest experiment has caused considerable buzz in the search industry. Google has now done away with keyword auctions and ad copy to bring local business owners a basic, flat-fee listing option on search engine results pages. These ads will also appear on Google Maps.

Why Is This Controversial?

Google established itself as a search giant, making millions through AdWords and the keyword-auction model (launched in 2000). Through the keyword auction, Google has made its ads trackable down to the most granular metric. To relinquish this model in an attempt to reach out to local business owners is no small leap of faith. While this experiment (currently isolated to San Francisco and San Diego markets) has been well received thus far for its simplicity and accessibility, its staying power has yet to be determined.

Flat-fee and pay-per-impression model ads have in recent years fallen by the wayside, unable to compete with the pay-per-performance model and its immediate trackability.  While businesses are always looking for a simple way to generate quality leads, they are also looking for proof that they are getting the most for their money.

Google Thought of Both

While Google has done away with the more granular aspects of the campaign setup (e.g. keyword auction, ad groups and ad copy), it has maintained some of the trackability.  Call tracking is included (as well as a “whisper” announcing each forwarded call: “This call is brought to you by Google”). Full reporting on clicks to the ads and your information page, as well as requests for driving directions and calls, are also provided. The introduction of this product makes search marketing more accessible to small local business owners, and gives them just enough data to determine if the program is worth their investment.

What are the Drawbacks?

One of the most popular features of AdWords pay-per-click campaigns is their inherent transparency. Campaign owners have complete control over which keywords they wish to attach to their ads, how much they want to pay for each ad, and, depending on the sophistication of their tracking methods by keyword, whether or not an ad is wasted budget. It allows freedom for business owners (or third-party agencies) to perform consistent analyses to optimize their campaigns to the fullest and stay current with search trending.

This new flat-fee model is undoubtedly simpler, although Google has not made all of the complications of setting up a campaign simply disappear. Google has adopted many of these setup responsibilities on their end. When business owners choose product categories, they are entrusting Google to use the categories as a guide for where they should be placed. Once Google has chosen, this cannot be changed for the life of a campaign.

This new ad is undoubtedly attractive — the blue-pin listing is quite prominent; therefore, it is good real estate. However, if Google introduces any more colored pins, it will have to introduce a color code, and many average users will likely divert to organic listings simply because they cannot decipher among paid listings.

Who Benefits?

Many local businesses are seeing a decrease in leads coming from their traditional media efforts. Increasingly more leads are being generated through online sources, but many smaller businesses don’t have the time or resources to finance, run and maintain a paid search campaign. Also, their websites aren’t generating enough traffic to make up the difference. Google’s new local paid ad option gives smaller businesses the online visibility that they have been missing, as users have gradually been using the Internet more in their daily routines.

The product is only available in certain markets. Visit 15miles.com or call your TMPDM/15miles representative if you would like to test this as a part of your interactive media plan.