When you used to do a search for "auto parts" for example, you would get the top 5 organic results, as well as the top 5 sponsored results. When Google news came out, you got the top 4 organic results, the top 5 sponsored, and 3 or 4 headlines occupying the top of the page.

When Froogle was launched, you could get 2 or 3 Froogle results, followed by 2-4 news results, top 3 and a half organic results, but still 5 paid listings.

Do you see the pattern here? Guess what's next?

Now, if you have desktop search, on some search queries - you get:

-2 or 3 desktop results, and/or
-2 to 4 Froogle results, and/or
-2 to 4 News results, and
-as few as 2 organic listings.

We still see 5 or more paid listings, but as you can see, the visibility on organic results has dropped substantially: From occupying 50% of the results, to now occupying 20% or less of the search real estate. This obviously doesn't help the organic marketer.

People were wondering how Google could monetize desktop search? I don't think they have to "figure it out." By reducing the number of immediately visible organic results, they are naturally encouraging search users to pick the sponsored listings over the organic.

While it may be true that more people use organic results, it is also true that there is a percentage of the population which doesn't like to scroll down the page to see more. Therefore, if there are now less organic results to see, it's likely that these users will pick a paid listing, which obviously means money in Google's pocket.

Of course, not every search returns desktop AND Froogle AND news, but the so called high traffic markets most definitely do utilize some type of combination. And it can get worse.

When I do a search for "plasma TV" not only do I see local, and news results (surprisingly no Froogle), I also see 2 sponsored ads occupying the top spots. Now I see 2 organic listings and 7 paid listings! If I have many toolbars installed (I'm using Firefox browser so I only have Google and Yahoo! toolbars) the number of visible organic listings continues to drop.

A search for "laptop computer" returns almost identical results, except on my computer I see 2 organic listings and the title of the 3rd.

Keeping in mind that these are general searches I am performing and when I perform more specific searches (jeep YJ front bearings) I am back to 5 organic and 5 sponsored.

This type of searching opens up a whole new can of worms. We have shown that in the "research" stage of the buying funnel, people tend to start broad and refine their searches. If they cannot see many organic results they may default to reviewing the paid listings. And if they truly are simply researching, then the conversion rates on highly competitive (and probably highly expensive) key phrases will go down, while advertisers budgets may go up to compensate for the increased number of clickthroughs.

Conversely, as the searcher moves through the buying funnel, they are presented with more and more organic results as their search become more refined. So chances of them clicking on a paid listing become slimmer.

While I am speculating on a lot of this, it does seem to shoot Google in the foot. If most of their revenue comes from sponsored search, they risk losing advertisers who just can't afford to pay for clicks that don't generate income. In the long term, advertisers could quit buying Google AdWords simply because they don't generate the required return on investment.

Of course, that is probably years away as I am considered an "early adopter" which means that I love new technology, and will put up with bugs and quirks, while the average person waits a lot longer to adopt technology.

Rob Sullivan
Production Manager
Enquiro.com

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